Establishing a Company in Turkey
If you collaborate with someone familiar with the proper procedures and required paperwork, setting up a company in Turkey can be finished in an hour.
The company formation in Turkey is duty-free. Moreover, foreign real and legal entities are subject to the same regulations as domestic investors when establishing a business in Turkey. So, all investors are entitled to the same rights and liabilities.
How to Open a Company in Turkey?
You should start by choosing the company type and finding commercial real estate in Turkey that will best suit your business investment objectives. Additionally, you must reach the minimum sales amount of 400,000 USD if you also want to obtain citizenship in Turkey through commercial investment.
Any type of company described in the Turkish Commercial Code (TCC) may be founded by foreign investors. Under the TCC, there are corporate and non-corporate forms of companies, which can be founded into the following types of businesses:
- Corporate forms
• Joint stock companies (JSC)
• Limited companies (LLC) - Non-corporate forms
• Collective companies
• Limited partnership
• Cooperative
Some financial thresholds, such as minimum capital and organs, differ from one another, but the steps of opening a company as a JSC or an LLC are similar. In Türkiye and the global economy, JSC and LLC are the most often used business structures.
A multi-step set of rules and regulations awaits you after choosing real estate, depending on the legal entity and real person. First, in accordance with the Trade Registry Regulation, trade registry transactions must be made through the central registry system. You proceed with the execution and notarization of the company documents, which are as follows:
- Articles of incorporation signed by all the founders before Trade Registry Directorate authorized personnel or a Notary Public (four copies, one original).
For a real person:
- Two translated and notarized copies of a passport (for each real person shareholder)
- Notarized residence permit (if living in Turkey)
- Tax number
For a legal entity:
- The Certificate of Activity of the legal entity designated as the shareholder by the relevant authority in the country of the investor.
- Resolution(s) of the shareholders of the competent corporate organ of legal entity shareholder(s) authorizing the establishment.
- For the sake of clarity, the name of the real person who will act in the name of the legal entity and the appointment of the legal entity’s board member must be stated within the same or with a sepa
rate resolution in the event that a legal entity is going to be appointed as a member of the board of directors of the prospective company to be incorporated. - A notarized copy of a power of attorney (if there is a proxy)
- Notarized signature declarations (two copies)
- Notarized identity cards of the company managers (one copy)
* Note that all relevant documents, with the exception of the first item above, that will be issued and executed outside of Turkey must be notarized and apostilled or alternatively ratified by the Turkish
Consulate located in the country of transaction. The original executed, notarized, and apostilled documents must be officially translated and notarized by a Turkish notary.
After collecting the documents, the company must get potential tax identity numbers from the relevant tax authority for non-Turkish shareholders and board members. Opening a bank account to deposit the company’s capital is essential.
The following steps are depositing a percentage of the capital to the Competition Authority account, depositing at least 25 percent of the startup capital in a bank, and obtaining proof thereof.
Then, the founders apply for company registration in Turkey after gathering the required documents. The Trade Registry Office issues an announcement in the Trade Registry Gazette within about 10 days of the company registration if the documents are complete.
Plus, the company must receive a social security number from the relevant Social Security Institution. A separate employee application is required upon the company’s registration with the Social Security Institution.
During the establishment procedure, the legal books, such as journals, ledgers, inventory books, etc., will be certified by the Trade Registry Directorate’s authorized personnel.
The Social Security Institution and the tax office are notified of the company’s incorporation by the Trade Registry Directorate. A determination report is prepared by a tax officer at the corporate headquarters. The determination report must contain at least one authorized signature.
The Trade Registry Directorate forwards the company establishment form to the tax office, which contains the tax number notice.
On the day the company is registered at the registry directorate, the signatories of the company issue a signature circular before authorized Trade Registry Directorate personnel. As the last step, certain documents are moved to electronic format.
While some costs of establishing a company in Turkey are fixed, others will change based on the business you select, its volume, the number of partners, etc. Following your decision, it will be easier to determine a price with the help of a professional and act on it.
Generally, this is how the process works. Working with a professional to follow the guidelines would be wise because these procedures are subject to change at any time.
What are the Advantages of Starting Your Business in Turkey?
At the intersection of Europe, Asia, and Africa, Türkiye offers business-friendly regulations, a huge talent pool, and access to global markets to attract sustainable foreign direct investments (FDI).
She has been listed among the top 15 economies that have been developing rapidly for the last 10 years. Between 2003 and 2021, the Turkish economy grew by an average of 5.4 percent thanks to excellent macroeconomic policies and continuous reforms. During the same time period, Turkey evolved as a regional design, manufacturing, logistics, and management center, attracting nearly USD 240 billion in FDI.
To achieve this goal, a legal framework that encourages investment is essential. Due to recent reforms, particularly in the tax and judicial systems, Turkey’s legal climate has improved in a way that is welcoming to investors.
In terms of taxation, foreign and Turkish businesses are only taxed on the profits they make from the businesses they run in Turkey. Turkish law exempts foreign-based businesses from paying taxes on their profits. This policy is applicable whether the business is operated as a permanent establishment, a branch establishment, or a subsidiary.
Türkiye has sizable domestic and regional markets, with FTAs providing access to 1.3 billion consumers. More than 24 urban areas, each with a population of more than 1 million, contribute to the prosperous domestic market in Türkiye by producing goods and services.
The skilled and competitive labor force in Türkiye is one of the key factors for commercial investors as well. The young population is a significant factor in the growth of the workforce and has elevated the nation’s standing among peer nations. Among the Eu countries, Turkey has seen the highest growth in the labor force.
Lucrative sectoral opportunities, strategic location, and generous supports for the R&D ecosystem are also some of the advantages of opening a business in Türkiye.
Start Your Business in Just One Day with Tekce Visa
Tekce Visa helps you create your business in a day and without any issues, thanks to our knowledgeable experts and legal team of attorneys. We offer you complete consultation throughout the procedure and respond to any queries you may have, including collecting your documents.
If you want to learn more about the legal procedures and cost of company formation in Turkey, you may get in touch with our professionals.
