Company Formation in Turkey for Foreigners 2026 — Minimum Capital, Documents and Apostille, Setting Up by Power of Attorney, Dividend Withholding Tax, Work Permits and Post-Registration Filings

Türkçe sürüm: Yabancıların Türkiye’de Şirket Kurması

Turkish law applies national treatment to foreign investors: a foreigner setting up a company is, as a rule, treated in the same way as a Turkish founder, and the limited company and joint stock company forms are open on the same terms. There is no special “foreign company permit”, and all of the shares may belong to foreigners. Formation is completed through a tax number, apostilled and translated documents and the trade registry steps. The critical point comes afterwards: being a shareholder does not give a right to work, so a work permit must be obtained separately for any foreign shareholder or manager who will actually work in the company. This guide explains, step by step and with the 2026 figures, how a foreigner sets up a company in Turkey: the choice of structure, minimum capital and when it must be paid, the documents required, setting up without traveling to Turkey, buying into an existing company, sector restrictions, tax, work permits and the filings that follow registration.

National treatment: no special permit for foreigners

A German engineer’s software company in Istanbul, an Iraqi trader’s logistics firm in Mersin, a Russian entrepreneur’s travel agency in Antalya: the Turkish economy is intertwined with tens of thousands of companies with foreign capital, and the legal framework is remarkably open. The basis of the foreign direct investment regime is a single provision, Article 3/a of Foreign Direct Investment Law No. 4875:

Law No. 4875, Art. 3/a — “Unless otherwise provided by international agreements and special laws: 1. Foreign investors are free to make foreign direct investments in Turkey. 2. Foreign investors are subject to equal treatment with domestic investors.”

The proviso at the start of the sentence also draws the limit of this freedom. The words “unless otherwise provided by international agreements and special laws” make national treatment the general rule while reserving restrictions introduced by special laws. In practice, this is why a sector check is the first item of any formation plan: in fields such as mining, banking, media and broadcasting, civil aviation and shipping, special laws may impose shareholding and activity restrictions. Relying on the general freedom without checking sector legislation creates a problem that only surfaces after registration and may require the structure to be rebuilt from scratch.

The other guarantees of the Law are in the same article. Foreign direct investments cannot be expropriated or nationalized except where the public interest requires it and compensation is paid (Art. 3/b). Net profits, dividends, proceeds from sale, liquidation and compensation, payments under license and management agreements, and principal and interest on foreign loans can be transferred abroad freely through banks (Art. 3/c). Companies with legal personality that foreign investors set up or participate in in Turkey may freely acquire real estate or limited rights in rem in areas open to acquisition by Turkish citizens. Companies established under foreign law may be granted permission to open a liaison office, provided they do not engage in commercial activity in Turkey.

The transfer guarantee concerns the exit plan as much as the entry. Article 3/c guarantees not only the transfer of profits but also the free transfer abroad of liquidation and sale proceeds. In other words, what matters for the investor is not only “how do I bring the money in” but also “how do I take it out when I need to”, and the Law’s answer is in this subparagraph. Because transfers are made through banks, delays in opening a bank account due to banks’ compliance procedures are not merely an operational issue but part of the infrastructure on which the exit plan depends. For a broader overview of the legal framework, see our Legal Guide for Foreign Investors in Turkey.

Choosing the structure: limited company, joint stock company, branch or liaison office

A foreign investor has three main doors. The limited company is the most common choice of foreign entrepreneurs: it can be set up by a single shareholder (an individual or a company, entirely foreign), it is managed by managers and it is the flexible vehicle for small and medium-sized businesses. The joint stock company is the vehicle for a corporate structure, investment rounds and, later, flexibility in public offerings and share transfers: it can be set up with a single shareholder, and its capital deposit rules and corporate bodies require more corporate discipline; investments with growth plans often choose this door. Finally, a parent company abroad can exist in Turkey without setting up a company, through a branch (an extension of the parent that carries on commercial activity) or a liaison office.

Breaching the second row has a double consequence. A liaison office that issues invoices, makes sales or signs contracts with customers faces, under the permit regime, the risk of having its permit canceled and its activity stopped, and, under tax law, the risk of being taxed as a non-resident (limited) taxpayer, of unrecorded income and of tax penalties. A strategy of “let’s test the market with an office first and incorporate later” is legitimate; trading through the office is not. The practical test is simple: is income arising in Turkey? If so, the wrong structure has been chosen.

Between a limited company and a joint stock company, the choice becomes decisive for a foreign shareholder on two points: liability for public debts and the share transfer regime.

The first row is the risk foreign investors most often overlook. Under Article 35 of Law No. 6183, the shareholders of a limited company are directly liable, in proportion to their capital shares, for the company’s unpaid tax and social security premium debts that cannot be collected from the company; this provision does not apply to the shareholders of a joint stock company. This liability does not end because the shareholder has left Turkey or has no role in management. Moreover, under Article 35/2, the transferor and the transferee of a share are jointly and severally liable for such public receivables relating to the period before the transfer. An investor abroad who becomes a shareholder in a Turkish limited company without obtaining a certificate that there are no tax or social security debts may, years later, face debts from a period it knew nothing about. For investors who will be shareholders only, a joint stock company is therefore better protected in terms of liability risk.

The fourth row combines with work permits. Because TTK Art. 623 requires at least one manager of a limited company to be a shareholder, in a limited company whose shareholders are all foreign the manager will necessarily also be a foreigner, and that manager needs a work permit. Since a member of the board of directors of a joint stock company does not have to be a shareholder, the structure can be set up more flexibly.

Minimum capital and payment schedule (2026)

Law No. 4875 does not set a separate minimum capital for foreigners; a foreign founder is subject to the general amounts in the Turkish Commercial Code, like a Turkish founder. These amounts were increased by Presidential Decision No. 7887, published in Official Gazette No. 32380 of 25 November 2023, and have applied since 1 January 2024. The first question for the capital line of an investment plan is therefore not “how much” but “in which type of company, and when must it be paid”.

The last row concerns the old company that will be bought or joined rather than the company to be set up. Under provisional Article 15, added to the Turkish Commercial Code by Law No. 7511 published in the Official Gazette of 29 May 2024, joint stock and limited companies whose capital is below the minimum amounts are deemed dissolved by operation of law, without any further action, unless they increase their capital by 31 December 2026; the Ministry of Trade may extend this period by one year at a time, at most twice. If the issued capital of a non-public joint stock company in the authorized capital system is at least TRY 250,000, the company is not dissolved; if it does not raise its capital to TRY 500,000, it merely exits the authorized capital system. A foreign investor who takes over the shares of an old limited company that looks attractively priced may, if the capital increase is not made, become a few months later a shareholder in a company in liquidation.

The payment schedule determines the investor’s cash plan. In a joint stock company, at least one quarter of the cash capital committed is paid before registration into a special account opened at a bank in the name of the company being formed; the bank releases this amount to the company only upon being notified that the company has been registered (TTK Arts. 344, 345). In a limited company, the cash capital committed is paid within twenty-four months after registration. Failure to pay the committed capital is not merely an internal matter: unpaid capital may expose the shareholder to liability toward the company’s creditors and for public receivables, and in a limited company this risk combines with Article 35 of Law No. 6183.

Capital brought from abroad should be transferred through banks and documented. Article 2/b of Law No. 4875 includes cash capital brought from abroad in the definition of foreign direct investment, and the ability to transfer profits and liquidation proceeds freely abroad later (Art. 3/c) also relies on the inflow having been documented. The capital should therefore be sent from the shareholder’s own account to the account opened in the company’s name, with the payment description stating that it is a capital payment, and the bank receipts and foreign exchange purchase documents should be kept.

Documents for foreign founders

The trade registry office accepts a foreign document only once its validity has been proven and it has been translated into Turkish. The document set differs depending on whether the founder is an individual or a company established abroad.

How the articles of association are signed depends on the type of company. In a joint stock company, following the amendment made by Law No. 6728 (Official Gazette, 9 August 2016), the founders’ signatures may be notarized, or the articles of association may be signed before the director or deputy director of the trade registry (TTK Arts. 335, 339). In a limited company, the notary option was removed by Law No. 7099 (Official Gazette, 10 March 2018): the articles of association are signed by the founders or their attorneys-in-fact before authorized staff at the trade registry office (TTK Art. 575). A founder who does not speak Turkish must be accompanied by a sworn interpreter at signing; otherwise it may become disputable whether the signature reflects the founder’s will.

The chain of validity of a document depends on the country. A document issued in a country that is party to the Hague Apostille Convention receives an apostille from that country’s competent authority; in countries that are not party to it, the document is legalized by the Turkish consulate in that country. The document is then translated in Turkey by a sworn translator and the translation is notarized. If any link in this chain is missing, the registry application is returned, and completing documents from abroad can take weeks. The document set should therefore be prepared before coming to Turkey. For details, see our guide (in Turkish) Apostil ve Yabancı Belgelerin Tasdiki (apostille and legalization of foreign documents).

A founder enters the system through a number. Founders with a residence permit in Turkey act with their foreigner identity number; founders coming for a short time act with a potential tax number obtained from the tax office; and if the founder is a company abroad, that company must also obtain a tax number in Turkey.

Can you set up a company without coming to Turkey?

Yes. Instead of signing the articles of association personally, the founder can appoint an attorney-in-fact in Turkey under a special power of attorney. In trade registry practice, where the articles of association are signed through an attorney-in-fact, the original power of attorney is filed in the registry file. A power of attorney drawn up abroad can be issued at the Turkish consulate in that country, or it can be notarized by a foreign notary and used with an apostille and a notarized Turkish translation. The power of attorney should not be drafted in general terms such as “to set up a company”; it should be specific enough to cover the type of company, trade name, capital, shareholding ratios and the appointment of managers or board members.

The limits of remote formation should also be known. The company can acquire legal personality through an attorney-in-fact; however, when a bank account is opened, banks carry out identity verification and beneficial ownership checks as required by law, and some banks may require the authorized person to apply in person. In addition, the work permit process for any foreigner who will actually work in the company and the tax office’s inspection of the business premises require showing that the company operates at a real address. Even in a remote formation, steps that may require the investor to come to Turkey at least once should therefore be built into the timeline from the outset. For bank account processes, see our guide (in Turkish) Yabancı Uyrukluların Türkiye’de Banka Hesabı (bank accounts for foreign nationals).

The address deserves attention too. The registered address, including any virtual or serviced office, must be real enough to withstand the tax office’s inspection under Tax Procedure Law No. 213; if the inspection is negative, the tax registration and the start of business are disrupted.

Step-by-step formation timeline

The following is the logical order for an investor living abroad who is setting up a limited or joint stock company. The duration of each step depends on the country the documents come from, the bank and the workload of the trade registry office.

Step seven is the moment the legal effect arises. A joint stock company acquires legal personality upon registration with the trade registry (TTK Art. 355); the same rule applies to a limited company (TTK Art. 588). For transactions made in the company’s name before registration, the persons who made them may be held liable if the company does not take them over after registration. Commitments such as leases, staff and supply contracts should therefore be planned around the registration date. After registration, the chain is completed: signature circular, tax office inspection, social security workplace registration (before employing staff), chamber registration and the electronic notification address. For the details of setting up a limited company, see our guide (in Turkish) Limited Şirket Kuruluşu ve Esas Sözleşme.

Shareholding is not a right to work

This is the most important section of this guide: the fact that the company has been set up does not give the foreign shareholder a right to actually work in it. Holding shares is a property right; sitting at a desk, meeting customers and running operations is work, and work is subject to a permit. In particular, the shareholder who is a manager of a limited company, and every shareholder who takes on an active role in the company, must obtain a work permit. “It’s my own company, I don’t need anyone’s permission” is recorded in an inspection report as working without a permit, and both the company and the individual are penalized. The legal basis for this distinction is not Law No. 4875 but International Labour Force Law No. 6735.

The sanction in the fifth row works both ways and is not limited to a fine. Under Article 23 of Law No. 6735, an administrative fine is imposed on anyone who employs a foreigner without a permit, for each foreigner; in addition, the employer covers the accommodation and return costs, and where necessary the health costs, of the foreigner and of any spouse and children. For a shareholder working without a permit in their own company, this means the same person is liable in both capacities. Working without a permit as a manager results in administrative fines for both the company and the individual and adversely affects later permit applications. Company formation and the work permit application should therefore be planned on the same timeline. For details, see our guide (in Turkish) Yabancıların Çalışma İzni (work permits for foreigners).

The sixth row makes planning easier. Under Article 27 of Law No. 6735, a work permit also counts as a residence permit, so no separate residence application is needed for a foreigner who obtains a work permit. Conversely, if the permit is refused, the residence status must be resolved separately; see our guide (in Turkish) Çalışma İzni Başvurusunun Reddi ve İtiraz (refusal of a work permit and objections).

Under Article 7 of Law No. 6735, applications are examined in the light of the Law, the relevant regulation, international labour force policy and the evaluation criteria published by the Ministry. Having a complete file does not by itself mean that the permit will be granted.

The thresholds are published and updated periodically; they must be checked on the day of the application. Criteria such as the amount of capital, the ownership percentage and the number of employees are set out in the evaluation criteria announced by the Ministry and change over time, so plans based on old figures may be outdated. A newly set up company may not meet the employment and capital criteria in its first months; ownership ratios, the amount of capital and the initial hiring plan should therefore be designed together with the permit criteria, because changing the structure after formation is both costly and time-consuming. The logic that does not change is this: a permit strategy cannot be built on a company that exists only on paper, with no employees and no turnover. Real activity is the basis both for the permit and for long-term plans such as citizenship by investment under Article 12 of Turkish Citizenship Law No. 5901. The Turquoise Card under Article 11 of Law No. 6735 offers a separate route for qualified investors and experts and should be planned together with the company structure; see our guide (in Turkish) Turkuaz Kart ve Nitelikli Yabancılar (the Turquoise Card).

Buying into an existing Turkish company

Instead of setting up a company from scratch, a foreign investor can also buy shares in an operating Turkish company. Article 2/b of Law No. 4875 treats becoming a shareholder in an existing company other than through the stock exchange, and acquiring at least 10% of the shares or voting rights through the stock exchange, as foreign direct investment. This route offers ready licenses, customers and staff; in return, the company’s past debts and disputes are taken over together with the company.

Legal due diligence before a share transfer should cover at least four topics: the company’s tax and social security debt position, lawsuits and enforcement proceedings against the company, whether the trade registry records (capital, powers of representation, pledges and annotations) are up to date, and whether the permits and licenses tied to the company’s activity are affected by the transfer. Because in a limited company the transferee may be held liable for public debts from before the transfer, debt status letters from the tax office and the Social Security Institution should be attached to the agreement, and the seller should give an indemnity and security for undisclosed debts. For details, see our guide (in Turkish) Limited Şirket Ortağının Amme Borcundan Sorumluluğu (a limited company shareholder’s liability for public debts).

Sector restrictions

The freedom in Article 3/a of Law No. 4875 applies “unless otherwise provided by international agreements and special laws”. The table below shows the exceptions a foreign investor most often encounters; the list is not exhaustive, and the relevant special law must be checked separately for each line of business.

When a sector restriction is noticed only after registration, the cost is high: the shareholding structure may have to be rebuilt, shareholders changed or the line of business narrowed. For a detailed roadmap for mining investments, see Can a Foreign Company Get a Mining License in Turkey?

The real estate guarantee in Law No. 4875 was rewritten. The original version of the provision was annulled by the Constitutional Court, and the current text limits acquisitions to areas open to acquisition by Turkish citizens. If real estate is to be acquired through the company, the zone and permission regime under Articles 35 and 36 of Land Registry Law No. 2644 must therefore be examined separately; see our guide (in Turkish) Yabancıların Taşınmaz Edinmesi (real estate acquisition by foreigners). For a comparison of buying in your own name and through the company, see Buying Property in Turkey as a Foreign Investor: In Your Own Name or Through a Turkish Company?

Tax: corporate tax, dividend withholding and double tax treaties

A company with foreign capital set up in Turkey is a resident (unlimited) taxpayer because its legal seat is in Turkey, and it is taxed on its worldwide income (Corporate Tax Law No. 5520, Art. 3/1). The foreign nationality of its shareholders does not change the company’s tax status. A foreign company’s branch in Turkey, on the other hand, has no separate legal personality and is taxed as a non-resident (limited) taxpayer only on the income it earns in Turkey (Art. 3/2).

Dividend withholding tax changed recently. Presidential Decision No. 9286, published in the Official Gazette of 22 December 2024, raised the withholding rate on dividend distributions from 10% to 15%, applying to dividends distributed from the date of publication. If there is a double tax treaty between the shareholder’s country and Turkey, the rate in the treaty’s dividend article may be lower; to apply the lower rate, the tax residence certificate that the shareholder obtains in its own country should be given to the company before the dividend is distributed. The whole process, including treaty rates by country and interim dividends, is explained in Dividend Repatriation from Turkey for Foreign Shareholders. On limited tax liability and the application of treaties, see our guides (in Turkish) Dar Mükellefiyet ve Yabancıların Vergilendirilmesi and Yurt Dışı Kazançlar ve Çifte Vergilendirmeyi Önleme.

The transfer guarantee works together with a chain of documents. Before transferring profits, banks may ask for the general assembly resolution, the balance sheet and documents showing that the withholding tax has been paid; inquiries about the source of funds may delay the transfer. For details, see our guide (in Turkish) Yurt Dışına Para Transferi (transfers abroad).

Filings after registration

When registration is complete, the investor considers the job done; yet this is exactly when a series of obligations begins, and investors living abroad most often miss them.

Post-registration obligations should be planned from the outset: tax registration, the accounting system, certification of the statutory books and social security procedures should be started without delay. Failures lead to administrative fines and count against a later work permit application.

The beneficial owner is the individual shareholder holding more than 25% of the company’s shares; if no one can be identified on this basis, the individual who has ultimate control over the company, and failing that the highest-level executive, is treated as the beneficial owner. For a Turkish company whose shareholder is a holding company abroad, the question is traced back to the individual behind the holding company. This information must also match what banks check when opening accounts; a difference between the structure reported to the tax administration and the structure declared to the bank can lead to problems up to and including the suspension of account transactions.

Electronic notification is the quietest risk for a shareholder abroad. A notification is deemed served at the end of the fifth day after it reaches the electronic address, and time limits for objections and lawsuits start running from that date. Tax office notifications are made through the Revenue Administration’s own electronic notification system, where the same fifth-day rule applies (Tax Procedure Law, Art. 107/A). Failing to follow notifications of administrative fines, tax audits or payment orders means debts that become final because time limits were missed. For details, see our guide (in Turkish) Elektronik Tebligat Zorunluluğu (the electronic notification requirement).

The notification of employment is the obligation most often missed in the rush of formation. Under Article 22 of Law No. 6735, employers of foreigners and foreigners holding an indefinite or independent work permit must notify the Ministry within fifteen days of the start and end of employment and of any circumstances that would lead to the cancellation of the permit. Having obtained the permit does not remove this obligation; failure to notify is a separate breach and is subject to sanctions. In newly set up companies this tracking is often never put in place, so the breach arises with the first staff movement.

Branches and liaison offices: current rules

A foreign company that does not want to set up a company has two options. A branch is the parent company’s commercial unit in Turkey and is registered with the trade registry like Turkish businesses; for such branches, a fully authorized commercial representative resident in Turkey must be appointed (TTK Art. 40). Because a branch has no separate legal personality, the parent company is liable for its debts.

A liaison office, on the other hand, is opened with the permission of the Ministry of Industry and Technology and on condition that it does not engage in commercial activity. Under the Implementing Regulation, the initial permission is granted for at most three years; extensions are limited according to the type of activity, and offices authorized for market research or product promotion cannot be extended. Within one month of the permission date at the latest, the office sends its tax registration certificate and lease agreement to the Ministry; it notifies changes in its address, authorized persons and the parent company’s trade name within one month; and it sends its activity information form to the Ministry every year by the end of May. If an office does not submit the annual form, its extension request is not considered and its permission may be canceled ex officio. A liaison office’s expenses are, as a rule, covered by funds transferred from abroad; the office has no income of its own in Turkey. For closing procedures, see our guide (in Turkish) Şube ve İrtibat Bürosu Kapatma (closing a branch or liaison office).

Formation checklist: seven lines

1. Check the special restrictions of your sector.
2. Choose the type (limited company, joint stock company, branch or liaison office) according to what the business will actually do; do not trade through a liaison office.
3. Prepare the apostille and translation set before you come.
4. Set up an address that will withstand the tax office inspection.
5. Add a sworn interpreter to the signing appointment.
6. Complete the bank, notification and social security chain in the week of registration.
7. Above all, make the work permit application for every foreigner who will work in the company part of the formation plan.

Setting up a company in Turkey is easy; setting it up correctly means completing the chain from apostille to permit without gaps. The nationality of the capital does not matter; the signature, the permit and the address will all be checked.

Legislation map

Frequently Asked Questions

Can a foreigner set up a company in Turkey?

Yes. Under Article 3/a of Foreign Direct Investment Law No. 4875, foreign investors are free to make foreign direct investments in Turkey and are subject to equal treatment with domestic investors. There is no special “foreign company permit”, and all of the shares may belong to foreigners.

Are there limits on this freedom?

Yes. The freedom applies “unless otherwise provided by international agreements and special laws”. Special laws impose shareholding or activity restrictions in areas such as mining, banking, media and broadcasting, civil aviation and shipping, so a sector check is the first step of any formation plan.

What is the minimum capital for a company in Turkey?

Since 1 January 2024, TRY 50,000 for a limited company (TTK Art. 580), TRY 250,000 for a joint stock company (TTK Art. 332) and TRY 500,000 for a non-public joint stock company that adopts the authorized capital system (Presidential Decision No. 7887). There is no separate minimum for foreigners; if a work permit will be sought, the capital criterion in the permit rules is assessed separately.

When must the capital be paid?

In a joint stock company, at least one quarter of the cash capital committed is paid before registration into a special bank account in the company’s name, and the rest within twenty-four months after registration (TTK Arts. 344, 345). In a limited company, the cash capital committed is paid within twenty-four months after registration (TTK Art. 585).

Can I set up a company without coming to Turkey?

Yes. The articles of association can be signed through an attorney-in-fact under a special power of attorney issued at a Turkish consulate abroad, or notarized by a foreign notary and used with an apostille and a notarized Turkish translation; the original power of attorney is filed with the trade registry. Steps such as opening a bank account, the work permit and the tax office inspection may still require the investor to come at least once.

Do I have to sign the articles of association at a notary?

For a joint stock company it is not mandatory: the founders’ signatures can be notarized, or the articles can be signed before the director or deputy director of the trade registry (TTK Arts. 335, 339). For a limited company, the notary option was removed by Law No. 7099; the articles are signed before authorized staff at the trade registry office (TTK Art. 575).

Is an interpreter needed at signing?

A founder who does not speak Turkish must be accompanied by a sworn interpreter at signing. For a limited company the signing takes place at the trade registry office, and for a joint stock company at a notary or the trade registry office; the interpreter should be included when the appointment is planned.

What documents does a foreign founder need?

Foreign documents become valid through a chain: the original document, an apostille (or consular legalization in countries outside the apostille system) and a notarized Turkish translation. Individual founders need a translation of their passport; corporate founders need a registry extract or certificate of activity, documents showing signatory powers and a resolution to participate in the formation.

How does a foreign founder get a tax number?

Founders with a residence permit in Turkey act with their foreigner identity number; founders coming for a short time obtain a potential tax number from the tax office. If the founder is a company abroad, that company must also obtain a tax number in Turkey.

When does the company acquire legal personality?

Upon registration with the trade registry: TTK Art. 355 for joint stock companies and TTK Art. 588 for limited companies. For transactions made in the company’s name before registration, the persons who made them may be held liable if the company does not take them over after registration.

Should I choose a limited company or a joint stock company?

Two criteria are decisive for a foreign shareholder: liability for public debts (Law No. 6183, Art. 35 makes limited company shareholders liable in proportion to their shares; it does not apply to joint stock company shareholders) and the share transfer regime (TTK Art. 595 requires notarization and general assembly approval in a limited company).

Can the manager of a limited company be a foreigner?

Yes. Because TTK Art. 623 requires at least one manager to be a shareholder with management rights, in a limited company whose shareholders are all foreign the manager will necessarily also be a foreigner, and that manager needs a work permit. A board member of a joint stock company does not have to be a shareholder.

Do I need a permit to work in my own company?

Yes. Shareholding is a property right; running operations is work and requires a permit under Law No. 6735. In particular, a shareholder who is a manager of a limited company must obtain a work permit.

What is the sanction for working without a permit?

Under Article 23 of Law No. 6735, an administrative fine is imposed on anyone who employs a foreigner without a permit, for each foreigner; the employer also covers the accommodation, return and, where necessary, health costs of the foreigner and of any spouse and children.

Does a work permit count as a residence permit?

Yes. Under Article 27 of Law No. 6735, a work permit also counts as a residence permit, so no separate residence application is needed. If the permit is refused, the residence status must be resolved separately.

Can a shell company be used to obtain a work permit?

No. Under Article 7 of Law No. 6735, applications are assessed against the Law, the regulation, international labour force policy and the Ministry’s evaluation criteria; paid-in capital, the shareholder’s percentage, employment of Turkish citizens, turnover or exports and real premises are weighed. A company with no employees and no turnover does not pass this assessment, and a complete file alone does not guarantee a permit.

What should I check when buying an existing Turkish company?

If its capital is below the new minimum, the company is deemed dissolved unless it increases its capital by 31 December 2026 (TTK provisional Art. 15). In a limited company, the transferee is jointly and severally liable with the transferor for public debts from before the transfer that cannot be collected from the company (Law No. 6183, Art. 35/2); tax and social security debt letters should be obtained, and lawsuits and enforcement records reviewed.

What is the corporate tax rate for a company with foreign capital?

A company set up in Turkey is a resident (unlimited) taxpayer regardless of its shareholders’ nationality (Corporate Tax Law, Art. 3/1). The general corporate tax rate is 25%, and 30% for banks and certain financial institutions (Corporate Tax Law, Art. 32).

How much tax is withheld on dividends paid to a shareholder abroad?

For dividends distributed from 22 December 2024, the withholding rate for non-resident individuals and companies is 15% (Presidential Decision No. 9286). If a double tax treaty provides for a lower rate, the treaty rate can be applied with the shareholder’s tax residence certificate.

Can I transfer my profits abroad?

Yes. Article 3/c of Law No. 4875 guarantees that net profits, dividends, proceeds from sale, liquidation and compensation, payments under license and management agreements, and principal and interest on foreign loans can be transferred abroad freely through banks.

Can my investment be expropriated?

Under Article 3/b of Law No. 4875, foreign direct investments cannot be expropriated or nationalized except where the public interest requires it and compensation is paid.

Can my company acquire real estate in Turkey?

Under Law No. 4875, companies that foreign investors set up or participate in may freely acquire real estate or limited rights in rem in areas open to acquisition by Turkish citizens. The zone and permission regime under Articles 35 and 36 of Land Registry Law No. 2644 must be examined separately.

What is the beneficial ownership notification?

It is the obligation of corporate taxpayers to report to the tax administration the individuals holding more than 25% of the company’s shares or, failing that, the individual with ultimate control or the highest-level executive. New registrations and changes are reported within one month (Tax Procedure Law General Communiqué No. 529).

Does a company with foreign capital have an annual filing?

Yes. Companies with foreign capital and branches submit the Activity Information Form for Foreign Direct Investments through E-TUYS every year by the end of May at the latest; liaison offices send their own activity information forms to the Ministry by the same date.

Why is electronic notification so important?

Notifications are deemed served at the end of the fifth day after they reach the electronic address, and time limits run from that date; tax office notifications go through the Revenue Administration’s own system under the same rule (Tax Procedure Law, Art. 107/A). For shareholders living abroad, unmonitored notifications are the most common cause of lost rights.

Does a foreign company’s branch need a representative in Turkey?

Yes. A fully authorized commercial representative resident in Turkey must be appointed for the Turkish branch of a business whose head office is abroad (TTK Art. 40). Because the branch has no separate legal personality, the parent company is liable for its debts.

Can a liaison office issue invoices?

No. The permission is granted on condition that the office does not engage in commercial activity in Turkey. A breach leads to sanctions under both the permit regime (cancellation of the permission, stopping of the activity) and tax law. The practical test: is income arising in Turkey? If so, the structure is wrong.

For how long can a liaison office be opened?

The Ministry of Industry and Technology grants the initial permission for at most three years. Extensions are limited according to the type of activity, and offices authorized for market research or product promotion cannot be extended.

Is there a notification obligation once a foreigner starts working?

Yes, and it is often missed. Under Article 22 of Law No. 6735, the start and end of employment and any circumstances that would lead to the cancellation of the permit must be notified to the Ministry within fifteen days. Having obtained the permit does not remove this obligation; failure to notify is a separate breach.

What are the most common pitfalls in company formation?

Not checking sector restrictions; trading through a liaison office; leaving a link of the apostille and translation chain missing; setting up an address that will not withstand the tax office inspection; and, most costly of all, not making the work permit application for foreigners who will work in the company part of the formation plan.

Can I use a virtual office address?

The address must be real enough to withstand the tax office inspection under Tax Procedure Law No. 213. If the inspection is negative, the tax registration and the start of business are disrupted.

Can the company open a bank account immediately?

Account opening for companies with foreign shareholders may be slow because of banks’ compliance procedures. This is not only an operational matter: the transfer guarantee in Article 3/c of Law No. 4875 works through banks, so it also affects the exit plan.

Related guides

• Legal Guide for Foreign Investors in Turkey — company formation, real estate, citizenship, tax and arbitration
• Buying Property in Turkey: In Your Own Name or Through a Turkish Company? — Land Registry Law Arts. 35 and 36
• Dividend Repatriation from Turkey for Foreign Shareholders — 15% withholding, treaty rates and the certificate of residence
• Can a Foreign Company Get a Mining License in Turkey? — licensing routes and treaty protection
• Investment Arbitration Against Turkey and ICSID — treaties, preconditions and enforcement of awards
• Can Foreign Investors Buy Shares on Borsa Istanbul? — portfolio investment, disclosure thresholds and tax
• Yabancıların Türkiye’de Şirket Kurması — Turkish version of this article
• Yabancı Sermayeli Şirket Kuruluşu Danışmanlığı — our company formation service (in Turkish)
• Doğrudan Yabancı Yatırımlar Kanunu (4875) — the Foreign Direct Investment Law (in Turkish)
• Yabancı Ortaklı Şirket Kapatma — closing a company with foreign shareholders (in Turkish)
• Yatırım Yoluyla Türk Vatandaşlığı — citizenship by investment (in Turkish)