Company Formation in Turkey

Turkey sits at a genuine crossroads: a domestic market of over 85 million people, a customs union with the European Union, and direct access to Europe, the Middle East, and Central Asia. For foreign investors and entrepreneurs, setting up a company here is straightforward in principle and unforgiving in practice. The registration itself can be completed in days. The decisions that determine whether the company runs smoothly for the next ten years are made before that registration happens.

At Aslan Attorney, company formation is one of our core practices. This guide covers the legal framework, the entity types available, the current capital requirements following the 2024 reforms, the registration process, costs, and ongoing compliance obligations every foreign-owned company in Turkey needs to understand.

Legal Notice: This page provides general legal information for educational purposes only. It does not constitute legal advice. For guidance specific to your situation, please consult a qualified attorney.

The Legal Framework

Company formation and corporate governance in Turkey are governed by Turkish Commercial Code No. 6102 (Türk Ticaret Kanunu), which came into force in 2012 and was significantly amended in 2024.

Foreign investment is protected under Foreign Direct Investment Law No. 4875, which guarantees foreign investors the same rights and obligations as Turkish nationals. There is no general residency requirement, no minimum local ownership requirement, and no requirement for a Turkish partner in the vast majority of sectors.

Company registration is processed through MERSIS (Central Registration System), operated by the Ministry of Trade, and finalised at the relevant Trade Registry Office (Ticaret Sicil Müdürlüğü). Tax registration is handled by the Revenue Administration (GİB), and employer registration by the Social Security Institution (SGK).

Why Foreign Investors Choose Turkey

Equal treatment under the law: Under Law No. 4875, foreign shareholders, directors, and investors have the same rights as Turkish nationals. A company can be 100% foreign-owned in almost all sectors.

No residency requirement: Foreign individuals and entities can establish and own Turkish companies without living in Turkey. A locally appointed representative or power of attorney handles what cannot be done remotely.

Customs union with the EU: Goods manufactured in Turkey move into the EU market under preferential terms, making Turkey a genuine manufacturing and distribution base for European-facing businesses.

Competitive corporate tax: The standard corporate income tax rate under Corporate Tax Law No. 5520 is 25% as of 2026, with reduced rates and exemptions available for specific activities including exports, R&D, and investments in less-developed regions.

Free repatriation of profits: There are no restrictions on converting Turkish Lira profits to foreign currency and transferring them abroad, subject to standard tax withholding on dividends.

Investment incentives: The Turkish government, through Invest in Turkey, offers tax reductions, social security premium support, customs duty exemptions, and land allocation for qualifying investments depending on sector, region, and scale.

The Seven Entity Structures

Choosing the right structure is the single most consequential decision in the formation process. It determines liability exposure, governance requirements, minimum capital, tax treatment, and how easily the structure can scale or be restructured later.

Joint Stock Company (Anonim Şirket, A.Ş.)

The standard structure for larger operations, regulated sectors, companies planning to raise capital from multiple investors, or businesses that anticipate significant growth. Shareholders’ liability is limited to their capital contribution. Governed by a board of directors. As of 1 January 2024, the minimum capital is TRY 250,000 or TRY 500,000 for non-public companies adopting the registered capital system.

Full guide: Joint Stock Company Formation

Limited Liability Company (Limited Şirketi, Ltd. Şti.)

The most common structure for small and medium-sized foreign-owned businesses. Simpler governance, lower capital requirement, and suitable for single-shareholder ownership. As of 1 January 2024, the minimum capital is TRY 50,000.

Full guide: Limited Company Formation

Branch Office (Şube)

Allows a foreign company to operate in Turkey as an extension of the parent company, without forming a separate legal entity. The branch can generate revenue and conduct full commercial activity, but the parent company remains fully liable for the branch’s obligations.

Full guide: Branch Office Formation

Liaison Office (İrtibat Bürosu)

A non-commercial presence used for market research, representation, and coordination with the parent company’s Turkish operations or suppliers. Liaison offices cannot generate revenue in Turkey and operate under permits issued by the Ministry of Industry and Technology, renewable periodically.

Full guide: Liaison Office Formation

Free Zone Company

A company established within one of Turkey’s Free Trade Zones, offering exemptions from corporate income tax on qualifying export-oriented activities, customs duty exemptions, and VAT exemptions on goods entering or leaving the zone. Best suited for manufacturing, logistics, and export-focused businesses.

Full guide: Free Zone Company Formation

Corporate Bank Account

Not a legal structure in itself, but an essential and often underestimated step in the formation process. Opening a corporate bank account for a foreign-owned company involves bank-level due diligence on shareholders, beneficial owners, and the source of capital, and is frequently the longest single step in getting a new company operational.

Full guide: Opening a Corporate Bank Account in Turkey

Company Liquidation

When a Turkish company reaches the end of its useful life, whether due to a change in strategy, a group restructuring, or simply winding down operations, formal liquidation under Turkish Commercial Code No. 6102 is required to close the entity cleanly, settle outstanding tax and social security obligations, and deregister from the Trade Registry.

Full guide: Company Liquidation in Turkey

Comparison at a Glance

Structure	Minimum capital	Liability	Best for
Joint Stock Company (A.Ş.)	TRY 250,000 (TRY 500,000 if registered capital system)	Limited to capital	Larger operations, multiple investors, regulated sectors
Limited Company (Ltd. Şti.)	TRY 50,000	Limited to capital	SMEs, single-shareholder ownership, straightforward operations
Branch Office	None (parent company capitalisation applies)	Parent company fully liable	Extending an existing foreign company’s operations
Liaison Office	None	N/A (no commercial activity)	Market research and representation only
Free Zone Company	Same as A.Ş. or Ltd. Şti. depending on structure chosen	Same as underlying structure	Export-oriented manufacturing and logistics

Minimum Capital Requirements: The 2024 Reform

This is an area where outdated information online causes real confusion, so it deserves a dedicated explanation.

Under Articles 332 and 580 of Turkish Commercial Code No. 6102, Presidential Decree No. 7887 (Official Gazette No. 32380, 25 November 2023) raised the minimum capital requirements effective 1 January 2024.

Joint Stock Companies (A.Ş.): minimum capital increased from TRY 50,000 to TRY 250,000. For non-public joint stock companies that have adopted the registered capital system (kayıtlı sermaye sistemi), the minimum initial capital increased from TRY 100,000 to TRY 500,000.

Limited Companies (Ltd. Şti.): minimum capital increased from TRY 10,000 to TRY 50,000.

Existing companies: Provisional Article 15, added to the Turkish Commercial Code by Law No. 7511 (29 May 2024), requires all existing joint stock and limited liability companies whose capital is below the new minimums to increase their capital to the new thresholds by 31 December 2026. Companies that do not comply by this date are deemed dissolved by operation of law.

Practical implication: If you are forming a new company, the new thresholds apply from day one. If you already own a Turkish company incorporated before 2024 with capital below TRY 250,000 (A.Ş.) or TRY 50,000 (Ltd. Şti.), a capital increase resolution must be passed before the end of 2026. We advise clients on this as part of our ongoing corporate compliance work.

The Mandatory Lawyer Requirement for Larger A.Ş. Companies

This is a detail that surprises many foreign investors setting up larger joint stock companies, and it is one we flag at the structuring stage rather than after incorporation.

Under Article 35 of Avukatlık Kanunu No. 1136 (the Turkish Attorneys Act), any joint stock company whose paid-in capital is five times or more the statutory minimum capital requirement under the Turkish Commercial Code is required to retain a contracted lawyer (sözleşmeli avukat).

Following the 2024 increase of the A.Ş. minimum capital to TRY 250,000, this threshold is now TRY 1,250,000. A.Ş. companies capitalised at or above this amount must have a retained lawyer on contract, separate from any external legal counsel engaged on a matter-by-matter basis. This is a statutory requirement, not a best practice recommendation, and non-compliance carries administrative consequences.

We structure this requirement into the formation plan for clients whose capital will meet or exceed this threshold, including as an ongoing retained counsel arrangement where appropriate.

The Registration Process: Step by Step

Step 1: Reserve the Company Name and Prepare Articles of Association

The company name is checked for availability through MERSIS, the Ministry of Trade’s central registration system. The articles of association (esas sözleşme, şirket sözleşmesi) are drafted, defining share capital, shareholder structure, management authority, and the scope of business activities. For foreign shareholders, this stage also involves obtaining Turkish Tax Identification Numbers, which are required before any registration step can proceed.

Step 2: Notarisation and MERSIS Submission

The articles of association, signature declarations of authorised representatives, and supporting documents are submitted through MERSIS. Foreign individual shareholders need notarised and apostilled or consularised copies of their passports with certified Turkish translations. Foreign corporate shareholders need a certificate of activity or equivalent from their home jurisdiction, apostilled and translated.

Step 3: Capital Deposit

A portion of the declared share capital, traditionally 25% for certain structures though current practice and bank requirements vary, is deposited into a blocked bank account opened in the company’s name prior to registration. The deposit receipt forms part of the registration file.

Step 4: Trade Registry Registration

The complete file is submitted to the relevant Trade Registry Office (Ticaret Sicil Müdürlüğü). Upon approval, the company is registered, assigned a trade registry number, and the incorporation is announced in the Trade Registry Gazette (Ticaret Sicil Gazetesi). This is the moment the company gains legal personality.

Step 5: Tax Office Registration

The company is registered with the local tax office, which issues the corporate tax identification number and conducts an on-site verification visit (yoklama) to confirm the company’s physical address and operational presence.

Step 6: Social Security Employer Registration

Before hiring any employees, the company must register as an employer with SGK under Social Insurance and General Health Insurance Law No. 5510.

Step 7: Operational Corporate Bank Account

While a blocked account is opened for capital deposit before registration, a fully operational corporate account requires a separate banking relationship with full KYC, beneficial ownership, and source of funds documentation under Law No. 5549 on Prevention of Laundering Proceeds of Crime. For foreign-owned companies, this step often takes longer than the registration itself. See our dedicated guide on opening a corporate bank account.

Step 8: Sector-Specific Licensing

Depending on the business activity, additional licenses or permits may be required from the relevant regulator, for example BDDK for financial services, SPK for capital markets activities, or the Ministry of Health for healthcare and pharmaceutical operations.

Timeline

For a Limited Company or standard Joint Stock Company with complete documentation prepared in advance, registration through MERSIS and the Trade Registry typically completes within one to two weeks. The corporate bank account process for foreign-owned companies can take significantly longer, from several weeks to over a month, depending on the bank’s due diligence procedures and the complexity of the ownership structure.

Costs of Company Formation

Cost item	Notes
Share capital	TRY 50,000 minimum (Ltd. Şti.) or TRY 250,000 minimum (A.Ş.), deposited before registration
Notary fees	For articles of association, signature declarations, and powers of attorney
Trade Registry fees	Registration and Trade Registry Gazette publication
Translation and apostille	For foreign shareholder documentation
Tax office registration	Nominal administrative cost
Legal and advisory fees	Varies by structure and complexity
Registered office / virtual office	Required for the official company address
Ongoing accounting	Monthly bookkeeping and tax filing, required from day one

Corporate Taxation Overview

The standard corporate income tax rate under Corporate Tax Law No. 5520 is 25% as of 2026. Reduced rates apply to certain activities, including a reduced rate for exporters and manufacturers under specific conditions.

Dividends distributed to foreign shareholders are subject to withholding tax under Income Tax Law No. 193, with the rate potentially reduced under an applicable double taxation treaty. Turkey’s treaty network covers over 80 countries, published by the Ministry of Treasury and Finance.

VAT registration is required for companies engaged in taxable supplies under VAT Law No. 3065, with the standard rate at 20%.

Ongoing Compliance Obligations

Incorporation is the beginning, not the end, of the legal relationship between a foreign-owned company and Turkish regulators. Ongoing obligations include:

• Statutory bookkeeping in accordance with Turkish Financial Reporting Standards, maintained from the company’s first transaction.
• Monthly and annual tax filings with GİB, including VAT returns, withholding tax declarations, and the annual corporate income tax return.
• Annual general assembly meetings, required under the Turkish Commercial Code, with minutes and resolutions properly documented and, where required, registered with the Trade Registry.
• Capital structure changes, share transfers, and changes to management or representation authority must be registered with the Trade Registry as they occur.
• Social security filings for any employed staff, submitted monthly to SGK.

We provide ongoing corporate compliance support for clients, ensuring these obligations are met without requiring day-to-day involvement from shareholders or directors based abroad.

Frequently Asked Questions

Can a foreigner own 100% of a Turkish company?

Yes, in almost all sectors. Under Foreign Direct Investment Law No. 4875, there is no general requirement for Turkish shareholders or a minimum local ownership percentage. A small number of regulated sectors, such as broadcasting, aviation, and maritime, have specific foreign ownership limitations.

How long does it take to set up a company in Turkey?

With complete documentation, MERSIS and Trade Registry registration for a Limited Company or standard Joint Stock Company typically takes one to two weeks. The corporate bank account process generally takes longer and should be planned for separately.

What is the minimum capital required?

As of 1 January 2024, TRY 50,000 for a Limited Company and TRY 250,000 for a Joint Stock Company, or TRY 500,000 for non-public companies adopting the registered capital system. Companies incorporated before 2024 with lower capital must increase to these thresholds by 31 December 2026.

Do I need to be in Turkey to set up a company?

No. With a properly drafted and notarised power of attorney, a legal representative can complete the registration process on your behalf. Physical presence is generally not required for incorporation itself, though it may be required by certain banks for the corporate account opening.

Which structure is right for my business?

It depends on your scale, governance needs, and plans for raising capital. A Limited Company suits most small and medium-sized foreign-owned businesses. A Joint Stock Company suits larger operations, multiple investors, or businesses planning to raise capital through share issuance. A Branch Office suits an existing foreign company extending its operations into Turkey without creating a new legal entity. We assess this as part of every initial consultation.

What happens after the company is registered?

Tax office registration, social security employer registration if hiring staff, and opening an operational corporate bank account all follow incorporation. Ongoing bookkeeping, tax filing, and annual general assembly requirements begin from the company’s first transaction.

Working With Aslan Attorney

Aslan Attorney is an Istanbul-based international law firm registered with the Istanbul Bar Association. We handle company formation from initial structuring through registration, bank account setup, and ongoing corporate compliance.

Our company formation services cover entity selection and structuring advice, drafting of articles of association and shareholder agreements, MERSIS and Trade Registry registration, tax and social security registration, corporate bank account coordination, sector-specific licensing where required, and ongoing corporate governance and compliance support, including the retained lawyer requirement for qualifying A.Ş. companies.

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