Foreign Investor Guide
Reference: Presidency of the Republic of Turkey Investment office www.invest.gov.tr
LIBERAL INVESTMENT ENVIRONMENT
Turkey's investment legislation offers equal treatment to all investors, as well as compliance with international standards and simplicity.
The basis of the investment legislation is the Law on Incentives of Investments and Employment No.5084, Foreign Direct Investments Law No.4875, Foreign Direct Investments Law Implementation Regulation, multilateral and bilateral agreements, and various laws regulating the incentives of investments on a sectoral basis and related sub-regulations.
- Foreign Direct Investment (FDI) Law
- The purpose of the Foreign Direct Investment (FDI) Law No. 4875 is as follows:
- Promoting foreign direct investments in the country
- Protecting the rights of investors
- Bringing investor and investment definitions to international standards
- Establishing a notification-based system for foreign direct investments instead of a consent-based system
- To increase the volume of foreign direct investments through established policies and procedures
The FDI Law provides a definition of foreign investors and foreign direct investments. In addition, this law also explains the important principles of foreign direct investments such as freedom of investment, national treatment, expropriation and nationalization, free transfer of profit, national and international arbitration and alternative dispute resolution methods, valuation of non-cash capital, employment of foreign personnel and liaison offices.
In the FDI Law Implementation Regulation, the procedures and principles regarding the subjects included in the FDI Law are specified. The goal of the FDI Law on work permits for foreigners:
- Regulating the work carried out by foreigners
- To determine the terms and conditions regarding the rules on work permits granted to foreigners.
81 BILATERAL INVESTMENT AGREEMENT
Afghanistan, Germany, United States of America, Argentina, Albania, Australia, Austria, Azerbaijan, Bahrain, Bangladesh, Belgium-Luxembourg, Belarus, United Arab Emirates, Bosnia-Herzegovina, Bulgaria, Czech Republic, Turkey, Denmark, Estonia, Ethiopia, Morocco, Philippines, Finland, France, Guatemala, South Korea, Georgia, Croatia, India, Netherlands, England, Iran, Spain, Israel, Sweden, Switzerland, Italy, Japan, Qatar, Kazakhstan, Kyrgyzstan, Kosovo, Kuwait, Cuba, Latvia, Libya, Lithuania, Lebanon, Hungary, Macedonia, Malaysia, Malta, Mexico, Egypt, Mongolia, Moldova, Mauritius, Uzbekistan, Pakistan, Poland, Portugal, Romania, Russia, Senegal, Serbia, Singapore, Slovakia, Slovenia, Syria, Saudi Arabia, Tajikistan, Tanzania, Thailand, Tunisia, Turkmenistan, Ukraine, Oman, Jordan, Vietnam, Yemen, Greece.
Source: Ministry of Trade
Prevention Of Double Taxation Agreements
Turkey has signed Prevention Of Double Taxation Agreements (ÇVÖA) with 85 countries that allow the deduction of a tax paid in one of the two countries from the tax payable in the other, thereby avoiding double taxation.
Turkey continues to expand the scope of the Prevention Of Double Taxation Agreements by adding new ones to the countries that are party to this agreement.
85 Prevention Of Double Taxation Agreements
Germany, United States, Albania, Australia, Austria, Azerbaijan, Bahrain, Bangladesh, Belgium, Belarus, United Arab Emirates, Bosnia and Herzegovina, Brazil, Bulgaria, Algeria, Czech Republic, Turkey, Denmark, Indonesia, Estonia, Ethiopia, Morocco , Philippines, Finland, France, Gambia, South Africa, South Korea, Georgia, Croatia, India, Netherlands, UK, Iran, Ireland, Spain, Israel, Sweden, Switzerland, Italy, Japan, Canada, Qatar, Kazakhstan, Kyrgyzstan, Kosovo, Kuwait, Turkish Republic of Northern Cyprus, Latvia, Lithuania, Lebanon, Luxembourg, Hungary, Macedonia, Malaysia, Malta, Mexico, Egypt, Mongolia, Moldova, Norway, Uzbekistan, Pakistan, Poland, Portugal , Romania, Russian Federation, Serbia and Montenegro, Singapore, Slovakia, Slovenia, Sudan, Syria, Saudi Arabia, Tajikistan, Thailand, Tunisia, Turkmenistan, Ukraine, Oman, Jordan, Vietnam, Yemen, New Zealand, Greece.
Source: Revenue Administration (GİB)
Social Security Agreements
Turkey has signed Social Security Agreements with 30 countries, and these agreements facilitate the movement of workers outside their own countries between countries. The number of these countries will increase due to the expanding range of FDI source countries.
30 SOCIAL SECURITY AGREEMENT
Germany, Albania, Austria, Azerbaijan, Belgium, Bosnia-Herzegovina, Czech Republic, Denmark, France, South Korea, Georgia, Croatia, Netherlands, England, Sweden, Switzerland, Italy, Canada and Quebec Province, Montenegro, Turkish Republic of Northern Cyprus, Libya, Luxembourg, Hungary, Macedonia, Norway, Romania, Serbia, Slovakia and Tunisia.
Source: Social Security Institution (SSI)
Total Tax and Contribution Rate * - 2018 (% of profit)
Turkey's investment climate has improved significantly in recent years and has reduced the tax burden with an internationally competitive tax system.
Source: World Bank
International Tax Competitiveness - 2018 (Index = 100 as most competitive **)
* Total Tax Rate: Profit or corporate tax, social contributions and labor taxes paid by the employer, real estate taxes, turnover taxes and other taxes (such as municipal fees and vehicle taxes).
Source: Tax Foundation
** Tax competition measures the tax policies of countries in five categories: corporate income tax, excise taxes, property taxes, individual taxes, and international tax rules.
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