Turkish bank account details transferred to German tax authorities; 6 million diaspora face investigation

Under the Multilateral Competent Authority Agreement on Automatic Exchange of Financial Account Information that Turkey implemented on May 31, 2021, bank account details exceeding $1,000 held at Turkish banks are regularly transmitted to the tax authorities of countries where diaspora Turks reside. Over the past two years, data transfer has become fully automated and the frequency of transmission has increased significantly.

Turks in many European countries, particularly Germany, have begun receiving written notices from their countries of residence' tax administrations. German tax authorities are directing questions to individuals with funds in their accounts: "What is the source of this amount?" and "Why did you not declare it previously?" If the money was sent from Germany via bank transfer, the source can be verified and no problem arises; however, amounts brought in cash from Turkey or those of undocumented origin are creating grounds for money laundering investigations and tax evasion accusations.

The agreement was part of steps that enabled Turkey to be removed from the Financial Action Task Force's (FATF) grey list. A spokesman indicates that this regulation affects approximately 6 million diaspora members. Foreign residents who have income or accounts in Turkey need to review their tax obligations in their countries of residence.