DO FOREIGNERS CAN ESTABLISH A COMPANY IN TURKEY? WHAT ARE THE MOST COMMON AND SUITABLE COMPANY TYPES IN TURKEY FOR FOREIGNERS?
ESTABLISHING COMPANY IN TURKEY AS FOREIGNER
A. Documents Required for Establishing a Joint Stock Company for Foreigners
1. Petition (signed by the board of directors or by the members of board of directors who have representative authority. If it is signed by proxy the original or notarised copy of the power of attorney must be attached. The relevant Tax Office must be indicated. ),
2. 3 copıes of Establishment Declaration Form (Kuruluş Bildirim Formu) (lf there is a foreign shareholder, 4 copies are required),
3. For foreign individuals, translated and certified copy of the passport, tax identification numbers obtained from tax offices or the foreigner identification number, For foreign individuals residing in Turkey, notarised copy of the residence permit must be submitted.
4. 4 copies of notarised articles of incorporation,
5. Signature declarations of the authorized persons under the company name,
6. Founders’ declaration ( must be signed by the founders),
7. Bank receipt indicating the minimum amount of the share capital ( according to Turkish Commercial Code or articles of association are paid (At least 25% of the nominal value of the shares subscribed in cash shall be paid before official registration, whereas the balance shall be paid within twenty-four months following the registration of the company.),
8. Original bank receipt (receipt from Halk Bankası indicating that the 4/10,000 of the capital is deposited to Turkish Competition Authority.
9. Chamber Registration Statement (must bear the photos of natural persons and be signed by authorised persons).
B. Documents Required for Establishing a Limited Company for Foreigners
1. Petition (signed by all the managers of the company. If it is signed by proxy the original or notarized copy of the power of attorney must be attached. The relevant Tax Office must be indicated.),
2. 3 copies of Establishment Declaration Form (Kuruluş Bildirim Formu) (If there is foreign share holder, 4 copies are required),
3. 4 copies of notarized articles of incorporation,
4. Signature declarations of the authorized persons under the company name,
5. Founders’ declaration (must be signed by founders),
6. Bank receipt indicating the minimum amount of the share capital according Turkish Commercial Code Of articles of association is paid (At least 25% of the nominal value of the shares subscribed in cash shall be paid before official registration, whereas the balance shall be paid within twenty four months following the registration of the company.),
7. Original bank receipt (receipt from Halk Bankası indicating that the 4/10,000 of the capital is deposited to Turkish Competition Authority.
THE MAIN BENEFITS OF ESTABLISHING/FORMATING/INCORPORATING LIMITED LIABILITY COMPANY AS A FOREIGNER
– Full foreign ownership structure is permitted
– Simple registration process
– Fast establishment process
– Low share capital requirements
– Multiple functions/uses
Steps for Company Formation in Turkey for Foreigners
The most advised company type for foreigners is LLC. LLC Company Formation in Turkey can be made with a single partner. To establish a LLC type of Company in Turkey you do not need to come to Turkey physically at the establishment phase. Since the process can be completed by PoA (Power of Attorney) provided by you. Also, the below documents are required for LL Company Formation in Turkey ;
ALL THE ABOVE DOCUMENTS ARE REQUIRED TO BE APPROVED BY TURKISH CONSULATE OR APPOSTILED
1. Power of Attorney for Company Formation to our lawyer, 2 original pcs
2. Fill the form of address declaration and sign it (for partners/founders 1 person is sufficient)
3. Passport photo of the partners/ shareholders4 pcs (1 person is sufficient)
4. Passport copy 4 pcs, officially translated to Turkish (the translator at the consulates can do this)
FAQ
1- Can a foreigner investor incorporate a company without partnering with any Turkish (local) person in Turkey?
Any natural or legal foreign person may incorporate a company in Turkey without a need of having any Turkish (local) shareholder or director. Turkish Commercial Code Nr. 6102 which has been introduced back in 2011 allows company formation in Turkey with at least one shareholder. Such shareholder(s) can be foreign natural or legal person.
2- What type of companies can foreigner investors incorporate in Turkey?
Foreigner investors can incorporate either a Limited Liability Company or Joint Stock Company.
In short;
Limited Liability Company:
A Turkish Limited Liability Company can be incorporated with minimum one shareholder (natural or legal person) and the shareholders are only responsiblefrom public debts and tax claims with their personal assets. Apart from that, their liability is limited to their share ratio of the capital of the company and no private party can bring an enforcement action against personal assets of Shareholders. Please note that a minimum capital of 10,000 TL is required to establish a Limited Liability Company in Turkey. 1/4th of the minimum capital of 10,000 TL (2.500TL) should be paid before the registration while the remaining 3/4th should be paid within 2 years.
Joint Stock Company:
A Turkish Joint Stock Company can be incorporated with minimum one shareholder (real or natural person) and the c shareholders are not responsible from public debts and tax claims with their personal assets as it happens in limited liability company. Their responsibility is only limited to their share ratio of the capital of the company and no private party can bring an enforcement action for the personal assets of Shareholders. Please note that a minimum capital of 50,000 TL is needed to establish a Joint Stock Company in Turkey. 1/4 of the minimum capital of 50,000 TL (12.500TL) should be paid before the registration while the remaining 3/4 should be paid within 2 years.
3- Who can be the director(s) of a company? Are there any requirements in respect to citizenship? Can a (foreigner) company be a director?
Any natural (real) Turkish or foreign person can be a director of a Turkish company. Legal person(s) including foreign companies can also be directors of Turkish companies provided that the ‘director company’ appoint a real person as its representative. This representative can be foreign citizen as well. Therefore, there is no restriction in relation to the citizenship of the director.
4- What documents should be provided in order to start a business in Turkey?
As a leader firm, we can get your Power of Attorney (PoA) in order to be able to register a Turkish company without a need of yourself to be present in Turkey. The PoA must be notarized and legalized in the home country. This PoA can also be certified at the Turkish Consulate in your home country. If the shareholder will be yourself as real person, we will be able to incorporate a company with a valid passport and Power of Attorney only. If the shareholder will be a legal person, we will require some further documents such as registration certificate, certificate of good standing and a Board Decision appointing a signatory in Turkey.
The documents that needs to be submit before the relevant Trade Registry where the company will be incorporated are:
• Petition
• 4 copies of Establishment Declaration Form
• 4 copies of notarized articles of incorporation prepared in MERSIS.
• Signature declarations of the authorized persons under the company name before Notary.
• Founders’ declaration (must be signed by the founders),
• Bank receipt indicating the minimum amount of the share capital according Turkish Commercial Code is paid
• Original bank receipt (receipt from Halk Bankası indicating that the 4/10,000 of the capital is deposited to Turkish Competition Authority)
5- How long will company formation in Turkey take?
Company formation in Turkey can be completed within 4-5 days after the required documents are ready.
6- Should an accountant, lawyer or other advisor be consulted during the process of company formation in Turkey?
It is not compulsory, but it is definitely advisable to consult a lawyer as there are many technical issues arising during the company formation in Turkey. It is important to have competent Articles of Association, correct Signatory Declaration, authorisation in the Banks etc. Accountants must be hired after the completion of company formation in Turkey.
7- Do annual accounts have to be filed with Tax Office?
According to the Turkish regulations, yes.
8- What is the current corporate tax liability of Limited Liability Company and Joint Stock Company?
Currently the corporate tax is 22% in Turkey.
9- Are there incentives for the Turkish companies incorporated by foreign investors?
Yes, there are many incentives schemes provided to Turkish companies in different areas of activity and in different regions of Turkey.
10- What type of residence permit will I get after incorporating a company?
Turkey residence permit and work permit are regulated through different regimes. If a foreigner wants, s/he can just get residence permit in Turkey without incorporating a company. It will be valid for 1 year and can be renewed every year. However, in order to get a work permit, the company must satisfy several conditions. If you will be the only shareholder as natural (real) person, you have to get a work permit. However, there are some conditions that your company must satisfy.
11. 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.
12. 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.
13. 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.
14. 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.
15. 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.
16. 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.
17. 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.
18. 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.
19. What are the taxes for companies in Turkey?
The corporate tax in Turkey is 22% but lower rates can apply. A payroll tax, real property tax, social security tax and other taxes also apply.
20. 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 god infrastructure are good reasons why investors should choose to open a company in Turkey.
21. How much does it cost to open a company in Turkey?
Opening a company in Turkey is not expensive, however, the business owner must consider the company registration fees, the notary fees and the honorary of the Turkish law firm handling the procedure (if one is appointed).
22. How long does it take to set up a business in Turkey?
It takes about 3 weeks to set up a company in Turkey. The procedure takes longer in the case of a branch office. If you need further information on the procedures applied by the Turkish authorities at the incorporation of a company, please contact our team of lawyers in Turkey. We can help with personalized company registration services in Turkey.
23. Is company formation is possible without turkish shareholder?
Yes, it is not necessary to have a Turkish shareholder for company formation in Turkey
24. How many shareholders do I need for Company Formation in Turkey?
You can establish a LLC (Limited Liability Company) or Joint Stock Company by a single partner.
25. Can a Legal Entity be a shareholder for the Company in Turkey ?
Yes a legal entity can be a shareholder for Company Registration in Turkey procedures.
26. Do I need to come to Turkey to complete the company establishment process?
No, we can complete the process on your behalf through the power of attorney provided by you. However, after the company formation in Turkey, the presence of an authorized signatory is necessary for some procedures.
27. Do I need to rent an office for company formation in Turkey?
Yes, however, you can establish a company in a virtual office which is very cheap to rent.
28. How much should I pay for the virtual office?
Our virtual office provider’s offer is the most economic one in the market. It is approx 40 USD/Month
29. Do I need to have a work permit or resident permit for company formation in Turkey?
No, you do not need any kind of permit for company formation in Turkey.
30. Can I automatically get a residence permit when I open a company in Turkey?
No establish a company in Turkey and residence permit are completely separate process.
31. Do I need an accountant when I open a company in Turkey?
Yes, after you establish a company in Turkey, you need to have a certified accountant.
Establish a Company in Turkey
The requirement of an office for your Company.
To establish a company a legal address is required. However, virtual office or home office is acceptable by Turkish law. The average monthly fee for virtual office is lower than the other countries. We do not have a virtual office service, however we do let you connect our partner virtual office provider without any markup. Our partner virtual office provider is one of the most economical in the market.
The requirement of a resident permit after company formation in Turkey
If you are going to live in Turkey, you also require to have a resident permit. This is a separate process. Company formation does not automatically grant you resident permit, however having a company will make your resident permit process easier. We also give you a service for a resident permit, please consult is with this regard.
The requirement of a work permit after company formation in Turkey
If you are the single shareholder and director of the company, you do not need work permit. However, if you are going to employ a foreigner, you require a work permit.
The minimum required capital for Company Formation in Turkey
The minimum capital required is 10.000-TL for LLC. However, you do not need to make this payment at the beginning. You can make this payment within 2 years.
Bank Account Opening in Turkey for Foreigners
The main purpose of the many entrepreneurs for Company Registration in Turkey is the bank account opening. However, for personal bank account opening company registration in Turkey is not necessary. In Turkey, both commercial and personal bank account opening is very easy. In this section, we will give information about both types of bank accounts.
Commercial Bank Account Opening in Turkey
For this type of bank accounts, company registration in Turkey is required. Commercial bank account opening in Turkey can be done by an authorized company director. Firstly, the tax number should be obtained for the company. The registered company in Turkey does not need to be operational.
Besides, the company in Turkey does not need an office. In order to open a commercial bank account in Turkey, the address is sufficient. The company director should apply the bank with the required documents. Such documents should show the authority of the company director. Besides, the documents should be notarized. The notarization can be done by a public notary in Turkey or Turkish Consulates.
Personal Bank Account Opening in Turkey
Firstly, the applicant should define a notification address. Some banks require resident permit, some banks do not. This requirement depends on the internal policies of the banks. Secondly, the applicant should obtain potential tax number. Finally, with the passport, address and the tax number the applicant can open a bank account.
Above mentioned procedures may vary depends on the banks. In order to get consulting company registration in Turkey and Bank account opening please contact us.
