Beneficial owners – Turkey
The following types of beneficial owner are recognised for tax purposes in Turkey:
Debt securities
Bonds issued by the Turkish governmental authorities or institutions through the Central Bank of the Republic of Turkey
Beneficial owner | Withholding Tax Rate | Capital Gain Tax Rate |
All eligible beneficial owner types (No withholding tax is deducted on interest or capital gains from such securities held in Clearstream ) | 0% | 0% |
Other types of bonds
Under review but will be updated shortly
Equities
Under review but will be updated shortly
Name change, change of legal status, incorrect tax rate applied etc.
Beneficial owners holding a Tax ID or national ID number in Turkey are obliged to inform the Turkish Tax Office, via Clearstream, of the following:
- Articles 157 to 159 of Turkey’s Tax Procedure Law (VUK) require corporate taxpayers to notify the Tax Office of changes to their:
- taxation status;
- Workplaces (mainly applicable for Turkish corporate entities with branches located in different workplaces that are registered/ recorded in the trade registry and tax offices);
- windups/liquidations.
- Pursuant to the Tax Procedure Law Communiqué No. 240 A/2 (published in the Official Gazette No. 22327 on 28 June 1995) changes to a taxpayer’s name, changes resulting from mergers and other changes of the taxpayer’s taxation status must be communicated to the Tax Office within a month. While the Tax Procedure Law Communiqué No. 240A/2 is primarily targeted at Turkish resident taxpayers, it is recommended that foreign investors comply with the Communiqué’s provisions.
- Personal bankruptcies, incapacitations, deceases or other changes to an individual (non-corporate) taxpayer’s status are not clearly governed by Turkish tax law. It is however recommended that such changes is notified by the taxpayer, its successor, guardian or legal representative to the Tax Office within a month pursuant the Tax Procedure Law Communiqué No. 240 A/2.
- Any taxpayer who realises that a wrong taxation status or tax rate was applied that resulted in a tax underwithholding on a past income or capital gain must declare this to the Tax Office. Clearstream’s depository will assist in declaring the underwithholding upon the beneficial owner’s request. The declaration is mandatory whenever the taxpayer (beneficial owner) identifies the underwithholding within five years of the date on which the income was paid/the capital gain occurred. No declaration needs to be made whenever the taxpayer identifies the underwithholding later than five years after the date on which the income was paid/the capital gain occurred.
Whenever a notification to the Tax Office is required pursuant to the above beneficial owners should notify Clearstream. Clearstream will then forward the beneficial owners notification to its depository, who in turn will notify the Tax Office accordingly.
The following documents will be needed:
- Instruction by Swift MT599 free-format message;
- An official apostilled Certificate of Name Change showing the former name and the new name of the investor and the effective date of change, when applicable. The hard copy of this document should be provided via courier.
- NRIF name change letter (only applicable to NRIF status accounts), when applicable.
Note: Clearstream’s depository will take care of the translation, if required.