Withholding Tax in Türkiye on Dividends Paid to Non-Resident Shareholders

When a Turkish joint stock company (anonim şirket) or limited liability company (limited şirket) distributes dividends to a shareholder who is tax resident abroad, it withholds 15% tax in Türkiye on the gross dividend under domestic law. If an applicable double tax treaty (DTT) is in place between Türkiye and the shareholder’s country of residence and the shareholder meets the conditions for treaty benefits, the treaty cap applies where it is lower. The rate to apply depends on the shareholder’s tax residence, whether the shareholder is the beneficial owner of the dividend, whether it is an individual or a company and, under some treaties, the direct shareholding percentage and the period for which the shares have been held.

How Is the Rate Applied in Türkiye Determined?

The rate is determined in three steps. Domestic rate: Dividends distributed by a resident company to non-resident individuals are subject to withholding under Article 94/6-b-i of the Income Tax Law (GVK); dividends distributed to non-resident companies that do not derive them through a permanent establishment or permanent representative in Türkiye are subject to withholding under Article 30(3) of the Corporate Tax Law (KVK). The rate is set by Presidential Decision. Presidential Decision No. 4936 reduced the rate from 15% to 10% from 22 December 2021. Presidential Decision No. 9286, which entered into force on 22 December 2024, raised it back to 15%. As of 9 November 2026 no later decision changing this rate has been issued. Treaty cap: The dividend article of a DTT sets the upper limit on the tax that Türkiye may levy as the source country. Rate applied: If the shareholder meets the conditions for treaty benefits, the lower of the domestic rate and the treaty cap applies. If the treaty cap is 10%, 10% is withheld; if the treaty cap is 20%, the domestic rate of 15% is withheld.

Past distributions are subject to the rate in force on the distribution date. For distributions made between 22 December 2021 and 21 December 2024 the domestic rate was 10%, so treaties with a cap above 10% did not reduce the withholding in that period.

Withholding Tax by Country for Individual Shareholders

The table below shows, as of 9 November 2026, the general treaty cap and the rate applied in Türkiye on distributions to individual shareholders who meet the conditions for treaty benefits, for the countries in the dividend rate table of the Turkish Revenue Administration (GİB). The same rates apply to corporate shareholders that do not meet the conditions for a reduced corporate rate. Hong Kong is covered separately below because of its start date.

The country table is compiled from GİB’s dividend rate table; for countries with a revised treaty, the rate in the revised treaty is used. For Japan, according to the footnote to the GİB table, the caps in Türkiye are 15% and 20% under the conditions set out in the protocol; in either case the rate applied is 15%. For Qatar, the 10% rate in the revised treaty of 18 December 2016 is used. For Azerbaijan, the 12% rate in the 1994 treaty is used. As of 9 November 2026 the treaty list of the State Tax Service of Azerbaijan does not show an entry-into-force or effective date for the new treaty signed on 19 February 2024.

Shareholding Percentage May Reduce the Rate for Corporate Shareholders

Some treaties provide a lower rate where the foreign company that is the beneficial owner of the dividend holds a certain stake in the Turkish company making the distribution. Conditions vary by country. Some treaties look at the share of capital, others at voting rights; some require the shares to be held directly. The holding period or the way the profits underlying the distribution were taxed may also change the result.

The examples show how reductions for corporate shareholders differ. For the full country list and special provisions, the GİB table should be read together with the dividend article and protocol of the relevant treaty.

Hong Kong Treaty Applies to Withholding Tax from 2027

The Türkiye–Hong Kong DTT entered into force on 30 January 2026, as determined by Presidential Decision No. 11064. The entry-into-force date is not the date from which the treaty applies to Turkish withholding tax. Under Article 28(2)(b)(i) of the treaty, with regard to taxes withheld at source in Türkiye, the treaty applies to amounts paid or credited on or after the first day of January of the year following the year in which it enters into force. That date is 1 January 2027. Dividends paid in 2026 to a Hong Kong resident shareholder are therefore subject to the domestic 15% withholding in Türkiye.

From 1 January 2027 the general treaty cap is 10%. The cap is 5% if the beneficial owner is a company (other than a partnership) that directly holds at least 25% of the capital of the Turkish company throughout a 365-day period that includes the payment date (Art. 10(2)). Under the protocol, if dividends become taxable in Hong Kong, these rates increase from 5% to 10% and from 10% to 15%. The entitlement to benefits provisions in Article 27 of the treaty must also be taken into account.

Which Documents and Conditions Are Checked Before the Distribution?

If a reduced rate is to be applied, the shareholder’s tax residence is evidenced by a certificate of residence issued by the competent authority of the country of residence, together with a duly made Turkish translation. The distributing company also assesses, under the relevant treaty, whether the shareholder is the beneficial owner of the dividend and, where the reduced corporate rate is claimed, whether the direct shareholding and holding period conditions are met. The payment date matters. As the Hong Kong example shows, the date a treaty enters into force and the date it starts to apply to withholding tax may differ.

The tax withheld in Türkiye forms part of the shareholder’s total tax burden. The country of residence may require the dividend to be declared or may levy additional tax. Whether the tax withheld in Türkiye can be credited there, or whether the dividend is exempt, is determined by the elimination of double taxation article of the relevant treaty and the domestic law of the country of residence. Gains on a sale of the shares are a separate matter; see our guide to the taxation of share sales by foreign investors.

Last legislative review: 9 November 2026 · Period covered: dividend distributions made on or after 22 December 2024; for Hong Kong, payments in 2026 and from 1 January 2027