Establishing a Company in Turkey
Establishing a Company in Turkey: A Guide for Foreign Investors
Starting a business in Turkey can be an excellent move for foreign investors, given the country’s strategic location, skilled workforce, and favorable trade policies. This guide outlines the essential steps and requirements for establishing a company in Turkey.
Types of Companies in Turkey
The most common company structures for foreign investors are:
- Limited Liability Company (LLC): Common for small and medium enterprises, requiring a minimum capital of 10,000 Turkish Lira and one or more shareholders.
- Joint Stock Company (JSC): Preferred for larger businesses, with a minimum capital requirement of 50,000 Turkish Lira and at least one shareholder.
- Branch Office: Allows an existing foreign company to conduct business in Turkey without setting up a separate legal entity.
- Liaison Office: Designed for companies seeking to establish a presence in Turkey for market research, but not permitted to conduct commercial activities.
Step-by-Step Process for Company Registration
- Prepare the Required Documents
- The following documents are essential for company registration:
- Articles of Association
- Notarized copies of shareholder passports
- Proof of address for the company headquarters
- List of company directors and their personal details
- Application forms and necessary declarations
- These documents must be prepared and translated into Turkish, and some require notarization.
- The following documents are essential for company registration:
- Obtain a Tax Identification Number
- Register for a tax identification number at the local tax office. This number is essential for conducting business and financial transactions in Turkey.
- Deposit Initial Capital
- For LLCs, a minimum of 25% of the total capital must be deposited before registration. For JSCs, the initial capital amount may vary, but at least 50% should be deposited within three months of incorporation.
- Register with the Trade Registry
- Submit the required documents to the local Trade Registry Office. Once approved, the company is officially incorporated, and details are published in the Turkish Trade Registry Gazette.
- Register for Social Security
- New companies must register with the Social Security Institution to provide social security coverage for employees.
- Open a Corporate Bank Account
- A Turkish corporate bank account is essential for financial transactions and allows for smoother operations, particularly for salary payments and daily business activities.
Legal Compliance and Business Operations
- Tax Compliance: Companies in Turkey are subject to corporate income tax, VAT, and other applicable taxes. Regular filings and compliance with tax obligations are essential to avoid penalties.
- Employment Regulations: Turkey has a structured labor law framework, requiring companies to provide fair working conditions, benefits, and employment contracts for all employees.
- Work Permits for Foreign Employees: Foreign-owned companies looking to employ non-Turkish staff must obtain work permits for these employees. A Turkish immigration lawyer can assist with the work permit application process.
Legal Assistance for Company Formation
Mona Law provides comprehensive legal support for company formation in Turkey, from document preparation and translation to registration and compliance. Our team ensures that your company setup process is smooth, efficient, and compliant with Turkish regulations.