The 1987 France-Türkiye tax treaty: what the text says

The convention between France and Turkey was signed in Paris on February 18, 1987, and entered into force on July 1, 1989. It covers only income taxes. Three points distinguish it: a withholding tax on dividends amounting to 20 % for an individual, a one-year rule for certain capital gains, and a capped French tax credit, the Turkish tax on which is calculated at rates provided for in the text (Article 23 § 2 b).

A text from 1987, without an addendum

The administrative list (BOI-ANNX-000306, April 29, 2026) lists the convention of February 18, 1987, for Turkey, with the notation "IR": income tax only, without any amendment or note. According to the BOFiP (BOI-INT-CVB-TUR), the convention was approved by Law No. 88-6 of January 4, 1988, and published by Decree No. 89-449 of June 30, 1989 (Official Journal of July 6, 1989). Turkey is not included in the list of conventions amended by the multilateral convention (BOI-ANNX-000511, April 29, 2026): the list therefore does not indicate any amendment to the 1987 text by the MLI.

Article 29 governs its application. In France, it applies to income earned from January 1, 1990. Article 2, paragraph 1, limits its scope to income tax. The text makes no mention of inheritances, gifts, or wealth tax.

Maximum deductions and key rules

Who is a resident? The four steps of Article 4 § 2

For a natural person resident in both States, Article 4 § 2 stipulates the following order:

1. a) the State where she has a permanent home; if she has one in both, the State with which her personal and economic ties are closest (centre of vital interests); ;
2. b) if this centre cannot be determined, or if she has no home in either, the State of habitual residence; ;
3. (c) if she habitually resides in both States or in neither, the State of which she is a national; ;
4. d) if she has the nationality of both States or of neither, the competent authorities shall decide by mutual agreement.

Dividends: 15 % for the company, 20 % for others

Article 10, paragraph 2, distinguishes between two cases. The 15% rate applies to a beneficial owner that is a company, other than a partnership, and that directly holds at least 10% of the distributing company's capital. In all other cases, including that of a natural person, the limit is 20%. The text refers to direct ownership.

Article 10 § 3 a provides for a payment from the French Treasury to a resident of Turkey who receives dividends giving entitlement to the tax credit, after deduction of the withholding tax in § 2 b. This provision does not apply to a resident of France who receives Turkish dividends.

Interest and royalties: 15 % and 10 %

Article 11, paragraph 2, caps the withholding tax at 15% of the gross amount of interest, and Article 12, paragraph 2, at 10% of the gross amount of royalties. Paragraph 3 of Article 12 defines royalties as: copyrights, patents, trademarks, designs, models, plans, secret formulas or processes, information relating to industrial, commercial, or scientific experience, and industrial, commercial, or scientific equipment. These caps apply to the beneficial owner of the funds.

Capital gains: the one-year rule

Capital gains on real estate are taxable where the property is located (Article 13, paragraph 1). For assets other than those listed in paragraphs 1 to 4, Article 13, paragraph 5, reserves taxation to the State of which the transferor is resident. It adds an exception: gains derived from the other State are taxable in that other State if the period between acquisition and disposal does not exceed one year. The one-year period applies before any transfer of property linked to Turkey. Paragraphs 2 to 4 of Article 13 (companies with real estate assets, permanent establishments, international transport) are not detailed here.

Salaries and liberal professions: two 183-day calculations

Both articles use 183 days, but not in the same way.

• Article 15 § 2, employees: the exception applies if the stay does not exceed 183 days during the calendar year, if the employer is not a resident of the other State and if the expense is not borne by a permanent establishment or a fixed base.
• Article 14 § 1, Liberal professions and other self-employed activities: Income is taxable only in the State of residence. It is also taxable in the other State if services are rendered there and if the resident habitually has a fixed base there, or if they remain there for 183 days or more during a period of twelve consecutive months. Only the portion attributable to that fixed base or presence is taxable there.

France: a capped tax credit, with rates stipulated in the legislation

Article 23, paragraph 2, provides that France grants a resident of France, on their taxable income in both States, a deduction equal to the income tax paid in Turkey. This deduction may not exceed the portion of French tax corresponding to income taxable in Turkey.

Section 2(b) specifies how this tax is calculated: it is calculated at 15 % for dividends under Article 10, Section 2(a), at 20 % for those under Section 2(b), at 15 % for interest, and at 10 % for royalties. If Turkish legislation applies a lower rate to these revenues paid to a non-resident, that lower rate applies. The text also specifies that the tax paid in Turkey includes the Turkish tax that would have been due, excluding any reduction or exemption granted by Turkish economic development incentive measures.

Turkish dividend of €10,000: numerical example (fictitious profile)

Situation. Karim, a fictional profile, residing in France, receives €10,000 gross in dividends from a Turkish company in which he holds a small share. He is not a company. Assumption: Turkey withholds tax at the maximum rate of 20%.

Issue. He wants to know the maximum withholding tax in Türkiye and the role of the tax credit in France.

Strategy. It applies the 20 % ceiling of Article 10 § 2 b, then the credit ceiling of Article 23 § 2 a. Two scenarios are presented for the French tax relating to this income: €3,000 in one case, €1,500 in the other. These amounts are assumed, without reference to any tax brackets.

Result. The maximum withholding tax is €2,000. With a corresponding French tax of €3,000, the tax credit is €2,000, leaving €1,000 of French tax payable. With €1,500, the tax credit is capped at €1,500, and €500 of the Turkish tax is not deducted. This calculation does not take into account social security contributions or any French reporting requirements.

What this page does not cover

It does not detail the protocol (eight points), Article 6 (real estate income), paragraphs 2 to 4 of Article 13, Articles 16, 17, 19 to 22, or the mutual agreement procedure and exchange of information (Articles 25 and 26). It does not describe Turkish tax law or social security. The amounts to be declared in France, for example on form 2047, are addressed in our pages on foreign income.

What changes depending on your situation

• Your residence as defined in Article 4, year by year.
• The nature of the income: dividend, interest, royalty, salary, self-employment, gain.
• Your status as an individual or a company, and your share of the capital.
• The time between the purchase and sale of an asset.
• The rate actually applied in Türkiye, which may be lower than the ceiling.

The rule depends on your situation. No results are guaranteed.