Establishing companies in Türkiye, their types and benefits for investors

If you are considering establishing a company in Türkiye, it is important to understand the types of available companies, the required procedures, and the benefits of Türkiye to investors.

In this report, we review with you how to establish companies in Türkiye in a simple way, with clarification of the types of companies and the benefits of this.

Types of companies in Türkiye

1. LLC - LIMIRED LIABILITY COMPANY)
The limited liability company is the most common type in Türkiye, and it is suitable for investors who want to establish small to medium -sized business.

The number of founders: The founder can be one or more person.
Capital: The minimum capital is 10,000 TL.
Legal responsibility: The responsibility is limited only to what the founder puts in the capital, which means that your personal money is protected in the event of losses.
Example: Opening a small restaurant or shop in Türkiye may be done through a limited liability company.

Advantages:

Limited responsibility: The founders ’commitment is limited to the amount they put in the company.
Ease of establishment: Faster and simpler establishment procedures compared to the rest of the companies.
Flexibility in management: You can manage the company yourself or appoint a manager.
Suitable for foreign investors: Not all founders are required.

2. JSC - Joint Stock Company)
The joint stock company is a type of companies that can make shares and participate in many shareholders.

The number of founders: You need at least two founders, and there is no higher limit for shareholders.
Capital: The minimum capital is 50,000 TL.
Legal responsibility: The responsibility of the shareholders is limited according to the size of their share of shares.
Example: A car manufacturer or technology company that may be a joint stock company, because it wants to collect capital by selling shares.

Advantages:

The possibility of offering shares: shares can be issued to attract investments from the public.
Limited responsibility: As in the limited liability company, shareholders bear responsibility only as their share.
Fear of major projects: ideal for large projects that need large capital or want to enter the stock market in the future.

3. Commandite Company
This company depends on two types of partners: the solid partner, who bears unlimited responsibility for the company's debts, and the testator, who bears a limited responsibility according to his share in the capital.

The number of founders: the presence of at least one solidarity partner, and one or more recommended partner.
Legal responsibility: The solidarity partner bears unlimited responsibility, while the testator bears limited responsibility according to his share.
Example: It may be useful in the event that a person wants to enter as a partner with a capital only, while the other partner bears full responsibility.

Advantages:

Divide responsibilities: The joint partners bear full responsibility, while the interim partners have a limited responsibility.
Flexibility in the organization: The roles and responsibilities between the partners can be clearly divided.

4. Sole Proprietorship
These are the simplest types of companies, as the individual person has the entire company and bears full responsibility.

The number of founders: only one person.
Capital: There is no minimum.
Legal responsibility: The founder is responsible for all debts and financial obligations of the company.
Example: If you work as an independent like a graphic designer or a lawyer, you can establish an individual company.

Advantages:

Ease of establishment: Do not need complex procedures or large capital.
Full control: You can make all decisions yourself without the need to consult partners.
Flexibility in management: more flexible in how to manage business.

Procedures to establish a company in Türkiye:

Here are the detailed steps to establish a limited liability company in Türkiye:

Step 1: Determine the type of company
First, the type of company you want to establish (LLC, JSC or others) must be determined, as well as determining the capital, and the number of partners.

Step 2: Choose the company name
A unique name must be chosen for the company and submitted to the commercial registry office to verify that it is not previously registered.
The company's name can include part of the commercial activity you will do.

Step 3: Preparing a founding contract
The company's founding contract is a legal document to be prepared with a lawyer or legal consultant office.

The contract must include the following details:
Company Name
Company address
Commercial activities
Partners information
Capital

Step 4: Open a bank account and provide capital
A bank account in the name of the company must be opened and the capital (and the minimum capital must be about 10,000 Turkish liras for limited liability companies).
The capital is deposited in the bank account and the deposit certificate is subsequently delivered to move forward in the registration process.

Step 5: Registration in the commercial registry
After preparing the establishment and opening the bank account, the company must be registered in the commercial registry.
Registration in the commercial registry is carried out through the local Chamber of Commerce in the city where the company will be established.

Step 6: Register for taxes and obtain a tax identification number
The company must be registered in the Turkish Tax Department and obtain a Vergi Numarası tax identification number.
The tax number allows you to easily complete commercial and financial transactions.

Step 7: Registration in Social Security
If the company will employ employees, it must be registered at the Social Security Corporation (SGK) to ensure health and retirement employees.

Step 8: Issuing special permits and licenses (if necessary)
If the company is working in a sector that requires special licenses (such as food, construction, education, tourism), then you must apply for the necessary permits from the competent authorities.

Step 9: Obtaining the company's stamp and documenting the documents
The company must be obtained for the company that is used in various documents and contracts.
All important papers are documented through the notary if necessary.

 The papers required to establish a company in Türkiye

- Passport or ID card: for founders or shareholders.
- The headquarters of the company's headquarters: a rental contract or a ownership bond for the headquarters.
- Tax identification number: for both partners and managers.
- Personal photos: for founders and managers.
- Legal agencies: If there are legal representatives (lawyers or consultants).
- Capital Proof: A certificate from the bank proves the deposit of the capital.

 The costs required to establish a company in Türkiye:

The costs range from the type and size of the company. These are some approximate costs:

- Commercial registry fee: ranging from approximately 300 to 1000 TL.
- Lawyers or legal consultants: may range from 1,000 to 3,000 TL.
- The minimum capital: It starts from 10,000 Turkish liras for limited liability companies.
- Banking costs: There are fees for opening the bank account, which differ between banks.
- Licensing and permits: If commercial activity requires special permits, its costs can range - according to the type of activity.
- Social Insurance: It varies according to the number of employees.

 Duration of procedures:

The process of establishing a company in Türkiye in general takes about 7 to 14 days from the beginning of preparation until obtaining all licenses and approvals. The period can vary according to the complexity of procedures or the type of commercial activity.

The advantages of Türkiye to investors:

Türkiye offers many advantages to local and international investors, making it an attractive business environment:

1. Foreign investment directly
   Full foreign ownership: Foreign investors can possess 100% of the shares of companies in Türkiye, whether it is a joint stock company or a limited liability.
   Tax advantages: There are some tax facilities for foreign investors in certain areas such as the technology industry or renewable energy.
   2. Ease of procedures
   Facilitating the establishment: the government of Türkiye is working to facilitate the process of establishing companies, which makes it more attractive to investors. For example, companies can be established quickly (in some cases within two weeks) and online procedures are completed.
   3. Taxes and financial benefits
   Relatives are relatively low: The tax system in Türkiye is not complicated, and there are some facilities for economic activities such as export or private industries.
   Incentives for foreign investors: in some sectors such as tourism, technology, and creative industries, Türkiye offers special tax incentives.
   4. Support for small and medium enterprises
   Emerging companies' financing: Turkey supports small and medium enterprises through special financing programs, in addition to the presence of some incentives such as tax exemptions in certain areas (such as special economic or industrial areas).
   5. Advanced infrastructure
   Logistics facilities: Thanks to the geographical location, Türkiye is a point of communication between Europe and Asia, which facilitates access to global markets.
   Modern infrastructure: Türkiye provides an advanced infrastructure in terms of transportation, transportation, and communications.