Company Registration in Turkey

 There are plenty of reasons for being a part of Turkey’s business realm. Its strategic geographical position, ample manpower, free trading zones, and low customs tariff attract a lot of entrepreneurs with global ambition. In short, it is a perfect hotspot for trading and business. Getting started with a new venture in Turkey is not as complicated as it seems. However, you must have some information about the legalities concerning the same. Let’s unfold how to secure company registration in Turkey and start a new venture.

What makes Turkey a Top Business Destination?

• Turkey is amongst the top nations in securing foreign investments. All of its sectors, including tourism, are experiencing rapid growth.
• With the free trade zones, Turkey envisages to provide a liberal trade environment for the overseas investors. The profit earned in these zones is not taxable and fully repatriatable.
• The establishment requirement for an entity is straightforward; all you need is one shareholder, a director, and a minimum upfront capital.
• There are many trade benefits and tax exemptions available to entrepreneurs.
• Its strategic geolocation serves as a business hotspot for those seeking international business.

Business structures for company registration in Turkey

There are plenty of corporate structures to choose from when starting a new venture in Turkey. Let’s have a glance over the same.

Turkish Joint Stock Company

JSCs are the type of entity listed on the Turkish stock exchange. They appear to be the same as the public limited company. Before incorporation, the entity must have required board members and shareholders. It is ideally suited to entities with a significant business footprint and larger management.

Turkish Limited Liability Company

LLC is a common business model widely used within the corporate realm. It offers superior flexibility and ample transparency, enabling risk diversification and clear management for members. Directors' and shareholders’ responsibilities do not necessarily coincide, ensuring definite provisioning and zero conflicts.

Branch Office

A branch office is a viable business model but lacks the legal identity and resilience to address liabilities. Parent company helms BO and addresses all of its liabilities and losses. Although BOs can engage in profit-making chores, making decisions is not their work area. Corporate tax applies to such entities.

Representative Office

Although it appears the same as BOs, RO can pursue several tasks and be involved with decision-making. However, they are not independent in a legal sense. The parent company is liable for its actions, misconduct, losses, and debts. It is worth noting that RO can help its parent entity with product promotion and market research. Engaging in commercial chores is not something they can do, legally speaking.

Turkish Free Zone Company

A Turkish Free Zone Company has access to various benefits such as profit repatriation, tax exemption, tax holidays, low custom tariffs, and availability of business places.

Compliances for Company Registration in Turkey

Below is the list of compliances requiring the unwavering attention of those seeking company registration in Turkey:

Minimum capital

To set up a Joint Stock Company or Non-public alternative, a minimum capital has been capped at 50,000 and 100,000 Turkish Liras (TL), respectively. Similarly, to set up an LLC, the minimum capital requirement is TL 10,000.

Minimum Shareholders

For most business models, the minimum requirement concerning the number of shareholders is poised at 1.

Minimum Directors

Applicants seeking company registration in Turkey must appoint at least one director. There is no cap on the upper limit in this context. Those being the partner or the manager of the LLC must have apt rights to represent the company.

Residency Requirements

As such, the requirement for appointing a local representative ceases to exist for most business models except Branch offices.

Documentation Required

Below is the list of paperwork required for company registration in Turkey

• Details concerning the Board of Directors and their obligations
• Information on the directors
• Available contracts
• Document confirming the ownership over the intangible assets like company name, logo, tagline, etc.
• Respective approvals granted by the local bodies
• Articles of Association enclosing the promoters' signatures
• Valuation Reports reflecting the cash and non-cash assets
• Document reflecting authorized signatures’s competency in company incorporation.
• Signature of Declarations concerning Directors
• Receipt of payment submitted to the authority concerned.
• Information concerning the minimal capital deposited in the designated bank.

Company Registration in Turkey: A Step-by-Step Guide

The process concerning company registration in Turkey entails several steps, which require a diligent approach:

Step 1: Register with MERSIS

This is the first and foremost step in this process. It requires you to create an account on the official portal of MERSIS. The foreign applicant won’t get access to the said portal unless they have a valid tax number.

The said portal is linked to contracts created by furnishing details concerning the application. The portal shall also create the company’s tax number. Authorized signatories must sign the contracts. Some entities must approach the Trade Registry Directorate to address some crucial formalities.

Step 2: Notary Approval, if required

In some cases, the notary is assigned to validate the next phase of the incorporation. The validation process may include vetting and signing paperwork, signature verification, etc. Following this, the applicant must draft a declaration.

Step 3: Depositing of Capital

The minimum capital equivalent to 0.04% of the authorized capital must reach the designated bank account. Such an account should fall under the  ‘share competition authority’. The exact amount can routed to the respective trade registry along with other transactions. Those constituting Joint Stock Companies must submit 25% cash of the amount in the bank account. This will help expedite the incorporation process.

Step 4: Trade Registry Application

This step requires the applicant to file an application with the respective trade registry directed toward the trade registry directorate. The application shall undergo the vetting process, following which the confirmation comes alive.

Compliances for Entities Having Company Registration in Turkey

The following compliances serve as post-registration norms for entities having company registration in Turkey:

Shareholders Meeting

The registered entities are bound to conduct shareholders' meetings within three months at the final stage of the accounting year.

Extraordinary General Meeting

Like a shareholder’s meeting, conducting an extraordinary general meeting is mandatory, and thus, it must be convened as and when required.

Board of Directors Meeting

The registered entities must convene board meetings per the rules cited in the article of association, which is a company’s charter document.

Corporate Tax

The Company must perform regular tax filing with the relevant tax authorities. 20% is the minimum corporate tax in Turkey.

Annual filing

The registered entity must address underlying compliance and perform annual filing with the competent authority.

Adviso Support

Adviso is a trustworthy platform for growth-seekers and aspiring entrepreneurs seeking global success. Our strength lies in providing unmatched expertise to those looking to start a venture abroad.

No matter how complicated it is to form a business on foreign soil, we will get the job done for you! Stop wondering about market dynamics or endless compliances, as we will help you navigate the intricate realm of the corporate world.