1) What are the requirements for setting up a Joint Stock Company in Turkey?
- Shareholders do not need to be in Turkey for incorporation; confirmation can be handled remotely.
- Can be established with 1 to 500 shareholders.
- Minimum capital is 50,000 TL; at least 25% must be paid before registration, remainder within 24 months.
- For work permits, minimum capital is 100,000 TL.
- Capital may be in cash or real estate.
- Transfer of shares does not require notary approval and is not required to be registered in trade registry (easy transferability).
- Corporate tax rate is 22%; share sale gains after 2 years are exempt from income tax.
- If capital exceeds 250,000 TL, a lawyer must be assigned.
- Articles of incorporation must be notarized within 15 days and published in the Trade Registry Gazette.
- A valid rent agreement (including virtual address) is mandatory.
- Power of Attorney (POA) is required for financial advisor or lawyer.
- Shareholders may be on their own company payroll if not in board of directors.
2) What are the requirements for setting up a Limited Liability Company (LLC) in Turkey?
- Minimum capital is 50,000 TL.
- LLC can have 1 to 50 shareholders.
- 25% of capital must be paid before registration; the rest within 24 months.
- Power of Attorney (POA) required for financial advisor or registered lawyer.
- Rent agreement for official address (virtual or physical).
- Income tax applies to share transfers; notary approval required.
- General Manager may be external, but one shareholder must also be a manager.
- Registration must be published in Trade Registry Gazette.
- Articles must be notarized within 15 days of signature.
- Amendments require approval by shareholders representing 2/3 of the capital.
3) What taxes do we pay after establishing a LLC or Joint Stock Company in Turkey?
- Monthly VAT
- Monthly insurance liabilities (SSI) for employees
- Employer insurance premium payments
- Monthly or quarterly Withholding (Payroll) Tax
- Quarterly Corporate Income Tax
- Annual Corporate Income Tax return
- Annual legal book approval fees
- Membership fees to chambers
- Stamp Tax for any signed agreement
4) What are the obligations of profit distribution made in Turkey?
- Corporate shareholders pay 0% income tax; natural shareholders pay 15% withholding tax after CIT.
- Profit distribution not allowed if company reports a loss unless covered by prior profits.
- Joint stock companies must call a General Assembly within 3 months of year-end for distribution.
- LLC with under 20 shareholders requires shareholder resolution; over 20 needs general assembly decision.
- 5% legal reserve is obligatory each year from net profit.
5) Address requirements – Virtual Office & Workplace Options
- Tax office conducts official inspection after registration.
- You may use your home office as company address (20% withholding applies if owned personally).
- Virtual office providers accepted; no withholding on fees via company providers.
- Rented office may be furnished or unfurnished; must align with declared operations.
6) What information and documents should you have after setting up your company in Turkey?
- Apostilled passport and Power of Attorney copies
- Establishment certificate from tax office
- Rent agreement and stamp duty receipt
- Online Tax Office credentials
- Tax Certificate
- Documents for chamber registration
- Social Security number
- Bank account credentials
- Approved circular of signature
- Articles of incorporation
- Residence documents for foreign shareholders
7) What should we pay attention to when preparing the Articles of Incorporation in Turkey?
- Clearly define company name and shareholders with share amounts.
- State registered address and company directors.
- Specify operation area and financial year.
- Define capital structure and payment schedule.
- Include rules for general assembly meetings and voting rights.
- Add extra clauses if consistent with Commercial Law.
8) How can shareholders get salary from the company in Turkey?
- Board members may receive salary, bonus, or profit share under company decisions.
- Attendance fee payments are subject to income tax and SSI.
- Salaries must reflect fair market levels to avoid tax penalties.
- General Manager salary can be on company payroll.
- Any undocumented cash withdrawals are treated as profit distribution and taxed.
