Articles
Company Registration in Turkey
Updated on Friday 10th February 2023 We are a company registration agent in Turkey, serving clients from any part of the world looking to expand to the important Turkish market. Our team consists of Turkish company formation agents, consultants, and accountants who will work together to will help you set up a company in Turkey.
Since 2011, our firm - CS Yonetim ve Destek Hizmetleri - has expanded its activity in order to better respond to clients' requests. Its areas of expertise include: company registration, accounting and tax advisory services oriented towards foreign clients looking to set up operations in Turkey.
| Quick Facts | |
|---|---|
| Types of companies | Limited Liability Company (LTD) Joint Stock Company (AS)
|
| Minimum share capital for LTD Company | 10.000 TL - No prepayment for capital, it can an be paid in 2 years. |
| Minimum number of shareholders for Limited Company | 1 |
| Time frame for the incorporation | 3-4 days for individual shareholders 7-8 days for legal entity shareholders |
| Corporate tax rate | 25% for 2021 and 23% for 2022 |
| Dividend tax rate | 15% |
| VAT Rate | 1% 8% 18% |
| Are shelf companies available? | No |
| Do you supply a registered address/virtual office? | Yes |
| Local director required | No |
| Annual meeting required | No |
| Redomiciliation permitted | Yes |
| Electronic signature | No |
| Is accounting/annual return required? | Yes |
| Foreign-ownership allowed | Yes, 100% |
| Any tax incentives (if applicable) | No |
| Any tax exemptions available? | No |
We provide company incorporation services for investors who wish to start a business in Turkey in any of the country's major cities.
Types of companies in Turkey
The types of companies that can be chosen for company formation in Turkey are:
- • the joint-stock company, which is usually used by investors interested in setting up large operations in Turkey;
- • the limited liability company, which can be private or public, however, the private type is usually employed by foreign enterprises;
- • the commandite company is a non-corporate business form and is the equivalent of the limited partnership in other countries;
- • the collective company is also a non-corporate type of structure and can be registered by natural persons only;
- • the cooperative company is one of the oldest and also one of the most popular types of companies in Turkey.
The limited liability company is the most popular form of business. At least one shareholder is required to form this type of company and a minimum share capital of 10,000 TRY will also have to be deposited during the initial phase of the incorporation process. The liability of the shareholders is limited to the amount of share capital invested in the company.
The joint stock company has a larger minimum share capital than the limited liability one - 50,000 TRY. This type of company has different rules regarding the company management process: it must have at least one shareholder and a mandatory board of directors. The liability of the members is limited to the amount of invested capital and the capital is divided into stocks which can be made public when the company is listed on the Stock Market. This type of company is more suitable for large businesses.
A commandite company, or limited partnership, allows one or more partners to have unlimited liability for the debts of the company, while other partners have limited liability. The partners with unlimited liability are fully responsible for the company's debts, while the limited partners have a financial investment in the company but are only responsible for their investment. This is a great business type forinvestment purposes, often chosen by those who wish to start a business in Turkey. Limited partners provide capital and unlimited partners manage the business operations.
In a collective company structure, all partners have unlimited liability for the debts of the company. This means that each partner is personally responsible for the company's debts, regardless of the amount of their contribution to the business. Collective companies are often used for small businesses where all partners have the right to make decisions and manage the business. If you are interested in starting a small business in Turkey, please contact one of our agents for a detailed consultation.
The cooperative company is owned and controlled by its members, who are also the customers or users of its services. Profits are distributed among the members based on their level of participation, rather than being owned by outside shareholders. Cooperatives are often used in the agriculture, retail, and banking industries.
Other business options for investors include branches or subsidiaries in Turkey. Our company formation agents in Turkey can give you detailed information about each type of company.
We invite you to watch a video about how to open a company in Turkey:
Documents needed for company formation in Turkey
The documents required for registering a company in Turkey depend on whether the shareholder or shareholders are individuals or companies. In the case of individuals, two copies of their passports or IDs must be filed upon registration. In the case of legal entities, the following documents are required for company formation in Turkey:
- • the foreign company’s Articles of Association, which must be translated into Turkish and notarized;
- • the foreign company’s Certificate of Registration which must also be translated and notarized;
- • a resolution of the company’s management board for creating a company in Turkey;
- • information about the person in the foreign company who will represent it at the Turkish business’ administration;
- • information about the company’s manager or managers and their passport copies.
Company managers must also be appointed in companies that have individuals as shareholders. Our company registration advisors in Turkey can offer more information on all the documents which must be prepared when setting up a business in this country.
Company incorporation steps in Turkey
The following steps need to be completed when registering a company in Turkey:
- selecting a business form which respects the requirements of the Company Law in Turkey - our agents can help;
- reserve a trade name for the company to be incorporated - the name must be unique and can be verified prior to the reservation;
- prepare the documents which need to be filed with the Turkish Trade Register in order to obtain the Certificate of Registration;
- opening the company's bank account in which the share capital will be deposited prior to the registration;
- filing the incorporation documents, obtaining the tax identification number and the VAT number, and registering for employment.
Tax registration for companies in Turkey
Tax registration is one of the company registration steps in Turkey. This step is very important because it will allow the company to account for all its commercial transactions. The following documents are required for tax registration as a company in Turkey:
- The company’s Articles of Association in original.
- The request form issued by the local tax office in Turkey.
- The document indicating the company’s local address.
- A power of attorney, if the process is concluded by a third party, such as our agents.
We can help with the whole company formation procedure in Turkey. This process can include the registration of the company with the Trade Register, the opening of the bank account and the tax registration procedure.
If you have a company and want the services of accountants in Turkey, we advise you to contact our specialists. They can deal with various procedures, including payroll, bookkeeping, audits, HR management, and financial and analysis reports, among others. You should also know that financial expertise is provided by our certified accountants. But everything you need to know about this type of service, you can find out from one of our specialists.
Applying for business licenses in Turkey
The business licensing phase must be completed if the Turkish company will undertake certain activities. In this case, specific business licenses and permits must be obtained with the authorities representing the industry the company will operate in. Among the industries in which special licenses and permits are necessary are trading, the financial industry, and manufacturing. We kindly invite you to get in touch with our company registration consultants in Turkey for personalized advice on how to start a business.
Payroll in Turkey is part of the accounting matters necessary for a company. With such services, you can guarantee that everything related to the preparation and payment of salaries is done according to the legislation in force. We mention that before the salaries are distributed, the taxes to be paid will be calculated, both from the employee's side and from the employer's side. You can discuss more in this direction with one of our accountants.
Set up a company in Turkey as a sole trader
If you want to start a business in Turkey, you can also become a sole trader. Sole proprietorship means a single individual is responsible for all aspects of the business, including ownership, management, and liability. The owner of a sole trader business in Turkey is entitled to keep all profits after paying taxes and expenses.However, the sole owner is still fully responsible for managing the day-to-day operations of the business and making decisions on its behalf.
The procedure of becoming a sole trader is similar to the other company incorporations in Turkey, but other documents are also required.In the case of becoming a sole trader, the company's representative becomes the sole proprietor. We can guide you to ensure that you complete all the necessary steps correctly.
Changing the business type in Turkey
It is also possible to change the business type of a company in Turkey. If you plan to change the business activity you can also do that, but you need to obtain additional permits or licenses and respect the requirements for that business activity.
To start a business in Turkey, you need to prepare the required documents that attest to the change in the type of liability for partners, for example. The documents have to be notarized and submitted to the Trade Registry Office. After the procedure has been accepted, you will be required to update the company's registration and notify other relevant authorities.
Changing the company type is a process that can be handled by our team of accountants and experts in company formation in Turkey. Our team will offer the correct guidance for this procedure since it can vary depending on the industry your business operates in.
Company formation costs in Turkey
Apart from the startup costs, the following costs related to the registration of a Turkish company must be considered:
- The virtual office fee is 100 EUR per month;
- The company formation fee requested by our local agents in Turkey starts at approximately 2,950 EUR for individual shareholders;
- The accounting services and tax consultancy services offered by our accountants in Turkey start at around 350 EUR per month, depending on the requirements of the client;
- The bank account opening assistance services offered by our local agent is 750 EUR per account in each bank.
If you would like to know more about investing in Turkey and what the country has to offer, you can get in touch with our company formation agents in Turkey.
Rules and regulations for companies in Turkey
The Commercial Code introduces provisions regarding good management practices and requirements for an internal and independent audit. A company must base its economic and business activities on transparency, fairness, accountability, and responsibility. The Code contains guidelines regarding:
- the mandatory financial statements a Turkish company must prepare and file with the tax authorities;
- the organizational structure of the company which comprises the shareholders and the company directors and managers;
- the annual audit process – Turkish companies must have their financial accounts audited;
- the company’s shareholders, also known as stockholders, are the owners of the company;
- the structural changes within the company must be reported to the Trade Register in Turkey;
- the division/split-up of a company must also be reported to the Companies Register;
- the Company Law also provides for the liquidation of companies in Turkey.
These provisions, together with the Articles of Incorporation belonging to a company incorporated in Turkey are the basis for corporate governance in the country.
Business in Turkey for foreigners
Business in Turkey for foreigners is quite appealing from many points of view. With leading producers in sectors like agriculture, automotive, textile, and construction, Turkey aligns with top business destinations worldwide. Foreign entrepreneurs in Turkey can benefit from relaxed investment legislation that allows them to start a business in a fast manner, without complicated bureaucracy. Cities like Ankara, Istanbul, or Izmir are quite appreciated from a business point of view by foreigners in Turkey. Low operating costs, a skilled and multilingual workforce, strong consumer spendings, a large number of local manufacturers to collaborate with, the support offered by the Turkish government, and a beneficial geographic location are a few of the main solid points of Turkey. The benefits do not stop here, as foreigners can easily gain Turkish citizenship through varied beneficial programs and specific investments.
Foreigners obtain a residence permit and a tax number, then register the company with the Trade Registry Office. One of the benefits of starting a business in Turkey include taking advantage of the country's well-developed transportation and logistics infrastructure and itsposition at the crossroads of Europe, Asia, and the Middle East. This makes it a great strategic gateway for these regionsto reach a large and diverse market. The Turkish government provides a range of support and incentives for foreign businesses, including tax exemptions and reduced corporate tax rates. There are also loans, grants, and investment incentives for foreign businesses investing in Turkey.
Real estate is a great investment for foreign businesses in Turkey. The country has a growing population, which has led to increased demand for housing and other real estates. It is also worth mentioning the strong tourism industry, which has led to increased demand for hotel rooms and other types of real estate for tourists. There are also favorable regulations issued by the Turkish government for real estate investment, making it easier for foreign investors to enter the market. If you are interested in learning more about the the process of company formation in Turkey, including in the real estate market, please contact one of our professional legal advisors.
Business in Turkey for foreigners is a straightforward process. You might want to pay attention to some facts and figures that highlight the business and economic direction of Turkey:
• In terms of total FDI stock for 2021, Turkey registered nearly USD 145.8 billion.
• Around 60% of the total FDI stock is directed to sectors like manufacturing, finance, and energy.
• Italy was one of the main investors in Turkey, leading capital investments worth EUR 997 million in 2020.
• Turkey's economy has been growing rapidly in recent years, and it is now the world's 20th largest economy by nominal GDPwhich encourages foreign entrepreneurs to start a business in Turkey.
Frequently asked questions
1. What are the types of companies that can be incorporated in Turkey?
The joint-stock company, the limited liability company, the collective and commandite companies, the cooperative or the branch are all options for a legal entity in Turkey.
2. Can a foreigner open a company in Turkey?
Yes. Foreigners have equal rights to open companies, just as nationals. Turkey welcomes foreign investments in various business fields.
3. How fast can you start a new business in Turkey?
A business can be incorporated in one week if all the documents are in order.
4. Does the company need to have an office in Turkey?
Yes. A registered office is necessary for a newly incorporated company in Turkey. This also applies for branches of foreign companies.
5. What are the steps for company incorporation in Turkey?
The business owner must draw up and submit the Articles of Association, notarize the company documents, deposit the minimum share capital and apply for registration at the Trade Registry Office.
6. What is the minimum share capital in Turkey?
The minimum share capital depends on the type of company. This amount is larger for joint stock companies than for limited liability companies: 50,000 TRY as opposed to 10,000 TRY.
7. What are the requirements for opening a bank account in Turkey?
The bank account is mandatory for the company because the share capital is deposited upon incorporation. Banks will generally request the registration certificate of the company and other documents attesting the identity of the founding members. Certain fees apply, as per the bank’s policy.
8. Do you need special permits and licenses in Turkey?
Yes. For example, import and export activities are regulated and business owners engage in this activity based on certain permits obtained before starting the actual trading.
9. What are the taxes for companies in Turkey?
The corporate tax in Turkey is 20%, but lower rates can apply. A payroll tax, real property tax, social security tax and other taxes also apply.
10. What are the reasons to invest in Turkey?
A good location between two important markets, its own large domestic market, good economy, an open investment climate and good infrastructure are important reasons why investors should choose to open a company in Turkey.
11. Can you change the business type in Turkey?
You can change the business types in Turkey if you provide the required documents that attest the conversion.
12. Is it possible to become a sole proprietorship in Turkey?
Yes, it is possible to set up a company in Turkey as a sole trader by following a similar procedure as opening other business types.
Foreigners interested in starting a business in Turkey are invited to contact our Turkish company formation agents and solicit complete support and guidance.
Choosing our specialists in Turkey
Interested in a fast and easy company incorporation process in Turkey? You are invited to discuss all the aspects with our team of company formation agents in Turkey who work with complete professionalism and proficiency to offer a suitable solution for international investors. It is essential to know the business direction and rules of a foreign country before making investments and this is also the case of Turkey. All the business-related aspects can be completely explained by our specialists right from the beginning of our collaboration, as soon as you decide to start a business in Turkey.
Companyformationturkey.com is part of an international network which has affiliated partners throughout the world, such as Polish lawyers, attorneys in Turkey, agents in company formation in Romania and in Luxembourg and solicitors in Bucharest.
Meet us in Istanbul
Call us now at +90 532 351 66 77 to set up an appointment with Cagatay Altunsoy, one of our specialists in company formation in Istanbul, Turkey. Alternatively you can incorporate your company without traveling to Turkey.
As a client of CS Yonetim, you will benefit from:
- - 24 hour response time guaranteed;
- - cost- efficiency;
- - dozens of articles and free information on the Turkish structures.