Türkiye provides information about Turkish bank accounts
to German tax authorities

Until now, the German tax authorities had no knowledge of money held in Turkish bank accounts. Since 2014, agreements have been in place between numerous countries to combat tax evasion and fraud, allowing them to automatically and electronically exchange information about bank accounts – including account numbers, balances, interest, dividends, and other income. Turkey joined the agreement in April 2017 but did not transmit any data for years. Following a presidential decree, Turkey has been transmitting tax data to the German tax authorities since September 2021.

How does the German tax office become aware of Turkish income?

The German tax authorities receive information on investments and income from Turkey primarily through the automatic exchange of financial information (AEOI), international administrative assistance, bank and control notifications, and digital reconciliations during tax returns. It is not only Ziraat Bank that shares information from its private and corporate clients, but all branches of all Turkish banks, such as Garantie, Vakif, Akbank, etc., participate in the information exchange.

Automatic exchange of information

Turkey participates in the OECD Common Reporting Standard (CRS), which requires Turkish banks and financial institutions to transmit account information and certain shareholdings to the German Federal Central Tax Office annually. This applies not only to current accounts but also to fixed-term deposits, overnight deposits, and savings accounts. It is completely independent of whether the accounts are managed via online banking or an app, and regardless of whether the account is newly opened. The information reported includes account balances, capital gains, account holder information, and tax residency.

International administrative assistance and exchange between authorities

In cases of suspicion or need for investigation, the German tax office can directly request administrative assistance from the Turkish authorities and will then also receive relevant information on company holdings, real estate ownership and transactions.

As part of tax audits, German and Turkish authorities also exchange targeted information, for example about large money movements, real estate sales or irregularities in the tax return.

Control notifications and banks

Banks report larger transfers to Germany to the German tax authorities. Suspicious money flows or real estate income can trigger a compliance audit. German banks are also obligated to report foreign assets and related income if any irregularities are detected.

Digital reconciliations and tax return

In their tax return, taxpayers must disclose all foreign investments and income; the tax office can digitally compare this information with data received through international exchange and specifically check for irregularities.

Missing or incomplete information is increasingly being detected through data matching, which may lead to investigations, audits, and potentially criminal proceedings.

Conclusion:

The German tax office receives – often automatically – detailed information about foreign investments and income of its taxpayers, particularly from Turkey, and can thus effectively uncover violations of reporting and tax obligations. Call us if you receive any correspondence from the tax office.