On 23 April 2026, in a televised address from Ankara, Turkish President Recep Tayyip Erdoğan announced what is being characterised as the country's most aggressive foreign-investor incentive package in two decades: a 20-year tax holiday for qualifying foreign investors, structured to attract long-horizon capital into Turkish real estate, infrastructure, and selected strategic sectors.

For prospective international property buyers, the announcement adds a powerful second layer on top of the well-established Turkish citizenship-by-investment programme. Where the citizenship route delivers a second passport against a USD 400,000 property purchase, the new tax holiday delivers something different: two decades of structural tax exemption across the income that property and aligned investments generate over that period. Stacked together, they reshape the arithmetic on Turkey as an investment destination.

This briefing covers what's actually in the announcement (and what's not yet defined), how the framework appears to interact with existing programmes, a worked example of the savings on a typical investor portfolio, and the practical implications if you're weighing a Turkish purchase in the next 12–24 months.

What the announcement actually covers

Based on the official summary released alongside the President's address, the 20-year tax holiday will apply to qualifying foreign investors across four primary tax categories. The fine print will be published in the Resmi Gazete (Official Gazette) as the implementing regulations come into force through Q3 2026, but the headline contours are clear:

• Personal income tax on rental income from qualifying Turkish property — full exemption for 20 years from the date of purchase, applicable to foreign individuals holding qualifying assets.
• Capital gains tax on sale of qualifying assets — full exemption for assets held for the minimum holding period (expected to be 3+ years, mirroring the citizenship programme structure).
• Withholding tax on dividends and distributions from qualifying Turkish corporate structures controlled by foreign investors — reduced rate or full exemption to be defined in the implementing regulation.
• Property tax (Emlak Vergisi) — partial exemption or rate reduction for qualifying foreign-held property; final scope subject to the implementing regulation.

Critically, the announcement also previewed an expansion of qualifying investment categories beyond residential property — to include certain commercial real estate, Turkish-domiciled investment funds (Türk Yatırım Fonları), and infrastructure participation. The full taxonomy of "qualifying investments" will be issued by the Treasury and Ministry of Finance.

Who qualifies as a foreign investor

The framework appears to target three categories of foreign capital, each with distinct qualifying mechanics:

1. Foreign individuals

Non-Turkish citizens making personal investments above a defined threshold (expected to align with — or replace — the existing USD 400,000 citizenship-programme floor). Individuals who already hold Turkish citizenship through the investment route appear to be eligible for the tax holiday on additional qualifying capital, meaning the two programmes are intended to be complementary rather than mutually exclusive.

2. Foreign-controlled Turkish companies

Turkish-registered legal entities (Limited Şirket or Anonim Şirket) where majority foreign ownership is documented. This brings family-office structures, foreign-investor SPVs, and international developer JVs into scope — a meaningful expansion compared to programmes elsewhere that restrict benefits to individual buyers.

3. Foreign institutional investors

Sovereign wealth funds, foreign pension funds, and licensed institutional investors meeting registration requirements with Turkey's Capital Markets Board (SPK). This category is most likely to drive the largest absolute capital inflows over the 20-year horizon.

How it stacks with Turkish citizenship-by-investment

The most consequential interaction for property buyers is between the new tax holiday and Turkey's existing citizenship-by-investment programme. Today, that programme grants Turkish citizenship — and a second passport — to foreign nationals investing USD 400,000+ in Turkish property held for at least three years. Roughly 25,000 foreign investors have used it since launch.

The new framework appears to allow buyers to:

• Use the same qualifying property purchase to claim BOTH the citizenship pathway AND the 20-year tax holiday on rental/capital-gains income from that property
• Combine USD 400,000+ residential purchase with the broader basket of qualifying investments (commercial property, investment funds) to unlock the tax holiday across a larger portfolio
• For citizenship-route investors who later acquire additional Turkish assets, claim the tax holiday on the additional capital without restarting the citizenship clock

"The signal here is clear: Turkey wants long-horizon foreign capital, and it's prepared to give up tax revenue on that capital to attract it. For investors weighing the citizenship-by-investment programme against alternatives, the addition of a 20-year tax holiday materially changes the after-tax return profile."

Worked example: 20-year savings on a $1 M property portfolio

Consider a hypothetical foreign investor purchasing a USD 1,000,000 portfolio of Istanbul residential property — for instance, a USD 400,000 apartment in Beşiktaş (qualifying for citizenship) plus two USD 300,000 apartments in Kadıköy and Şişli. Assume:

• Gross rental yield of 5 % annually = USD 50,000/year in rental income
• Standard Turkish income tax rate on rental income for non-residents: tiered, roughly 15–35 % effective on this band
• Property tax (Emlak Vergisi): ~0.2 % of declared value annually ≈ USD 2,000
• 20-year property value appreciation: assume conservative 4 % real-terms compound, ending value ~USD 2.2 M

Under the current pre-holiday regime, the investor would pay roughly USD 10,000–17,000 in annual income tax on rental income, plus USD 2,000 in property tax — totalling USD 240,000–380,000 across the 20-year horizon, before considering capital gains on exit.

For a USD 1 M portfolio, the tax holiday could plausibly preserve USD 400,000–500,000 of after-tax return over the holding period — effectively a 40–50 % uplift on net economics compared to non-qualifying capital. The actual number will depend on the exact thresholds and exemption scope in the implementing regulations, but the order of magnitude is consistent with what the announcement is signalling.

How Turkey's offer compares internationally

Set against other globally-marketed investor-residency and tax programmes, the combination of citizenship-by-investment + 20-year tax holiday repositions Turkey aggressively. A simplified comparison:

The differentiator: most European programmes deliver residency without a structural multi-decade tax exemption tied to the property investment itself. Turkey's package combines second-passport optionality, lower entry threshold, and an extended tax holiday — a combination none of the established alternatives currently match.

Implementation timeline and what to watch

The presidential announcement is the policy intent. The legal mechanics will roll out in three expected phases:

• Q2 2026 (May–June) — Council of Ministers decree publishing the headline framework and qualifying thresholds.
• Q3 2026 (July–September) — Implementing regulations from the Ministry of Treasury and Finance defining the exact tax categories exempted, qualifying investment taxonomy, and application procedures.
• Q4 2026 onward — First wave of applications processed; transitional provisions for investors who purchased qualifying assets in late 2025–early 2026 expected to be defined.

Investors considering a purchase in 2026 should specifically watch for: (1) the transitional treatment of pre-announcement purchases (will the tax holiday apply retroactively to qualifying 2025/2026 purchases?), (2) the exact qualifying property categories, and (3) any requirements around holding period, residence status, or registration with Turkish tax authorities.

What this means if you're considering a Turkish purchase

The practical takeaway for prospective buyers: this is the moment to plan, not to delay. Three reasons:

• Transitional provisions historically favour early movers. When Turkey introduced the citizenship-by-investment programme in 2017, buyers who closed in the first 12 months captured the most favourable thresholds. The same dynamic is likely with the tax holiday.
• Property prices respond to demand signals. Past Turkish foreign-investor incentive announcements (the 2018 citizenship threshold drop from USD 1 M to USD 250 K, the 2022 increase to USD 400 K) drove notable price acceleration in qualifying segments within 12 months of announcement.
• The qualifying threshold is likely to rise over time. As application volumes grow, Turkey has historically tightened qualifying criteria — meaning the most accessible entry point is usually right at the launch of a programme.

If you're already considering the citizenship-by-investment route, the tax holiday adds substantial weight to the case. If you weren't, the holiday alone may be the deciding factor. Either way, the next 12–18 months represent a window of pricing and policy clarity that is unlikely to recur.

Next steps

If you'd like to evaluate how the new framework affects your specific situation:

• Request our updated buyer guide covering the qualifying property categories and projected after-tax returns under the new framework
• Schedule a consultation to discuss citizenship-by-investment + tax-holiday stacking on a portfolio matching your budget
• Get on our policy alert list to receive the implementing regulations as they're published

The Tru Property Turkey advisory team has been involved in over 150 citizenship-route transactions and is actively positioning client portfolios under the new framework as the implementing regulations come into force.