As we have previously detailed the process of establishing a company in Turkey in the previous explanatory article, ‘establishing a company in Turkey’ (Either Limited Liability Companies, Joint Stock Companies, Partnership Companies, Corporate Group Companies or Commercial Companies), the registration procedure does not take more than one week. Besides this, the foreign investor needs to own a specific capital before starting up of the business. For example, the Limited Liability Company requires 10 000 Turkish Lira, while the Joint Stock Company must deposit at least 50 000 Turkish Lira.
How to register a new business in Turkey?
Foreigners who wish to open new companies in Turkey are required to complete few proceedings before the start-up as follows:
- Determining the type of the company you want to open and obtaining the foundation legal documents to be formulated based on Companies Law.
- Opening company’s bank account and depositing the required capital as specified by the law.
- Designating the manager or managers of the company as set forth by law.
- Presenting the foundation legal documents and the details of shareholders and managers in the Commercial Register.
- Obtaining Tax and Value Added Tax numbers, and registering in the Social Security at Tax Office for warranty.
- Turkish lawyers can help through the process of opening a commercial project in Turkey.
Is employing individuals in Turkey facile?
If the company which is newly established in Turkey is concerned with employing foreign individuals, the Turkish law necessitates that these foreign individuals cannot be employed until they obtain a Work Permit issued by the Turkish Authorities.
There are actually two procedures to be followed for obtaining Work Permits for foreign employees. It can be either through the Ministry of Labor. And it can also be in the country where the foreign employee resides through Turkish Embassies and Consulates.
The required documents to proceed with through Turkish Embassy or Consulate :
▪ Valid Passport of the applicant
▪ Filling an application form for Worker Visa that the applicant will be given meanwhile
▪ One updated photograph in the size of Passport’s photo, one copy of Work Contract. The applicant must send the copy later.
▪ The letter of assignment confirming the appointment of the future employee.
In the case of hiring a foreign employee by the company, the Turkish business owner must present a request to the Ministry of Labor and Social Security through the internet with the following documents:
- The letter of work permit request
- Application form for foreign employees
- Balance sheet
- The recent Statement of Profit/ Loss
The request must be presented through internet during a period of ten working days maximum in the Turkish Consulate. That is after presenting employment request by the foreign employee.
Foreign employees can be employed in Turkey under the Regulation on the Employment of Foreign Nationals in the context of Foreign Direct Investment (FDI). FDI refers to the companies established in Turkey or to a branch of a foreign company. Under Law No. 4875, a company established in Turkey can employ foreign individuals as long as foreign shareholders have at least 1,691,063 Turkish Lira of the company's capital.
The residents must fill a request to the Ministry through the internet. The work permit decision is released during one month maximum.
What are the major points for foreign investors?
The major points of interest for foreign investors in Turkey lay in three main investment zones:
The free zones:
There are about 20 free zones designed specifically to increase export investments with 100% of exemption from customs duties, companies income tax for industrial projects, value added tax and income tax on company employees' salaries whose exports exceed at least 85% of merchandise produced in Turkey, with the possibility to deposit merchandise for free and unlimitedly and also transferring profit inside Turkey and abroad.
Organized industry zones:
there are about 276 zones with lower costs of natural gas, water, telecommunications, municipal taxes on construction, and solid waste, etc. And there are as well exemptions from real estate duties for five years of construction. And if the area does not benefit from municipal service, there will be no Value Added Tax on land possession.
Technology development zones:
there are about 50 zones with major exemptions till 2024. The exemptions include company tax and income tax on revenue from software development, Value Added Tax on software application sales, and research and development (RD) staff salaries (not more than 10% of staff).
At the present time, only 34 technology development zones are in operation. The remaining others are under construction. Also you should know that there is a far-reaching advanced industry in Turkey which is hair transplantation. This business is to a high extent very competitive and attractive to investors, considering the many customers who are in need of these types of cosmetic medical services.
Other privileges are granted to foreign investors under Double Taxation Treaties which exempt investors from paying the same tax in the country of residence and in Turkey. They are also exempted from customs taxes under the free trade agreements signed with the following countries: Albania, Bosnia and Herzegovina, Chile, Croatia, Egypt, Georgia, Iceland, Jordan, Lebanon, Liechtenstein, Mauritius, Macedonia, Morocco, Norway, Palestine, Serbia, South Korea, Switzerland, Syria, Tunisia.
What are the merits of dealing with Damas Real Estate Company?
▪The accountant of Damas Real Estate Company carries out all the procedures related to the foundation on the behalf of the company owner economizing time and effort which the business owner may need for other actions.
▪Damas Real Estate Company is distinguished by fast implementation of designated tasks including the extraction of all documents related to the foundation within two day only.
▪ Damas Real Estate Company provides the listed services with very competitive prices. The company foundation process costs $1500 which is considered as low to suit all clients.
▪The legal accountant of Damas Real Estate Company prepares all the accounting books which the client needs for the organization of company’s transactions.