Good to know
Good to Know
- No Turkish partner, director, or sponsor is legally required — a single foreign individual can own 100% of an LLC or JSC under Turkey's Foreign Direct Investment Law No. 4875.
- Get your Turkish tax ID first — nothing else in the process can proceed without it, and it's usually issued the same day at a local tax office.
- For an LLC, the minimum capital doesn't have to be paid immediately (up to 24 months), which helps cash flow, but a JSC requires 25% deposited in a Turkish bank before the company can even register.
- Opening the corporate bank account is often the slowest and least predictable step for foreign owners — plan extra time here, not at the registry stage.
- Owning a company is a separate matter from being allowed to live or work in Turkey; a residence or work permit is a distinct application and isn't automatic just because you incorporated.
- Every company needs a registered legal address in Turkey; foreign founders who aren't physically present commonly use a virtual office service to satisfy this.
- Turkey's standard corporate tax rate is 25% (30% for banks/financial institutions); a 10% domestic minimum tax also now applies, though brand-new companies are exempt from that minimum for their first three fiscal years.
- For most foreign founders, a Limited Şirketi (Ltd. Şti.) is the realistic default — it can be 100% foreign-owned with no residency requirement, whereas registering as an individual freelancer/sole trader (Şahıs Şirketi) has murky and inconsistently-reported eligibility rules for foreigners who aren't citizens or long-term residents.
- Calendar-year companies file their annual corporate tax return by 30 April, plus quarterly advance tax filings and (typically monthly) VAT returns — budget for an ongoing local accountant (muhasebeci), as Turkish bookkeeping and e-filing requirements are not realistically DIY for most foreign owners.
- Dividends sent from a Turkish company to a foreign owner are subject to 15% withholding tax unless your home country has a double tax treaty with Turkey that reduces it — Turkey has such treaties with 80+ countries, so it's worth checking your specific one before repatriating profit.
Common Business Structures
Limited ŞIrket (LLC) — Most Common for Foreign Solo founders/consultants/SMEs
- Minimum Capital
- TRY 50,000
- Capital Payment Rule
- Capital does not need to be paid up front; it can be paid within 24 months of registration.
- Minimum Shareholders
- 1 (up to 50)
1
- Type
- Anonim Şirket (JSC) — used for larger operations, future investors, or regulated sectors like finance
- Minimum Capital
- TRY 250,000
- Capital Payment Rule
- At least 25% (62,500 TRY) must be deposited in a Turkish bank before registration; the remainder is payable within 24 months.
- Minimum Upfront Deposit
- TRY 62,500
Typical Cost Excluding Capital
Official Government And Admin Fees
- Includes
- Trade registry fees, notary charges, sworn translations, and Trade Registry Gazette publication for a standard LLC.
- Range Low
- TRY 26,000
- Range High
- TRY 62,000
Typical Professional Legal Or Cpa Consultancy Fee
- Range Low
- TRY 93,740
- Range High
- TRY 234,350
- Note
- Optional but commonly used by foreign founders, especially for remote setups; quoted directly in USD by most Turkish CPA/law firms.
Business Tax And Structure Options
Corporate Tax
- Standard Rate
- 25% standard corporate income tax rate on net accounting profit, applying to resident companies on worldwide income and to permanent establishments of foreign companies on Turkish-source income.
- Financial Sector Rate
- 30% for banks and a defined group of financial institutions.
- VAT
- Standard VAT (KDV) rate is 20%, with reduced rates of 10% and 1% on certain goods/services.
- Residency Test
- A company is treated as a full (worldwide-income) Turkish taxpayer if its legal seat or its place of effective management is in Turkey; otherwise it is taxed only on Turkish-source income.
- Incentive Zones
- Turkey's roughly 18 Free (Economic) Zones and its Technology Development Zones can offer 0% corporate tax for qualifying export/manufacturing or R&D and software activity respectively; income earned outside the zone activity is taxed normally. Export-derived corporate income also gets a 5-point rate reduction, with a further 1-point reduction for certified manufacturers.
- Dividend Withholding
- Dividends paid by a Turkish company to a non-resident (foreign) shareholder are subject to 15% withholding tax, unless reduced under a double tax treaty. Turkey has double tax treaties with more than 80 countries.
- Domestic Minimum Tax
- A domestic minimum corporate tax of 10% of adjusted corporate income applies from the 2025 fiscal year onward (declared in the 2026 filing cycle), even if standard deductions/exemptions would otherwise reduce the bill lower. Newly established companies are exempt from this minimum tax for their first three fiscal periods.
- Global Minimum Tax Note
- A 15% global minimum effective tax rate (OECD Pillar Two / GloBE) applies only to Turkish entities that are part of a multinational group with consolidated group turnover of EUR 750 million or more — irrelevant for the vast majority of foreign-owned small businesses or solo-founder companies.
Filing Obligations
- Annual Corporate Return
- Annual corporate tax return due by the 30th day of the fourth month after fiscal year-end — for calendar-year companies that means filing (and paying the assessed tax) by 30 April of the following year.
- VAT Filing
- VAT returns are generally filed monthly through the Revenue Administration's e-filing system.
- Bookkeeping
- Registered companies (Ltd. Şti. or A.Ş.) must maintain formal books and records in accordance with Turkish Accounting Standards, essentially requiring an ongoing local accountant (muhasebeci) even for a small foreign-owned company.
- Self Assessment
- Turkish corporate tax runs on a self-assessment basis — the company (via its accountant) calculates its own taxable income and files electronically through the Revenue Administration's systems; there is no separate provincial/municipal layer of corporate income tax.
- Advance Quarterly Tax
- Quarterly advance ('temporary') corporate tax returns are due on the 17th day of the second month after each quarter, calculated at the current corporate tax rate.
Structure Comparison
- Practical Takeaway
- For a foreigner who is not a long-term resident or citizen, forming a Limited Şirketi is generally the more accessible and predictable structure — it avoids the residency/citizenship ambiguity attached to sole-trader status, at the cost of higher setup formality, mandatory bookkeeping, and the 25% corporate tax rate versus the lower end of the personal income tax scale.
Limited Company
- Liability
- Liability is limited to the company's capital, unlike the sole proprietorship route.
- Ownership
- Can be 100% foreign-owned with no requirement for a Turkish partner or Turkish residency of the shareholders; this is the standard route for a foreign entrepreneur or remote business owner who wants a distinct legal entity, limited liability, a company bank account, or the ability to run payroll for themselves.
- Turkish Name
- Limited Şirketi (Ltd. Şti.) — the most common vehicle — or Anonim Şirketi (A.Ş., joint-stock)
- Tax Treatment
- Subject to the standard 25% corporate tax rate on net profit (worldwide income if Turkish-resident), plus VAT, withholding and the domestic minimum tax rules described above.
- Setup Requirements
- Requires registration through the MERSIS online system, a notarized founding agreement, a potential tax number for every foreign shareholder/manager, and registration with the Trade Registry; formal bookkeeping under Turkish Accounting Standards is mandatory from day one.
Sole Proprietor Freelancer
- Setup
- No minimum capital is required and registration at the local tax office can be completed quickly once a Turkish tax ID is obtained; VAT registration is required once turnover triggers the threshold.
- Liability
- There is no legal separation between the owner and the business — the individual is personally liable for all business debts.
- Turkish Name
- Şahıs Şirketi / self-employed ("serbest meslek") registration
- Tax Treatment
- No separate corporate tax filing — profits are taxed as personal income under Turkey's progressive income tax scale (15% to 40%), with the annual return normally due by 31 March of the following year and payment in two installments.
- Foreigner Eligibility Caveat
- Eligibility for a foreigner to operate this way is genuinely inconsistent across sources: some describe foreign nationals registering as Şahıs Şirketi with a valid residence or work permit, while others state that self-employed ('independent work permit') status is only granted to foreigners who have resided in Turkey legally and continuously for at least 5 years, or that acting as a sole trader otherwise requires Turkish citizenship or a permanent residence permit. In practice, most newly-arrived foreign founders in Istanbul do not use this route and default to forming a company instead.
Core Steps
Core Steps
- Obtain a Turkish tax identification number (potansiyel vergi numarası) for each foreign shareholder and director at the local tax office — usually issued same day with a notarized/apostilled passport copy.
- Reserve the company (trade) name and draft the Articles of Association through MERSIS, the Ministry of Trade's Central Registry Record System.
- Notarize the Articles of Association and required declarations; foreign-issued documents (passports, corporate resolutions, certificates of good standing) must be apostilled and sworn-translated into Turkish.
- Deposit any capital required at incorporation (mandatory 25% for a JSC; optional/deferred for an LLC) and pay the Competition Authority contribution.
- File the application with the relevant provincial Trade Registry Directorate; the company is registered and the incorporation is published in the Turkish Trade Registry Gazette.
- Complete post-registration steps: tax office registration and address verification visit, certification of legal books, e-signature/e-notification setup, and registration with the Social Security Institution (SGK) before hiring staff.
- Open a corporate bank account — this step often takes the longest for foreign-owned entities due to compliance checks.
Realistic Timeline
- Pure Registration Via Mersis
- 3 to 7 business days once all documents are ready
- Realistic End To End For A Foreign Founder
- 1 to 3 weeks, with document apostille/translation and corporate bank account opening being the main bottlenecks rather than the registry step itself
Remote Incorporation
Fully remote formation is possible. A foreign founder grants a notarized and apostilled power of attorney (executable at a Turkish consulate abroad) to a local representative or lawyer, who then completes tax ID applications, MERSIS filing, Articles of Association signature, and Trade Registry filing on the founder's behalf. Opening the corporate bank account and some final signatures can still require in-person action or a specialized notarized POA.
Official Registry Links
Official Registry Links
Local Partner Or Sponsor Requirement
- Status
- Not required
- Details
- Foreigners can own 100% of a Turkish company with no Turkish shareholder, director, or sponsor mandate. This applies equally to a Limited Şirket (LLC) and an Anonim Şirket (JSC).
AI-generated estimateData refreshed July 2026
Sources cited for this category
These are the sources cited in this business permits & incorporation for foreigners research for this city. Individual figures may not each trace to one of them.
More About Istanbul
Data last updated July 2026 · Verify anything important.