Primetax Guide: Ultimate Beneficial Ownership (UBO) in Türkiye

1. Legal framework and the meaning of beneficial ownership

The principal tax-reporting rules are contained in Tax Procedure Law General Communiqué No. 529. The Communiqué was originally based on the general information-gathering provisions of the Tax Procedure Law and on Türkiye’s international transparency commitments. In 2022, Law No. 7417 added an express statutory authorisation to Article 257 bis of the Tax Procedure Law for the Ministry of Treasury and Finance to determine the scope, content, timing and method of beneficial-owner reporting. General Communiqué No. 541 subsequently updated the legal-basis provision of Communiqué No. 529 to reflect that amendment.

For purposes of the Communiqué, the beneficial owner is the natural person or persons who ultimately control, or exercise ultimate influence over, a legal entity or an arrangement without legal personality. A legal entity can therefore never be the final beneficial owner. Where the immediate shareholder is another company, partnership, foundation, trust or similar vehicle, the ownership and control chain must be traced through that vehicle until one or more natural persons are identified, or until the fallback executive-authority test becomes relevant.

The 25% threshold is only the first test

For a legal entity, the first step is to identify natural persons who hold more than 25% of the shares. The wording is “more than 25%”; a holding of exactly 25% does not by itself satisfy the first ownership limb. That does not mean the individual can be ignored. A person with 25% or less may still be the beneficial owner if the facts show that the person ultimately controls the entity through voting arrangements, privileged management rights, contractual rights, family or concert-party arrangements, or another mechanism of influence.

Accordingly, beneficial ownership should be determined by looking through the formal legal ownership structure and asking who ultimately owns or controls the entity in substance. The shareholding test creates a practical starting point, not a safe harbour from the control analysis.

2. Who must report beneficial-owner information?

The reporting regime separates entities that have a recurring reporting obligation from institutions and professionals that may be required to provide client beneficial-owner information when requested by the Revenue Administration.

Corporate income taxpayers

Corporate income taxpayers, including entities in liquidation, are subject to the recurring reporting obligation. They report beneficial-owner information through their corporate provisional tax returns and their annual corporate income tax return. The Revenue Administration’s 2026 tax calendar continues to list the beneficial-owner form as an attachment to the relevant provisional and annual corporate tax returns.

Certain non-corporate entities and arrangements

The Communiqué also imposes direct reporting obligations on certain persons representing collective companies, ordinary partnerships, partnerships limited by shares without issued share capital, and foreign trusts or similar arrangements whose place of management is in Türkiye or which have a manager resident in Türkiye. These persons do not report through a corporate income tax return and are therefore subject to the separate annual electronic form requirement described below.

AML obliged parties - reporting on request

A much broader group of institutions and professionals listed by reference to the anti-money-laundering framework may be required to report the beneficial-owner information relating to transactions carried out by their customers when requested by the Revenue Administration. This group includes, among others, banks, finance and factoring companies, payment and electronic-money institutions, capital-markets institutions, insurers and leasing companies, real-estate and vehicle dealers and intermediaries, notaries, certain lawyers, independent accountants and auditors, crypto-asset service providers and savings-finance companies.

This second category should not be confused with the periodic filing obligation of a corporate taxpayer. An accountant, lawyer, bank or other obliged party does not file an annual beneficial-owner return for every client merely because it falls within the list. Its reporting obligation under Communiqué No. 529 arises when the Revenue Administration requests the relevant client-transaction information. Separate MASAK customer due-diligence obligations may of course apply continuously, as explained later in this guide.

3. How the beneficial owner of a legal entity is determined

The Communiqué establishes a three-stage hierarchy. The analysis should be performed in order and documented so that the company can explain why a particular natural person has been reported.

Stage 1 - ownership above 25%

Identify the natural person shareholders who directly or indirectly hold more than 25% of the shares. In a multi-tier structure, the immediate corporate shareholder is not the end of the analysis. The ownership chain should be traced through each intermediate entity until the relevant natural persons are identified. The company should retain an ownership chart and the supporting corporate records used to calculate the indirect interests.

Stage 2 - ultimate control

If no natural person holds more than 25%, or if there is reason to doubt that a person satisfying the shareholding test is the true beneficial owner, the analysis moves to the natural person or persons who ultimately control the legal entity. Control may arise independently of equity percentage. Relevant indicators can include decisive voting power, rights to appoint or remove management, veto or consent rights over key decisions, privileged management shares, contractual rights, financing arrangements or other circumstances that give a natural person effective influence over the entity.

This stage is particularly important in joint ventures, family groups, structures involving nominee or fiduciary ownership, private-equity arrangements and groups in which formal share ownership is dispersed but strategic decisions are concentrated in one person or a small group of persons.

Stage 3 - highest executive authority

Only where the beneficial owner cannot be identified through the ownership or ultimate-control tests should the natural person or persons with the highest level of executive authority be reported. This is a fallback identification rule, not a shortcut. A company should not report its general manager or board chair merely because tracing the ownership chain is administratively difficult. The underlying ownership and control analysis should first be performed and retained.

4. Direct and indirect ownership, control and executive authority

Indirect ownership is often where the practical work lies. A Turkish company owned by a foreign holding company should generally look through the holding company and each higher tier until the natural-person ownership is established. The percentage should be determined on the facts of the ownership chain, but the legal analysis does not end with arithmetic: control rights may produce a different answer from the economic share percentage.

Example - straightforward indirect ownership

Assume a Turkish company is wholly owned by Foreign HoldCo, and Individual A owns 60% of Foreign HoldCo. Individual A has a 60% indirect interest in the Turkish company and would ordinarily be identified under the first ownership test. If the remaining 40% of Foreign HoldCo is held by four unrelated individuals with 10% each and none has additional control rights, those individuals would not meet the more-than-25% ownership test merely by reason of their holdings.

Example - control without more than 25% ownership

Assume no shareholder holds more than 25%, but Individual B has contractual rights to appoint a majority of the board or to approve the company’s budget, financing and senior management. The absence of a shareholder above the 25% threshold does not end the analysis. Individual B may be the beneficial owner under the ultimate-control test.

Exactly 25%

An exact 25% shareholding is below the first limb because the Communiqué refers to holdings exceeding 25%. The company should nevertheless consider whether the person exercises ultimate control together with that holding or through other rights. Treating exactly 25% as automatically outside the UBO analysis would therefore be unsafe.

The same discipline applies when ownership is held through bearer shares, foundations, nominee arrangements or multiple related entities. The objective is to identify the natural person behind the structure, not simply to reproduce the immediate legal shareholder register.

5. Unincorporated arrangements, trusts and similar structures

The rules use a different hierarchy for arrangements without legal personality. For joint ventures and similar unincorporated arrangements, the natural person or persons who ultimately control the arrangement are treated as beneficial owners. If no such person can be identified, the person or persons with the highest level of executive authority are reported as the fallback.

For trusts and similar arrangements, the framework is broader and looks to the persons occupying the key roles in the arrangement. Founders or settlors, trustees, managers, auditors, beneficiaries and persons exercising influence over the arrangement are treated as beneficial owners for reporting purposes.

Cross-border trust structures require particular care because the terminology and legal roles may not map neatly onto Turkish concepts. The Turkish reporting should be prepared from the governing instrument, trustee records, protector or oversight rights, beneficiary classes and any other document showing who can control or benefit from the arrangement. A generic group organisation chart will rarely be sufficient on its own.

6. When and how the information is reported

Corporate income taxpayers

Corporate income taxpayers report beneficial-owner information in the annexes to their provisional corporate tax returns and annual corporate income tax return. The information should therefore be reviewed as part of every relevant return cycle rather than treated as a once-a-year corporate-secretarial exercise.

The 2026 Revenue Administration tax calendar confirms the continuing filing practice. For example, the beneficial-owner form accompanied the 2025 annual corporate income tax return due in April 2026 and the 2026 provisional corporate tax returns during the year.

Other persons with a direct annual filing obligation

Persons covered by the Communiqué who are not corporate income taxpayers must submit the separate beneficial-owner form electronically by the end of August each year. For the 2026 filing cycle, the Revenue Administration calendar shows 31 August 2026 as the deadline for the relevant non-corporate taxpayers and other persons.

Changes and new registrations

A new taxpayer registration or a change in previously reported beneficial-owner information must be notified within one month following the event. The one-month rule is important because the periodic return does not replace the obligation to report a material change when it occurs. Changes in ownership, a new ultimate controller or a change in the reported natural person should therefore be routed promptly to the tax-compliance team.

Electronic filing

The Communiqué requires electronic filing. The separate form is submitted through the Revenue Administration’s electronic tax platform and paper submissions are not accepted. Corporate taxpayers report through the relevant tax return annexes. The filing includes identification, citizenship and address information, available contact details and the reason why the person is treated as the beneficial owner.

7. Changes, corrections and record retention

Beneficial-owner compliance is not complete when the form is filed. The reported position must remain consistent with the legal and factual ownership structure, and the evidence supporting the conclusion should be retained in a form that can be produced during a tax audit or information request.

Corrections

If a filed notification is later found to be incomplete or incorrect, the Communiqué requires it to be corrected electronically using the prescribed filing method. A correction should not be delayed until the next periodic return where the company is already aware that the existing record is wrong.

Five-year retention under the Tax Procedure Law regime

The information forming the subject of the beneficial-owner notification must be retained for five years, calculated from the beginning of the calendar year following the year in which the notification is submitted. In practice, the supporting file should include not only the information entered in the form but also the records showing how the conclusion was reached.

What should be kept in the file?

A well-supported UBO file will normally include the current group ownership chart, shareholder registers or equivalent corporate records, articles or constitutional documents where control rights are relevant, voting and shareholder agreements, registers of directors or managers, trust or foundation documents where applicable, identification details of the reported natural persons and a short written explanation of the ownership or control route used for the filing.

For multinational groups, the Turkish entity should avoid relying solely on a global compliance database if the data does not show the chain necessary to support the Turkish more-than-25% and control tests. The local file should be capable of standing on its own.

8. Tax reporting and MASAK customer due diligence are separate

The term “beneficial owner” is also central to Türkiye’s anti-money-laundering framework. Under the Regulation on Measures Regarding Prevention of Laundering Proceeds of Crime and Financing of Terrorism, obliged parties must identify the beneficial owner of customers and take the necessary steps to verify the relevant information. MASAK guidance describes the same broad hierarchy of ownership, ultimate control and senior executive authority.

The practical purpose, however, is different. Communiqué No. 529 is a tax-information reporting regime administered by the Revenue Administration. The MASAK rules form part of customer due diligence and transaction monitoring under the anti-money-laundering legislation. A Turkish company’s tax notification does not relieve its bank, accountant, auditor, lawyer or other AML obliged party from independently identifying and, where required, verifying the beneficial owner.

This distinction also explains why an institution may ask for more evidence than appears on the tax form. MASAK states that ownership and partnership structure may be demonstrated by a range of materials, including shareholder registers, Trade Registry Gazette records, lists of attendees, Central Registry Agency records for bearer shares and other documents capable of demonstrating the relevant ownership. The evidence required in a particular onboarding or review exercise can therefore be broader than the fields submitted to the Revenue Administration.

Groups should aim for consistency across the two regimes. A difference between the UBO reported to the Revenue Administration and the person identified to a bank or other AML obliged party is not automatically wrong, because the factual inquiry and date may differ, but it should be understood and documented rather than left unexplained.

9. Penalties and the current judicial position

The penalty framework became more explicit in 2022. Law No. 7417 added Article 257 bis(1)(9) of the Tax Procedure Law, giving the Ministry specific authority over beneficial-owner reporting, and amended Article 355 bis so that non-compliance with obligations imposed under that provision is subject to three times the special irregularity penalty stated in paragraph (1)(1). General Communiqué No. 541 aligned Communiqué No. 529 with that statutory amendment.

2026 amount

For 2026, the special irregularity penalty amount in Article 355 bis(1)(1) is TRY 35,000. The statutory three-times multiplier for a failure relating to the beneficial-owner obligation therefore points to TRY 105,000. The application of penalties in a particular case should still be reviewed by reference to the specific failure, filing period and procedural history, including whether more than one separate breach is alleged.

2025 judgment of the Tax Litigation Chambers Board

A notable judicial development is the judgment of the Tax Litigation Chambers Board of the Council of State dated 19 March 2025 (E.2023/577, K.2025/137). The case concerned a challenge to provisions of Communiqué No. 529, including the penalty-related clause and the first-notification rule. The majority upheld the relevant provisions, while dissenting reasoning questioned whether the statutory framework in force when the Communiqué was originally issued in 2021 was sufficient for the continuous reporting obligation and its sanction.

For current compliance, the practical significance of that debate is limited by the 2022 legislative amendment, which introduced an express statutory power for beneficial-owner reporting and a specific penalty multiplier. Companies should therefore treat the 2026 reporting obligation as an active compliance requirement rather than relying on the historical debate concerning the pre-2022 legal basis.

10. Practical governance for Turkish and multinational groups

The most common compliance weakness is not the electronic filing itself; it is the absence of a reliable process for detecting ownership and control changes before the next tax return is prepared. The following governance approach is generally more robust.

Assign ownership of the UBO process

Responsibility should sit with a clearly identified function - typically tax, legal or corporate secretarial - with an agreed route for obtaining information from the parent company and foreign subsidiaries. The Turkish compliance team should know who within the group can confirm changes in shareholding, voting rights, shareholder agreements and senior executive authority.

Maintain a Turkish UBO analysis, not only a global ownership chart

A global chart is useful but does not itself explain why the Turkish reporting conclusion follows. The local file should record the natural persons above the 25% threshold, how indirect ownership was calculated, whether any separate control rights were identified, and why the senior-executive fallback was or was not used.

Build a one-month change trigger into corporate processes

Share transfers, capital increases, reorganisations, mergers, new shareholder agreements and changes in control rights should automatically trigger a UBO review. Where the reported information changes, the one-month notification period should be calculated from the relevant event rather than from the date on which the tax team later becomes aware of it.

Reconcile tax and AML records

Where banks, auditors, advisers or other obliged parties hold beneficial-owner information for the same Turkish entity, material differences should be investigated. This is particularly important in structures with nominees, trusts, private-equity funds, family arrangements or fragmented voting rights.

Retain evidence, not only the submitted form

The defence of a UBO filing depends on the records available at the time of review. A short contemporaneous memorandum explaining the ownership and control analysis can be more useful than attempting to reconstruct the reasoning several years later during an audit.