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Are you planning to earn from renting a property in sunny Turkey or already own one? Understanding the local tax system is the key to peace of mind and maximising your returns. Especially with the new regulations for short term rentals, awareness is more important than ever.
In this article, we will analyse in detail everything you need to know about property income taxation in Turkey in 2025. We will look at the current rates, tax relief options and the critical changes every owner needs to know.
Basic rental income tax (Gelir Vergisi) for 2025.
The main tax that affects your rental income is the personal income tax known as Gelir Vergisi. It is calculated on an annual basis and uses a progressive scale – the higher the income, the higher the rate.
Tax thresholds and rates for 2025
Tax thresholds in Turkey are updated annually. Here is the official scale for income earned in 2025 (to be declared in March 2026):
| Taxable annual income (TL) | Tax rate |
|---|---|
| Up to 158,000 TL | 15% |
| From 158,001 TL to 330,000 TL | 20% |
| From 330,001 TL to 1,200,000 TL | 27% |
| From 1,200,001 TL to 4,300,000 TL | 35% |
| Over 4,300,000 TL | 40% |
Disclaimer: Although these are the official rates, tax legislation may change. Always consult a qualified local accountant for final confirmation and personalized advice.
Tax exemption threshold (İstisna) – Your key opportunity!
One of the best news for residential property owners is the existence of a significant tax exemption threshold(İstisna Tutarı).
2025 exemption threshold: 47,000 TL
How does it work? If your total annual income from renting a home in Turkey is below this amount, you are completely tax-free and you don’t even have to file a tax return. If your income exceeds the threshold, then the whole amount becomes taxable, but you can apply one of the expense deduction methods to reduce your tax base.
How to reduce your tax: two strategic methods
If your rental income exceeds the 47,000 TL threshold, Turkish law allows you to choose one of two methods to reduce your taxable income:
A) Real deduction method (Gerçek Gider Yöntemi)
This method is ideal if you have significant and demonstrable costs on the property. You can deduct all actual and documented expenses, including:
- Repairs and maintenance (excluding improvements that increase the value of the property).
- Annual property tax paid(Emlak Vergisi).
- Required earthquake insurance (DASK) and other property insurance.
- Common areas maintenance fees(Aidat).
- Interest on a mortgage loan if the property was purchased with one.
- Agency commissions and management fees.
- Depreciation (standard 2% of the value of the building per year).
B) Fixed percentage cost deduction method (lump sum method)
This is the simplified version. You just deduct a fixed 15% of your gross rental income. You don’t have to keep invoices or prove expenses. This method is advantageous if your actual expenses are low or you just want to avoid the administrative work.
Important: Once selected, the method must apply to all your properties and cannot be changed in the following two years. Choose wisely!
The new law on short-term rentals (Airbnb type) – What do you need to know?
From 1 January 2024, the rules for letting properties for tourist purposes (any stay under 100 days) have changed dramatically. If you plan to rent out your property on platforms such as Airbnb or Booking.com, you must comply with the following mandatory requirements:
- Tourist Accommodation Certificate Licence: you must obtain this licence from the Ministry of Culture and Tourism. Renting without it is illegal and leads to fines of up to 1,000,000 TL.
- Tax registration:To obtain the license, you must have an active tax registration in Turkey.
- Invoicing: you are required to issue an invoice for each payment from a tenant.
- VAT (KDV): short-term rental income is considered a commercial activity and is subject to 20% VAT.
In practice, this turns short-term renting into an active business with serious administrative and tax obligations.
Practical steps and other duties
Filing a tax return
- Deadline: the 2025 income tax return is due between 1 and 31 March 2026.
- How to: file online through the Turkish Tax Administration system (Hazır Beyan Sistemi).
Other annual taxes
- Property tax (Emlak Vergisi): a low municipal tax (0.1% – 0.2% of the tax assessment) paid in two instalments in May and November.
- DASK Insurance: Compulsory annual earthquake insurance.
Avoidance of double taxation with Bulgaria (DTC)
The good news is that Bulgaria and Turkey have an agreement that prevents you from paying tax twice.
- The principle: Rental income is taxed first in Turkey.
- The mechanism: when you declare this income in Bulgaria, you apply the “tax credit method”. This means that the tax paid in Turkey is deducted from the tax due in Bulgaria. Since Turkish rates (15% and up) are higher than Bulgarian rates (10%), you will not actually owe any additional tax in Bulgaria.
Why do you need a local accountant (Mali Müşavir)?
Although not required by law for long-term rental income, hiring a qualified local accountant(Mali Müşavir) is the best investment you can make. He will:
- Advise you on which method of deducting expenses is most beneficial to you.
- Ensures your return is filed correctly and on time.
- represents you before the tax authorities.
- Is absolutely mandatory if you are dealing with short term rentals because of the complex VAT requirements.
Conclusion.
Property investment in Turkey continues to be attractive but requires awareness and good planning.
- Keep an eye on the exemption threshold: the 2025 figure of TL 47,000 could save you tax.
- Choose a spending strategy: decide whether the actual deduction method or the flat-rate method is better for you.
- Be careful with short-term rentals: the new law is strict and requires full compliance.
- Don’t miss the deadline: declare your income by 31 March of the following year.
- Consider professional help: an accountant is your best partner for tax efficiency and peace of mind.
This post is also available in: Български
