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Turkey implements 10% withholding tax on money market funds

Updated 2 times since CLSTR started tracking revisions of this situation.

What changed

2026-08-25 07:45 UTC → 2026-09-05 09:14 UTC · added ~~removed~~

Turkey implements 10% withholding tax on money market ~~fund taxation policy~~ funds

The Turkish Ministry of Treasury and Finance has moved from evaluating new taxation models for money market funds to finalizing a specific proposal. Initially, the Ministry conducted studies to address the rapid growth and volatility of short-term capital inflows, often referred to as ‘hot money.’ The goal was to encourage investors to shift from highly liquid, short-term instruments toward more productive, long-term investments. The investigation noted a disparity between the 17.5% withholding tax applied to individual investors and the different treatments available to institutional investors. Following these studies, the Ministry announced plans to implement a 10% withholding tax on gains from money market funds for both domestic and foreign institutional investors. Under this proposed regulation, domestic full taxpayers can offset the 10% tax against provisional quarterly tax declarations, while for foreign institutional investors, it is intended to act as a final tax. The current 17.5% withholding rate for individual investors is expected to remain unchanged, and the new regulation will only apply to gains generated after its official publication in the Official Gazette. A Presidential Decision published in the Official Gazette has now formally introduced this new tax regime via an amendment to Article 67 of the Income Tax Law. The withholding tax (stopaj) rate for gains from money market funds and specific free funds containing ‘money market’ in their title has been increased from 0 percent to 10 percent. This targets domestic and foreign institutional investors, including corporations and investment partnerships. To manage the transition, the new rate applies to gains from shares acquired after the effective date, while for shares acquired prior to publication, the tax applies only to the portion of profit accrued between the publication date and the date of disposal.

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