Receiving Your Pension in Turkey

When you live in Turkey there are no restrictions upon receiving any pension to which you are entitled in another country. It is, in essence, treated just like any other income - although it is sometimes taxed at a lower rate. The policy on this changes often.

There is no income tax on pensions in Turkey.

This applies equally to pensions paid by the government of another country and to private pensions, such as pensions from your former employment or generated by your accumulated pension investments.

The main problem with receiving your pension is that you will seldom be able to persuade your employer to convert it into Turkish lira and pay it into your Turkish bank account. Many will insist on paying it into an account in your own country.

Worse still, even if you can persuade the government or your former employer to convert your pension or pay it into your Turkish bank account, you will find that you will receive a lousy exchange rate.

So, many people choose to retain an account ‘back home’ into which these payments are made. They will, in any case, probably go home from time to time and so can use the money to pay for things there, without having the cost of first converting the funds into Turkish lira (when you receive them) and then back again.

On the hopeful assumption that your pension payments will exceed the amount of money you spend on your holidays, you can then arrange for the remaining funds to be transferred from that account to your account in Turkey a certain number of times each year. Usually, it’s better to wait until the sum to be transferred is measured in thousands rather than hundreds because this will make it easier to use an FX company and you’re likely to get a much better rate from them. However, some FX companies have special arrangements for transferring small but regular payments to a foreign destination and these can be very beneficial. You could, for example, commit to transferring (say) US$500 through them every month and they can set up systems to reduce the cost of this quite significantly. See our Guide to Moving Money & FX in Turkey.

When it comes to your pension income, you are likely to find that, occasionally, you will have to prove that you are still alive. It is all too easy for someone to move abroad and then for payments to continue to be made for decades after they have died! ‘Proof of life’ is usually done either by you going to the appropriate office in your home country when you are next there or by you submitting a statement (in a form that they provide) to the effect that you are still alive and then having this statement witnessed by (for example) a Notary or your doctor – as required by the company in question.

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