Mercans CountryIntel ® Turkmenistan Payroll And HR Insights
Despite bold proclamations about attracting foreign investment, tight control over the economy, underdeveloped healthcare and infrastructure as well as a lack of transparency create a difficult foreign investment climate. Citizens must make up 90 percent of the workforce of foreign-owned companies except for foreign owned oil and gas companies which require only 30 percent local workforce. Although there are no formal limitations to foreign ownership of companies, the government has only allowed fully owned foreign operations in the oil sector.
Unfortunately, Turkmenistan does not have a business registration website for use by either domestic or foreign companies. Depending on the type of business, registration may be done at the local statistics office, the Agency for Protection from Economic Risks, the Registration and Tax Departments or the State Commodity and Raw Materials Exchange. There is significant state regulation which is worsened by large-scale corruption and impacted by the COVID-19 crisis.
Entity Registration and Incorporation Requirements
Setting up a new business or expanding an existing one in Turkmenistan is straightforward. Choose how your company operates from a range of entity types that suit your individual circumstance.
Banking Hours: 9:30 am to 5:30 pm from Monday to Friday.
The standard working week is from Monday to Friday from 9:00 am - 6:00 pm.
Labor issues are governed by the Labor Code of Turkmenistan, the Social Welfare code and a number of other regulations.
Natural gas, oil, petroleum products, textiles, food processing
Dates & Numbers
Official State Name
International Dialing Code
Turkmenistan uses a Pay As You Earn (PAYE) system, which means you as an employer are required to withhold and remit all individual income tax, city maintenance fees, voluntary pension fund, and medical insurance contributions on behalf of your employees. All employees, including residents and non-residents, have a flat tax rate of 10%.
It is acceptable to provide employees with online payslips
Payroll reports must be kept for 7 years
Employees receive paid annual leave of 24 days
There are no provisions mandated by law regarding sick leave
16 weeks of paid maternity leave and there is no provision for paternity leave
Maternity & Paternity Leave
Employers are required to provide 15 days’ notice of termination of employment
There are no provisions mandated by law regarding the 13th month salary
13th month salary
20.33 AUD per hour
Overtime pay is set at 2x the employee's ordinary rate of pay for the first 4 hours of overtime completed
Employees paid monthly are entitled to 15 days’ pay for each year of employment of service
Residents are generally taxed on their worldwide income while non-residents are taxed in Turkmenistan only on income derived from Turkmenistan sources.
The general personal income tax rate is 10% which applies to employment income, business and professional income, interest, royalties and capital gains.
Corporate Income Tax
Personal Income Tax
Pension insurance is payable by employers at 20% of the total remuneration provided to local employees. Workers working in hazardous conditions may be required to pay a little more.
Social Security Rate
Social Security Rate for Employers
Social Security Rate for Employees
The employer is required to observe the labor laws, conditions of the employment contract as well as any collective agreement applicable.
Workers must be provided with an employment contract at the start of their employment alongside the social, medical and other services connected with their provision of work. This contract sets out the basic mutual rights and obligations of the parties involved.
Although the official workday is eight hours, government and many private sector employees are often required to work 10 hours per day and even a sixth day without compensation.
Employees automatically received annual leave of 24 calendar days per year.
If neither party demands termination of a fixed term employment contract and the employee continues to work after the expiration of the agreement, the employment contract is for an indefinite period.
Minimum notice period for terminating an employee
Total number of public holidays
Working hours per week
Total number of days for Compassionate & Bereavement Leave
Most international scheduled flights to and from the country have been suspended. All entry is prohibited except for Turkmen nationals, accredited diplomats and their families, permanently registered foreigners and some employees of international companies. A visa and letter of invitation are required to enter or travel through as a visitor.
Stays of over three days require registration with the State Migration Service of Turkmenistan. Non compliance with any of these requirements could lead to prosecution and possible detention.
Work Permit Validity
A duly completed visa application form
Proof of identity, such as a driver’s license
A passport that is valid for at least six months beyond the date on the applicant’s letter of invitation
A copy of the first page of the passport, which must be signed by the applicant
A recent passport photograph
A letter of invitation from a business registered in Turkmenistan
Proof of payment of the visa registration fee
Build the best team and hire top talent compliantly in Turkmenistan. Get in touch with Turkmenistan payroll outsourcing & PEO specialists for a free consultation!