Turkey accelerates sharing of expatriate bank data with foreign tax authorities

Turkey has accelerated the transfer of bank account information belonging to Turkish citizens living abroad to the tax authorities of their respective countries of residence. This process is conducted under the ‘Multilateral Competent Authority Agreement on the Automatic Exchange of Financial Account Information’, which came into effect on May 31, 2021.

Under this agreement, data regarding individuals living abroad who hold more than $1,000 in income or bank assets in Turkey is automatically shared. This has placed approximately 6 million Turkish expatriates, particularly those in Germany, under scrutiny by foreign tax offices.

Authorities in countries like Germany are investigating the source of funds and questioning why previously held assets were not declared. While funds transferred via bank channels from Germany to Turkey typically face fewer issues, cash deposits or funds with undocumented origins are triggering investigations into tax evasion and money laundering. Individuals receiving social benefits in their country of residence while holding undisclosed assets in Turkey also face potential legal consequences, including the repayment of benefits and possible imprisonment for large sums.