Do business in Turkey and reduce costs with Mercans HRM and payroll outsourcing services

  • As an in-country payroll outsourcing, PEO/GEO, employee leasing, recruitment, local compliance and BPO outsourcing services provider in Turkey, Mercans helps you to successfully do business in Turkey. No need to worry about setting up an entity, recruiting and payrolling staff in Turkey. For your security and your peace of mind, Mercans guarantees full compliance with all the Turkish labor laws and employment regulations. Outsource payroll, PEO, human resource management, recruitment, and/or business process and mobilize any number of resources quickly and focus on building your business in Turkey while we take care of the rest.

1 Current context in Turkey –
One of the World’s Newly Industrialized Countries

  • Turkey is defined by economists and political scientists as one of the world’s newly industrialized countries. Having a strategic geographical location that allows it to be a regional hub between Europe, Asia and the MENA economic zones. A natural bridge between both East-West and North-South axes, thus creating an efficient and cost-effective outlet to major markets. Turkey is among the world’s leading producers of agricultural products; textiles; motor vehicles, transportation equipment; construction materials; consumer electronics and home appliances.
  • Turkey has the world’s 19th-largest nominal GDP, and 13th-largest GDP by PPP. Beside this; Turkey has the largest youth population compared with the EU and half of the population in Turkey is under the age of 31.7. Because of its demographic vitality, Turkey has a developing young middle-class population with increased purchasing power and orientation towards consumption.

2 Entity Registration & Incorporation Requirements in Turkey

2.1 A legal entity must be established before doing business in Turkey

  • The main goal of the New Turkish Commercial Code (TCC) is to develop a corporate governance approach that meets international standards; to foster private equity and public offering activities; to create transparency in managing operations; and to align the Turkish business environment with the EU legislation, as well as for the accession process. It is possible to establish a company in a single day by applying to the relevant trade registry office with the required documents.
  • The TCC provides several company structures in Turkey:
    • Joint Stock Company
    • Limited Liability Company
    • Commandite Company
    • Collective Company
    • Cooperative Company
  • The Joint Stock Company (Anonim Sirket, A.Ş.) and the Limited Liability Company (Limited Şirket, Ltd.) are the most common forms of companies under Turkish Commercial Law. Both have same establishment procedures in Turkey before the relevant authorities. However, these companies slightly differ in terms of their main characteristics.
the joint stock company (Anonim Şirket, A.Ş.) The Limited liability company (Limited Şirket, LTD)
Legal Status Independent legal entity Independent legal entity
Numbers of shareholders Min:1
Max: No limit
Max: 50
Capital Requirements Minimum Total Capital: 50,000 TL Minimum Total Capital: 10,000 TL
Legal Reserves Must be provided Must be provided
Tax Status Full tax liability Full tax liability
Corporate Income Tax Rate 20% 20%

2.2 Company structures in Turke

  • Join Stock Company in Turkey

    The Company’s stock capital is divided into shares and the liability of the shareholders is limited to the subscribed capital and paid by the shareholder. At least one shareholder (real person or legal entity) and a minimum capital of TRY 50,000 are mandatory. The mandatory company shall include a general assembly and a board of directors.

  • Limited Liability Company in Turkey

    It is a company established with at least one shareholder (real person or legal entity) and the liability of the shareholders is limited to the subscribed capital and paid by the shareholder. A minimum capital of TRY 10,000 is mandatory.

  • Commandite Company in Turkey

    It is the company established to operate a commercial enterprise under a trade name. Whereas the liability of some shareholders is limited to the capital subscribed and paid by the shareholder (commanditer), for some shareholders there is no limitation of liability. Legal entities can only be commanditer. No minimum capital is required. The rights and obligations of the shareholders are determined by the articles of association.

  • Collective Company in Turkey

    It is the company established to operate a commercial enterprise under a trade name and, the liability of none of the shareholders is limited only to the capital subscribed and paid by the shareholder. No minimum capital is required. It is mandatory that all the shareholders be real persons. The rights and obligations of the shareholders are determined by the articles of association.

2.3 Company Establishment Procedures to do business in Turkey

  • Three copies of articles of association (one copy original) which are notarized are prepared. Following the notarization of articles of association, within 15 days at the latest and application to the relevant trade registry office with the documents set below is needed.
Documents for the Company Establishment in Turkey
  • A company establishment petition and a notification form duly filled in and signed by persons authorized to represent the company. The list of the documents to be procured, and forms to be filled can be downloaded at and
  • Articles of association including notarized signatures of founders and notary certification proving that all shares constituting the registered capital have been subscribed by the founders in the articles of association
  • Founders’ statement signed by the founders
  • The bank letter proving that the share capital has been deposited
  • The bank receipt indicating that 0.04% of the company capital has been deposited to the account of the Turkish Competition Authority at a state bank
  • Permit or letter of compliance for companies whose corporation is subject to the permit or letter of compliance issued by the relevant ministry or other official institutions
  • Notarized copy of signatures of persons with the authority to represent and bind the company
  • Application number indicating that the trade name to be used has been checked and confirmed by the Trade Registry Office
  • Company establishment statement form (3 original copies)
  • Certificate of residence of founding partners
  • . Notarized translation of passport in the case of the foreign shareholder being a real person; apostilled and notarized translation of registry document issued by the competent authority in case the foreign shareholder is a legal entity.

3 Foreign Direct Investment in Turkey

  • The Turkish Government welcomes inward investment from foreign multinational corporations. Government policy including low levels of taxation and attractive incentives provides a welcoming environment for investors. Turkey has a developed infrastructure and stable political environment that further supports investment opportunities.

4 Registration with the Tax Office to do business in Turkey

  • Please note that corporate entities in Turkey require an office address to be registered with the tax office on the same day or before the registration date. A tax registration number is received, and legal books are certified by a Public Notary. The rent contract must be certified by the Notary Public as well as the notarized Circular of Signatory which should be submitted to the related Tax Office.
  • The registrations of the company for payroll purpose with the Tax and Social Security Institute are completed during the legal entity establishment process.
  • It is worth mentioning that having the “umbrella service” which some payroll provider’s offer can be a solution for processing payroll without a legal entity in Turkey.

5 Banking in Turkey

  • According to Turkish Labor Law, wages, bonuses, premiums of employees in the workplaces employing 5 or more employee must be paid through banks as of 1st June 2016. Employees must open an account in Turkish Banks before starting to work.
  • Also, for employer starting with 01.01.2020 all tax payments have to be done only from Turkish government banks. Which means the employer have to open an account in Turkey from one of the below government banks.
  • The banks in Turkey work 5 days a week, taking the Saturday and Sunday as weekly rest days. Banks are open from 09:00 to 17:00, Monday to Friday.
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