Every expat who works or sells property must be fluent in the double taxation rules. This article is an expat’s tax guide on what a Double Taxation Agreement is. Read on and don’t pay more than you should.
Double Taxation Agreement meaning
Who falls under the treaty
Types of income covered
How it works in real life
Why it matters for expats
FAQ
What does a Double Taxation Agreement mean?
A Double Taxation Agreement is a treaty between two countries that sets the rules for where your income should be taxed, depending on your residency. The purpose here is straightforward: the Double Taxation Agreement prevents expatriates from paying tax twice on the same income. You pay either in Turkey or the UK.
Explore:
Who falls under the UK-Turkey Double Tax Treaty
Before diving into the specific double taxation rules, we should understand to whom these regulations apply. If you:
- live in the UK but earn income in Turkey, or
- live in Turkey but receive income from the UK,
- you split your life between both countries and need clarity on where to file your taxes.
Then, you definitely should go through the treaty to avoid double taxation.
Types of income covered by the UK-Turkey Double Tax Treaty
Not every type of income is covered by the agreement. However, the most common ones are:
- Employment income – salary from a job in Turkey or the UK.
- Self-employment or business income.
- Rental income from property located in either country.
- Capital gains, including the sale of property.
- Pensions.
- Dividends, interest, and royalties.
Some are never taxed twice, others can be taxed partially, like 10% on royalties. You can find the type of income you’re interested in and study the details in the official text of the UK-Turkey Double Tax Treaty.
How it works in real life
The core idea of the Double Taxation Agreement is simple – you must identify to which country your tax belongs and not pay it twice. What's confusing is the choice of the country. If you're a Turkish expatriate in the UK, this is how it works in your case:
| The type of income | How it’s taxed |
|---|---|
| Income from a job in the UK | You pay tax in the UK. |
| Rental income from property in Turkey | Turkey taxes it first (because the property is located there). The UK may also tax it, but you receive a credit for the tax already paid in Turkey — so no double taxation. |
| Selling property in Turkey | Turkey can tax capital gains on Turkish property. The UK may also tax it, but you get tax relief to avoid being taxed twice. |
| Income from Turkey-based companies or freelancing | Turkey may tax it first; the UK gives you a tax credit so you don’t pay double. |
| Turkish pension | Usually taxed in the country of residency — the UK. Some pension types may have special rules, so it’s worth checking your specific case. |
The same logic applies the other way around.
Why the UK-Turkey Double Tax Treaty matters for expats
Knowing how the agreement works helps you:
- Avoid paying tax in two countries,
- Understand where you legally owe taxes,
- Plan your income, property sales, or retirement withdrawals wisely,
- File correctly and avoid penalties.
The treaty to avoid double taxation may sound complicated, but once you understand the basics, you’ll see they’re created to protect you, not confuse you.
Money saved on taxes can be used for good – supporting your family back home. You can send money from the UK to Turkey in minutes and at beneficial rates once you join Profee. This online service is trusted by over 800,000 expats who already send funds in a relaxing and convenient way. Learn more about the UK-Turkey transfers here.
FAQ – the meaning of the Double Taxation Agreement
What does a Double Taxation Agreement mean?
Here is the double taxation agreement meaning: a treaty between two countries that ensures you don’t pay tax twice on the same income.
What are the benefits of a treaty to avoid double taxation?
You don’t pay twice on the same income. Expats face enough financial burden, so some reliefs are of great help.
When did the UK-Turkey Double Tax Treaty enter into force?
On October 26th, 1988.
What is a simple definition of ‘treaty’?
Formal, usually written, agreement.
How does HMRC check residency?
If you spend 183 or more days per year in the UK, you automatically become a tax resident. However, if you have a family member who is a UK citizen, or you work or own property there, the number of days spent is reduced.
