WITHHOLDING TAX RATE FOR CORPORATE INVESTORS ON MONEY MARKET FUND INCOME SET AT 10%
Presidential Decision No. 11734, published in the Turkish Official Gazette dated 5 September 2026 and numbered 33361, amended the withholding tax rates applied under Provisional Article 67 of the Income Tax Law. The amendment directly affects resident and non-resident corporate investors deriving income from money market funds and free funds whose names include the expression “money market”.
10% Rate for Corporate Investors on Money Market Funds
For capital companies within the scope of Article 2/1 of Corporate Tax Law No. 5520, as well as taxpayers operating solely to derive returns and capital gains from securities and other capital market instruments and determined by the Ministry of Treasury and Finance to be comparable to investment funds and investment companies, income derived from participation units of money market funds and free funds whose names include “money market” will be subject to withholding tax at 10%.
0% Rate Continues for Other Income
For the corporate investors described above, the withholding tax rate applicable to other income falling within the relevant regulation will continue to be 0%.
Fund Units Acquired On or After 5 September 2026
The new 10% rate applies to income from participation units of money market funds and free funds whose names include “money market” acquired on or after 5 September 2026, the publication date of the Decision.
Transitional Rule for Fund Units Acquired Before 5 September 2026
For qualifying fund units acquired before 5 September 2026, the 10% withholding tax will not apply to the entire gain. Only the portion of the gain attributable to the period from 5 September 2026 until the disposal date will be subject to 10% withholding tax.
Points to Consider in Practice
Companies should track acquisition dates separately for investments in money market funds and relevant free funds. In particular, for units acquired before 5 September 2026, the allocation of the gain under the transitional rule should be verified upon disposal, together with the withholding applied by banks or intermediary institutions.
Presidential Decision No. 11734 entered into force on its publication date. Companies holding money market fund investments should review their existing portfolios by acquisition date and verify the applicable withholding tax rates accordingly.
