Increased Withholding Rates on TL Deposits and Funds

A Presidential Decision published in the Official Gazette has introduced new regulations regarding withholding tax rates for Turkish lira deposits and funds. With this change, the withholding tax rates for deposits and funds with specific maturities have been increased. This regulation encompasses the withholding rates outlined in Article 67 of the Income Tax Law.

According to the regulation, the withholding tax rate for 6-month deposits has been raised from 7.5% to 10%. For deposits with maturities of up to 1 year, the withholding tax rate has increased from 5% to 7.5%. Meanwhile, for deposits with maturities longer than 1 year, which previously had a rate of 2.5%, the new withholding tax rate has been set at 5%. These changes will be valid until January 31, 2025.

Impact and Scope of the Changes The regulation represents a significant change in the taxation of Turkish lira savings. Deposit holders will be subject to the new withholding application in accordance with rates determined by their maturities. These rates will vary based on the maturity period, with new rates differentiated for 6 months, up to 1 year, and for maturities longer than 1 year.

The economic impacts of these changes and their reflections on the market will be closely monitored by deposit holders. The implementation is planned to remain effective until January 31, 2025. How this regulation will affect deposit holders and savers will be observed in the coming period.