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Company Formation in Turkey

By 13 March 2022October 31st, 2022No Comments

In this article, Gurcan Partner’s Founding Partner Att. Bedrettin Gürcan and Serhat İlhanlı will mention Company Formation in Turkey with all the details.

 

Company Formation in Turkey

Understanding Turkey

 

Turkey is a dedicated growing country located in between Europe and Asia, functions like a bridge connecting two continents. Besides its strategical geography, Turkey provides an excellent workforce for both blue-collar and white-collar employees with its over 83 million population.

Among the 83 million, 53.8% of the population provides the labor force. Turkey has received over 190 Billion USD of direct investment in the last two decades from all around the world mostly from Western European countries, The United Kingdom, The United States, Gulf Countries. The growth rate of foreign direct investment increases steadily. The most chosen sectors for foreign direct investments are finance (35%), production (24%) and energy (12%). Also note that, Turkey’s average GDP growth rate is around 6,33% in last 9 years that means Turkey has surpassed the European Union’s average GDP growth rate by 5% each year.

 

Available Types for Company Formation in Turkey

Company formation procedures for foreigners in Turkey is set as same as Turkish citizens. It means foreigners who are willing to establish a company in Turkey, will also have to follow the procedures in Turkish Commercial Code which is re-designed in 2011 according to European Union integration policies.

Under TCC (Turkish Commercial Code), companies are categorized into two which are corporate forms and non-corporate forms.

 

Corporate forms in Turkey are:
  1. Joint Stock Company,
  2. Limited Liability Company and
  3. Cooperative Company.

Whereas non-corporate forms are Collective Company and Commandite Company which are barely preferred. In today’s Turkey, Joint Stock Company and Limited Liability Company constitute the majority of established companies. Although there are 3 types under corporate forms, company formation procedures for 3 of them are almost the same except for financial and organs requirements.

 

Gurcan Partners is an international law firm, specializing in business immigration matters in Turkey.

Please contact us for our services in Turkey.

We will back to you within 24 hours.

@: [email protected]

Or Call Us

+90 850 466 42 60

Procedures for Company Formation in Turkey

As stated above, Turkey has simplified its company formation procedures as implementation of European Union integration policy. Required steps are down below;

So far we have assisted over 400 companies. Check out our experiences.

Applications are done on an online system called MERSIS which is a central information system for the commercial registry process. The process only consists of a single step which is submitting official report and association agreement on MERSIS.

  • Execute and Notarize Company Documents

Articles of incorporation signed by all founders before authorized personnel. Beside it, required documents differs in case of founders are a real person shareholder or a legal entity. All the required documents for company formation obtained outside of Turkey shall have ratification or apostille and shall be translated in Turkish by Turkish Notary.

  • Acquiring Tax Identity Number in Turkey

Tax Identity Number functions as ID number of legal entities. Also It is required for necessary actions that the company may take in future such as opening a bank account which is also a step in company formation procedure.

  • Depositing Company’s Capital to Competition Authority

According to TCC, 0.04% of the Companies Capital must be deposited via Trade Registry Office.

  • Depositing Start-up Capital

25 percent of the subscribed capital of the company must be paid before company’s registration. However, the remaining 75 percent can be paid within two years after establishment.

  • Application to Trade Registry Office

Applications are accepted via a petition by Trade Registry Office. Documents obtained previous steps should be in the petition such as; bank certificate of 25 percent of subscribed capital and payment to Competition Authority, Articles of incorporation, tax registration certificate.

  • Certification of the Legal Books by Trade Registry Office Authorized Personnel

  • Issuance of Signature Circular and Notification of Trade Registry Office to Tax Office and Social Security Institution

Gurcan Partners International Law Firm is a corporate member of Foreign Economic Relations Board  (DEIK) and German-Turkish Chamber Commerce and Industry. (AHK)

Deik MemberGerman Law Firm

 

Taxes that Companies Face in Turkey

Turkish Corporate Tax Legislations provide harmonized provisions with international standards. Income tax that legal entities are obliged to fulfill is corporate tax which is lowered in 2020 to 20% of business profit.

On the other hand, there are multiple different taxes on expenditures such as Special Consumption Tax, Stamp Duty, and Value Added Tax (VAT) which differs from 1% to 18% and is an indirect tax at the same time. There is also wealth tax such as property taxes and motor vehicle taxes.

For more details please read our article on Taxation in Turkey.

 

Does Investing in Turkey Grant You Citizenship?

The short answer is “YES” if you meet the requirement. Fulfilling any of article down below can grant you citizenship;

  • Made a minimum fixed capital investment of USD 500,000
  • Acquired a property worth a minimum of USD 250,000 
  • Created jobs for at least 50 people
  • Deposited at least USD 500,000 or equivalent foreign currency in banks operating in Turkey with the condition not to withdraw the same for at least three years
  • Bought at least USD 500,000 worth of government bonds with the condition that they cannot be sold for at least three years
  •  Bought at least USD 500,000 worth of real estate investment fund share or venture capital investment fund share with the condition that they cannot be sold for at least three years

 

Please note that every each of the spendings written above can be also done in equivalent foreign currency or in Turkish Lira.

 

For more details, please look at our article on Turkish Citizenship by Investment.

Gurcan Partners provides tailor made legal services in Turkey.

Please contact us

We will back to you within 24 hours.

@: [email protected]

Or Call Us

+90 850 466 42 60

All the process of Company Formation in Turkey, our international team is ready to help you in 13 languages. Please do not hesitate to contact us.

Check out Gurcan Journal for more articles in 13 languages. Schedule your online meeting below.
To read our other articles:
  1. Buying Property in Turkey
  2. Taxation in Turkey
  3. Commercial Dispute Resolution in Turkey
  4. Turkish Citizenship by Investment

Company Formation in Turkey

Att. Bedrettin Gürcan LLM, MA, PhDs

Serhat İlhanlı LLBs

Gurcan Partners Turkey Office

Address:

Kanyon Tower D Office Building Buyukdere Avenue. No. 185, no 34394 İstanbul/Turkey

@: [email protected]

P: +90 850 466 42 60

Gurcan Partners

References:

  1. http://v1.invest.gov.tr/tr-TR/investmentguide/Pages/10Reasons.aspx
  2. https://www.ytb.gov.tr/yurtdisi-vatandaslar/turk-vatandasligi
  3. https://www.invest.gov.tr/en/investmentguide/Pages/default.aspx
  4. https://ticaret.gov.tr/istatistikler/dis-ticaret-istatistikleri
  5. https://www.invest.gov.tr/en/investmentguide/pages/tax-guide.aspx
  6. https://www.gib.gov.tr/yardim-ve-kaynaklar/sikca-sorulan-sorular
  7. https://www.invest.gov.tr/en/investmentguide/pages/acquiring-property-and-citizenship.aspx
  8. https://www.doingbusiness.org/content/dam/doingBusiness/country/t/turkey/TUR.pdf

All rights reserved. All rights of Company Formation in Turkey article belong to Gurcan Partners. The author has no responsibilities from the information in this article. This article is prepared just to inform.

Please contact us via mail. We endeavor to respond within 24 hours.

Please contact us via mail. We endeavor to respond within 24 hours.

We will back to you within 24 hours.

@: [email protected]

Or Call Us

+90 850 466 42 60

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