Tax on Investment Income in Turkmenistan

Investment income in Turkmenistan is subject to varying tax treatments depending on the type of income and the taxpayer's status. This guide covers the taxation of dividends, interest, rental income, and other investment returns.

Dividend Income

Individual Taxation

Dividends received by individual residents are tax-exempt at 0%. This makes dividend income particularly attractive for resident investors. Non-residents are subject to a 10% withholding tax on dividends.

Corporate Taxation

Dividends received by a resident company from another resident company may qualify for exemption. Foreign-source dividends are taxable at the standard CIT rate of 20% (or 8% for small businesses), with a foreign tax credit available.

Interest Income

Individual Taxation

Interest income earned by individuals is tax-exempt at 0% for residents:

• Bank deposits: 0%
• Government bonds: 0%
• Corporate bonds: 0%
• Private loans: 0%

Corporate Taxation

Interest income received by corporations is included in taxable income and taxed at the standard CIT rate of 20%. Interest expense is generally deductible.

Rental Income

Rental income from immovable property is taxed as follows:

• Individuals: Net rental income is subject to flat PIT rate of 10%
• Corporations: Rental income is included in business income and taxed at 20%
• Withholding Tax: 10% withholding on rental payments to non-residents

Landlords may deduct expenses including maintenance, property management fees, insurance, and interest on mortgages.

Capital Gains

Capital gains on investments are taxed as ordinary income at the flat PIT rate of 10% for individuals and 20% CIT for corporations. There is no separate CGT regime.

Foreign Investment Income

Turkmenistan taxes residents on their worldwide income. Foreign investment income is generally taxable in Turkmenistan, with a foreign tax credit available for taxes paid abroad under applicable treaties.