background image
12.3.1. Main Rules

Turkey's controlled foreign company (CFC) rules apply when a Turkish resident or residents together directly or indirectly control 50% or more of the shares, voting rights or rights to receive dividends of a foreign company, and:

  • 25% of more of the CFC's income is comprised of passive income
  • The effective tax rate for the CFC is lowering that 10%
  • The annual gross revenue of the CFC exceeds TRY 100,000

If the conditions are met, the profits are apportioned to the Turkish resident based on the capital holdings of the CFC, whether distributed or not, and subject to corporate tax.