In this paper, the concept of collective investment institution and the regulations in Turkey that are in the Capital Markets Legistation intended for these institutions will be outlined, and tax advantages provided for collective investment institutions and investors and problems and suggestions occurred in the application will be discussed. The importance of collective investment institutions operating in the world under 3 legal structures, namely investment company, trust and contractual model to enable investors with low savings to operate in the financial markets has gradually increased in the countries’ economies. In Turkey, according to regulations in Capital Markets Legislation, collective investment institutions operate in two legal structures, namely investment companies and investment funds. Advantages provided to these institutions and investors in our tax legislation are as follows: For investors; participation income exemption in Article 5 and deduction in venture capital fund in Article 10 of Corporate Income Tax Law; deduction in venture capital fund in Article 89 of Income Tax Law; non-declaration of incomes and %0 rate of withholding tax for income obtained from participation certificates and stocks of some funds and companies in Provisional Article of 67, forcollective investment institutions; exception of portfolio management or corporate profits in Article 5 and %0 rate of withholding tax for exempted profits in Article 15 of Corporate Income Tax Law; %0 rate of withholding tax for exempted profits and no withholding tax for some incomes in Provisional Article of 67 of Income Tax Law, exception of BITT for the money and capital market profits of some institutions in Law on Taxes on Expenditure, exceptions of stamp tax for some papers in Stamp Tax Law. In conclusion, recommendations will be given as such; preparation of clear regulations regarding the provisions providing tax advantages to collective investment institutions, expansion of the scopes of existing tax benefits; applying no withholding tax to incomes derived by some institutions from their assets and transactions in order to avoid creating more costly result than investor’s direct investment, making regulations in respect of exceptions concerning Value Added Tax, Title Fees and Real Estate Tax for some investment fund and companies.