From entity selection, MERSIS application and trade registry filing to post-registration tax compliance, this guide covers every step of establishing a company in Turkey. Whether you are forming an LLC, a Joint Stock Company, opening a branch, or exploring Free Trade Zone opportunities, Celikel CPA provides end-to-end professional support so your Turkish operation is legally sound and operationally ready from day one.
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Under the Foreign Direct Investment Law (No. 4875) [1], foreign nationals hold equal rights with Turkish citizens when forming companies. You may own the entirety of a Turkish LLC or JSC without any local partner requirement. Profit repatriation is unrestricted after applicable taxes are settled, and there is no residency obligation for company ownership.
Foreign investors hold the same incorporation and operational rights as Turkish nationals under FDI Law No. 4875 [1]. No sector-wide restrictions apply for standard commercial activities.
Company formation applications are processed through the MERSIS online system, the Ministry of Trade's electronic registration portal, providing a standardized and traceable process.
Available benefits include VAT exemptions, customs duty waivers, corporate tax reductions, and social security premium support depending on your investment region and sector [5].
Foreign investors can complete the entire registration process without travelling to Turkey by appointing a legal representative through a notarized and apostilled power of attorney.
Watch: Company formation process overview for foreign investors
Turkey's position as an investment destination is shaped by a combination of geographic, economic, and regulatory factors. For international entrepreneurs evaluating where to base or expand operations, the following elements are directly relevant to formation decisions.
Turkey connects three continents and serves as a logistics corridor between Europe, the Middle East, Central Asia, and North Africa. Companies headquartered here can access a massive consumer base through Turkey's network of free trade agreements and its customs union arrangement with the European Union. For businesses in trade, manufacturing, or distribution, this access directly reduces tariff burdens and shipping costs.
The Foreign Direct Investment Law (No. 4875) [1], enacted in 2003, grants foreign investors equal treatment under Turkish commercial law. A foreign national can establish, manage, and fully own a Turkish company under the same conditions as a Turkish citizen. The law permits unrestricted transfer of profits, dividends, and capital proceeds abroad.
As a G20 economy, Turkey maintains an active business environment across technology, manufacturing, agriculture, tourism, and e-commerce. Government-backed incentive programs, particularly in organized industrial zones, technoparks, and free trade zones, provide meaningful tax benefits to qualifying investors.
Turkey's population includes a large, technically trained labour pool with competitive salary expectations relative to Western European markets. The combination of a skilled workforce and lower operating costs makes Turkey attractive for both service-oriented startups and capital-intensive manufacturing operations.
At Celikel CPA, our scope extends well beyond the registration itself. We serve as your ongoing financial partner in Turkey, handling monthly accounting, tax compliance, payroll, and strategic financial advisory for the entire lifecycle of your business.
Selecting the right legal entity is one of the most consequential decisions in company formation. It determines your liability framework, tax treatment, governance requirements, and future options for raising capital or restructuring. The Turkish Commercial Code (Law No. 6102) [2] defines several entity types, each suited to different business objectives.
The LLC is the most widely used entity type among foreign investors in Turkey, particularly for small-to-medium enterprises, service companies, and foreign subsidiaries. It offers straightforward governance, lower capital requirements, and simplified shareholder administration.
The JSC is structured for larger or more complex operations, including companies that plan to attract institutional investors, issue transferable shares, or eventually pursue a public offering. The governance structure is more formal, but it provides greater flexibility for equity transactions.
| Criteria | LLC (Limited Sirket) | JSC (Anonim Sirket) |
|---|---|---|
| Minimum Capital (2026) | 50,000 TL | 250,000 TL |
| Capital Payment Timeline | Full amount payable within 24 months after registration | Minimum 25% before registration; remainder within 24 months |
| Number of Shareholders | 1 to 50 | 1 or more (no upper limit) |
| Share Transferability | Notarized agreement required; pre-emption rights apply | Freely transferable; share certificates may be issued |
| Management Structure | Manager(s), simpler governance | Board of Directors required, formal meetings necessary |
| Annual Governance | Written resolutions permitted; less formality | Mandatory annual General Assembly |
| Public Offering Eligibility | Not eligible for IPO | Eligible for public offerings and capital markets |
| Best Suited For | SMEs, startups, service firms, trading companies, foreign subsidiaries | Large enterprises, VC-backed companies, holding structures, IPO candidates |
A significant practical challenge exists for foreign investors choosing the JSC structure: Turkish law requires at least 25% of the declared capital to be deposited in a Turkish bank account before the company is legally registered. Since opening a bank account typically requires a tax identification number, and obtaining that number involves the company's formation process, foreign investors face a circular dependency. The standard resolution involves obtaining a temporary foreign tax ID and establishing a capital blocking account at participating banks.
For this reason, the LLC structure is typically recommended for most foreign entrepreneurs. With an LLC, you register your company first and have 24 months to pay the capital, meaning you can open your bank account after the company exists.
For a more thorough comparison, see our dedicated resource on LLC vs. JSC in Turkey, and our step-by-step LLC formation guide.
A branch office operates as a direct extension of the foreign parent company. It does not constitute a separate legal entity, meaning the parent company assumes full liability for the branch's operations in Turkey.
A liaison office is a non-commercial presence established strictly for market research, promotion, and coordination activities. It cannot generate revenue, issue invoices, or enter into commercial contracts.
Companies established within Turkey's designated Free Trade Zones (FTZs) benefit from a distinct fiscal framework designed to encourage export-oriented operations.
Turkey's Technology Development Zones (technoparks) offer specialized incentives for R&D and software-focused businesses under Law No. 4691.
The registration process follows a defined sequence of legal and administrative steps. While the procedures are standardized through the MERSIS system, the practical execution, particularly for foreign nationals, involves document preparation, translation, and coordination with Turkish authorities. Below is the full process as it applies in 2026.
Before any registration application can be submitted, foreign investors must prepare the following:
Duration: 2 to 5 business days (depending on apostille and translation timelines). Passport copies are notarized, power of attorney documents are drafted, and the Turkish tax identification number is obtained.
Duration: 1 to 2 business days. A MERSIS record is created and the articles of association are submitted electronically. Notarial certification of the articles and shareholder signatures is obtained. The competition authority fee (0.04% of capital) is deposited.
Duration: 1 to 3 business days. The complete application file is submitted to the relevant Trade Registry Office. Upon approval, the Trade Registry Gazette publication is issued and the company receives its official tax identification number.
Duration: 1 to 2 business days. The company's legal representative completes initial registration formalities at the designated tax office. If the company will employ personnel (including the foreign investor acting as a manager), enrollment with the Social Security Institution (SGK) is mandatory.
LLC Total: Approximately 5 to 7 business days. JSC Total: Approximately 10 to 15 business days. At this stage, your company legally exists and can begin commercial operations once the post-registration obligations below are completed.
Completing the trade registry filing marks the legal creation of your company, but several operational steps remain before the business can function day-to-day. These procedures involve technology access, banking infrastructure, and regulatory verification.
Every company in Turkey must submit tax declarations, e-invoices, and official filings electronically. The company's legal representative must obtain an e-signature certificate from an authorized provider (e-Tugra or Kamu SM). Timeline: 1 to 2 business days. For foreign investors, the application interface is in Turkish and the identity verification process requires either a Turkish ID card or a notarized passport with power of attorney.
Within 15 days of registration, a tax inspector will conduct an unannounced visit to the company's registered address to verify that the premises are genuine and occupied. The inspector checks for company signage, accessible commercial space, and availability of a company representative. If you are using a serviced office, the space must show clear evidence of business activity.
Opening a corporate bank account in Turkey is widely recognized as one of the most challenging steps for foreign investors. Turkish banks apply rigorous AML and customer due diligence procedures, and branch-level staff rarely communicate in English. Without professional support: 2 to 4 weeks average. A CPA firm with established bank relationships can coordinate directly with senior branch officers and pre-assemble required documentation to expedite the process.
Turkey operates a mandatory e-invoicing system. Registration with the Revenue Administration's e-document portal may be required immediately or upon reaching specified thresholds [3]. E-Ledger (electronic bookkeeping) follows the same framework. These systems are integrated with your accounting software and require ongoing maintenance.
Celikel CPA guiding international clients through the company formation process in Istanbul
Understanding the tax structure is essential for financial planning and compliance. Below is a summary of the primary tax obligations that apply to companies operating in Turkey as of 2026. For tailored guidance on your specific situation, our tax advisory services provide comprehensive support.
| Tax Type | Rate | Key Details |
|---|---|---|
| Corporate Income Tax | 25% | Applied on net taxable profits. A domestic minimum corporate tax applies to certain covered taxpayers at 10% of gross corporate income before deductions (effective from 2025 onward). Annual return filing is due in April, with quarterly provisional tax payments required throughout the year [3]. |
| Value Added Tax (VAT / KDV) | 20% | Standard rate on the sale of goods and services. Reduced rates of 1% and 10% apply to certain essential goods. Exports are zero-rated, and exporting companies may claim VAT refunds on input purchases. Monthly VAT declarations must be filed electronically. |
| Withholding Tax (Stopaj) | 15-20% | Applicable to dividends distributed to shareholders (15%), rent paid to individual landlords (20%), and fees paid to independent professionals (20%). Double taxation treaty provisions may reduce these rates. |
| Social Security (SGK) | ~37.5% total | Combined employer (~22.5%) and employee (~15%) contribution on gross salary. A 5-point Treasury incentive discount is available on the employer share for eligible companies. Monthly reporting to SGK is mandatory for all employees. |
| Stamp Tax (Damga Vergisi) | Variable | Applies to specific documents, most notably commercial contracts (~0.948% of contract value). Certain monthly tax returns and official declarations are subject to fixed stamp tax amounts. This tax is often overlooked during initial planning. |
Beyond meeting compliance obligations, structuring your Turkish operations with tax efficiency in mind can yield meaningful savings. The following strategies are available under Turkish law and should be evaluated at or before the time of company formation.
Turkey operates a multi-tiered system of investment incentive certificates that can significantly reduce capital expenditure costs. Qualifying investments may benefit from VAT exemptions on imported machinery, customs duty waivers, reduced corporate tax rates, employer social security premium support, and land allocation in organized industrial zones [5].
Turkey has concluded double taxation agreements with more than 80 countries. These treaties can substantially reduce withholding tax on cross-border payments including dividends, interest, royalties, and service fees. Effective use of treaty benefits requires proper documentation, including a Certificate of Tax Residency from the investor's home country.
Companies with related-party transactions across borders must structure intercompany pricing according to the arm's length principle as defined in Turkey's transfer pricing regulations (aligned with OECD guidelines). Proper documentation, including annual transfer pricing reports, is essential to avoid penalties and audit adjustments [4].
Under the reactivated inflation adjustment provisions of Tax Procedure Law Provisional Article 33, companies must restate non-monetary balance sheet items using the CPI. When applied strategically, this adjustment can reduce the effective corporate tax burden by eliminating the taxation of fictitious profits arising from inflationary distortions.
Operating in Turkey involves a relational business culture that differs from purely transactional Western norms:
The following issues arise repeatedly in our work with international clients. Each can be prevented with proper planning and professional guidance at the outset.
Selecting a JSC when an LLC is sufficient, or vice versa, leads to unnecessary costs, governance complexity, or limitations on future growth. The decision should be based on your capital needs, shareholder composition, and long-term business model.
The MERSIS interface is in Turkish, and the registration process requires precise compliance with legal formatting, NACE code selection, and notarial procedure. Errors in the articles of association or incorrect activity code selections create problems that are costly to rectify after registration.
Hiring an accountant only after the company is formed means missing critical decisions that must be made at registration, including capital structuring, VAT elections, and fiscal year planning. Engaging a CPA before formation allows you to build tax efficiency into your company's foundation.
The standard articles of association registered with the trade registry provide limited protection in partnership disputes. A private shareholders' agreement covering deadlock resolution, exit valuation formulas, drag-along/tag-along rights, and non-compete clauses is essential for any multi-partner entity.
Turkish tax law imposes strict filing deadlines: monthly VAT returns, quarterly provisional tax payments, annual corporate tax returns, SGK declarations, and withholding tax submissions. Missing any of these triggers automatic penalties and interest charges.
While the legal minimum capital for an LLC is 50,000 TL, starting with the minimum can create practical difficulties including cash flow constraints, reduced credibility with banks, and limitations on work permit eligibility.
Holding shares in a Turkish company does not grant the right to work or reside in Turkey. Foreign shareholders who plan to work within the company must apply separately for a work permit, and the company must typically meet the Turkish employee ratio requirement.
Changes in company address, management, shareholders, or capital must be formally registered with the Trade Registry. Neglecting to report changes results in fines and can create legal and banking complications that compound over time.
Celikel CPA & Accounting Firm, led by CPA Yigit Celikel, provides end-to-end company formation support for international clients. Our role extends beyond registration: we handle tax planning, ongoing accounting, payroll management, and regulatory compliance so that your Turkish operation is built on a stable financial and legal foundation from day one.
The company formation procedures, legal frameworks, and tax obligations described on this page are grounded in the following official Turkish legislation and institutional resources: