Turkey

Turkey - Civil Law (Swiss)
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Turkey taxes

Do you want to incorporate in Turkey? This article explains the tax laws in Turkey for a LLC which is the most common legal entity in Turkey.

Turkish companies are liable to tax on their worldwide income. The headline tax rate for offshore income, from our research, and these things do change, is 20%. Turkey may have certain exemptions to transfer income accrured abroad. Taxes are reasonable in Turkey as the headline corp. tax rate is 20%. This ranks Turkey as 70th overall in terms of corporate tax rate worldwide.

The valued added tax rate is 18.00%, this ranks Turkey as 116th overall in terms of VAT taxation rate internationally. In terms of other taxation, an employer will contribute 22.50% to the equivalent of a social security fund and an employee will contribute 14.00%. The overall complexity of the tax system is medium. This is measured by average time to comply with a country's labor tax requirements is as it is 80hours. Contributing to this is the number of yearly labor tax payments, which is 1 in TR.

Thin cap standards are officially enacted. This refers to any sort of restrictions on given company with respect to debt-to-asset ratios.
Dividends distribution between resident companies are tax-exempt. Dividends received from foreign companies may be subject to corporate income tax. However an exemption applies, if paying company is a LLC or a corporation, the recipient owns at least 10% of the paid in capital of the distributor, profits were taxed on source at a CIT of at least 15%, and the dividends are received by the date the corporate tax return is due. A dividend are payments of earnings of the business, passed by the board of directors, to shareholders.Dividends can be one of the following stock, cash, or property.
Capital Gains are usually considered ordinary income and subject to corporate income tax standard rates. However, those from the sale of domestic participation may be 75% exempted if the property has been held at least two years. Turkish-source and foreign source Capital Gains derived by a Turkey International Holding Company may be exempted under certain conditions. A capital gains tax is levied on the profits that a corporation or natural person realizes when they sell sells a capital asset for a price that is higher than the purchase price.

The interest withholding tax rate is estimated at 10%. Which means that the taxman expects relevant legal entities to automatically withhold 10% of interests remitted abroad, unless those are paid to international financial entities, where an exemption may apply. The dividends withholding tax rate is 15%. This should be interpreted that the taxman expects LLC's to withhold 15% of dividends remitted abroad. The royalties withholding tax rate is 20%. This means that the relevant tax authorities expects LLC's to pay tax on 20% of payments of royalties made to non-residents. Withholding tax rates may be reduced under a tax treaty.
There is no known tax on wealth in Turkey. There are inheritance, transfer and real estate property taxes in Turkey. There are widely used R&D initiatives that provide tax incentives in TR.

The above is not tax or legal advice for your particular situation. We can refer you to a lawyer in Turkey who can answer all your questions. Click the free consultation button above.

It takes approximately 49 hours to file and prepare documents for a Turkey Civil Law (Swiss).
The corporate tax is approximately 20% which is 70 in the world.

Owners of a company in Turkey are not allowed to carry back a loss and may be allowed to carry forward a loss for 5 years.

The vat rate in Turkey is 18% which ranks 116 in the world.

Patent box
RND credit
Wealth tax
Estate tax
Transfer taxes
Asset taxes
Capital duties
87Tax treaties
20%Offshore Tax
20%Corp rate
-Loss carryback years
49Corporate time
18%VAT rate
20%Capital gains
2018AEOI planned

Read this to learn about incorporating a company in
Turkey

We can help you form a company in Turkey. Click the button above for a no-obligation quote. We will provide you with all the necessary documents to open a bank account as well as a registered office in Turkey, which is required by law.

We can help you with your incorporations needs for an initial payment of just $1000.

Easy Step by Step Process:
The standard process typically takes between two (2) to three (3) weeks depending on when we receive all the required information from you. Once we receive your information, we will email you a complete set of documents for your review within 3 working days upon confirmation of payment. After executing the documents, you will need to mail them to us and we will formally submit your application for filing with the Registry. The Registry will then take about 3-8 working days to process the incorporation and produce certificates necessary for opening your bank account.

Applying for Your Bank Accounts:
Incorporations.IO maintains close working relationship within our extensive network of partner banks to help you apply for and receive banking services that are most appropriate to your specific situation. From the time of verification of incorporation it can take (1) one week to (2) two weeks to apply for and receive a bank account. We work primarily with banks that allow for remotely opened accounts to ensure you are ready to do business as soon as possible.

Applying for Payment Processing:
We include introductions to payment processors or merchant accounts with all of our incorporation services. Whether you just need standard credit card processing or specialized services for high risk processing, we have partners that can assist you and are happy to help you with introductions that can empower your business.

Start Online or via Phone:
We can get started for you whenever you are ready via a US$1000 initial payment via credit card. I get notified whenever a payment is made here and would send out the welcome letter and initial forms we would need within 12 hours. If you prefer, we can also process via a phone or Skype call.

Turkey Tax Treaties

CountryTypeDate signed
Qatar
DTC 2001-12-25
Gibraltar
TIEA2012-12-04
Mexico
DTC 2013-12-13
Yemen
DTC 2005-10-26
Bangladesh
DTC 1999-10-31
India
DTC 1995-01-31
Uzbekistan
DTC 1996-05-08
Malta
DTC 2011-07-14
Kosovo
DTC 2012-09-10
Brazil
DTC 2010-12-16
Spain
DTC 2002-07-05
Slovakia
DTC 1997-04-02
Ukraine
DTC 1996-11-27
Luxembourg
DTC 2003-06-09
Netherlands
DTC 1986-03-27
Malaysia
DTC 1994-09-27
Romania
DTC 1986-07-01
Egypt
DTC 1993-12-25
Macedonia
DTC 1995-06-16
Pakistan
DTC 1985-11-14
Belgium
DTC 1987-06-02
Poland
DTC 1993-11-03
Hungary
DTC 1993-03-10
Portugal
DTC 2005-05-11
Estonia
DTC 2003-08-25
Czech Republic
DTC 1999-11-12
Sweden
DTC 1988-01-21
Lithuania
DTC 1998-11-24
Ireland
DTC 2008-10-24
Oman
DTC 2006-05-31
Iran
DTC 2002-06-17
Italy
DTC 1990-07-27
New Zealand
DTC 2010-04-22
Georgia
DTC 2007-11-21
Tajikistan
DTC 1996-05-06
Singapore
DTC 1999-07-09
Australia
DTC 2010-04-29
Finland
DTC 2009-10-06
France
DTC 1987-02-18
Mongolia
DTC 1995-09-12
Thailand
DTC 2002-04-11
Norway
DTC 2010-01-15
Bahrain
DTC 2005-11-14
Morocco
DTC 2004-04-07
South Korea
DTC 1983-12-24
Guernsey
TIEA2012-03-13
Ethiopia
DTC 2005-03-02
Isle of Man
TIEA2012-09-21
Germany
DTC 2011-09-22
Saudi Arabia
DTC 2007-11-09
China
DTC 1995-05-23
Jordan
DTC 1985-06-06
Switzerland
DTC 2010-06-18
Montenegro
DTC 2005-10-12
Albania
DTC 1994-04-04
Turkmenistan
DTC 1995-08-17
Sudan
DTC 2001-08-26
Indonesia
DTC 1997-02-25
Kyrgyzstan
DTC 1999-07-01
Bulgaria
DTC 1994-07-07
Kuwait
DTC 1997-10-06
Moldova
DTC 1998-06-25
Austria
DTC 2008-03-28
Latvia
DTC 1999-06-03
Vietnam
DTC 2014-07-08
Azerbaijan
DTC 1994-02-09
United Kingdom
DTC 1986-02-19
Denmark
DTC 1991-05-30
Canada
DTC 2009-07-14
Greece
DTC 2003-12-02
Belarus
DTC 1996-07-24
Japan DTC 1993-03-08
South Africa
DTC 2005-03-03
Algeria
DTC 1994-08-02
Kazakhstan
DTC 1995-08-15
Tunisia
DTC 1986-10-02
Russia
DTC 1997-12-15
Lebanon
DTC 2004-05-12
Bosnia and Herzegovina
DTC 2005-02-16
Israel
DTC 1996-03-14
Bermuda
TIEA2012-01-23
United Arab Emirates
DTC 1993-01-29
Syria
DTC 2004-01-06
Slovenia
DTC 2001-04-19
Croatia
DTC 1997-09-22
Jersey
TIEA2010-11-24
United States
DTC 1996-03-28

Country Info

National Flag of
Türkiye Cumhuriyeti (tur)
Currency
TRY
Area Code
+90
Capital
Ankara
Region
Western Asia
Native Languages
Turkish

Companies Act of Turkey

TURKISH COMMERCIAL CODE

Law No. 6762 dated 2 july 1956 Enacted on 29 June

Preliminaries Field of application of the code

I- Commercial clauses

Section I – The Turkish Commercial Code is an integral part of Turkish Civil Code. The provisions of thisCode and the special provisions of other Laws concerning transactions, acts and affairs interesting any trading house, factory or establishment operated commercially are commercial clauses. In commercial affairs for which there is no commercial clause the court shall decide according to commercial usage and customs and, in the absence of the same, according to general prescriptions.

II- Commercial usage and custom:

Section 2- In the absences of any clause to the contrary in the Law, practice may not be taken as a basis for judgment as long as it is not admitted as commercial usage and custom. The principle of considering also practice is, however reserved in the interpretation of the declaration of intention. Commercial usages and customs special to region or to a trade shall be preferred to usages and customs in general. If the parties concerned are not in the same region, the commercial usages and customs of the place of execution shall apply as long as there is no provision to the contrary in the law or in the contract. Commercial usage and custom shall apply to persons not having the capacity of merchant only if

they are or should be known to them.

III- Commercial affairs:

Section 3- Matters regulated in this Code and all transactions, acts and business interesting a trading house, a factory or another establishment which is commercially operated are commercial affairs.

Chapter IV – Unfair competition :

In general : 1 – Definition :

Section 56. Unfair competition is the abuse of economic competition in any manner by means of deceitful acts or other acts incompatible with good faith.

II- Acts incompatible with good faith:

Section 57. Acts incompatible with good faith are as follows:

1- Discrediting others or their goods, their activities, or the products of their work or their commercial affairs by means of wrong, deceitful or uselessly offensive statements;

2- Giving information contrary to truth regarding the morality or financial capacity of another person;

3- Giving wrong or deceitful information regarding one’s own situation, goods and the products of one’s work, one’s commercial activitiy or commercial affairs of acting in the same manner regarding third persons and putting them in a situation above their competitors.

4- Acting as if one had obtained a distinction, degree or reward without having obtained the same and trying to create thus the impression that one has exceptional capacities or using false titles or professional names which are liable to create this impression.

5- Trying to create confusion with the goods and products of the work, the activity or the commercial undertaking of another person or having recourse to measures likely to create this confusion, particularly using names, titles, marks, signs and similar distinctive means legally used by another person, or selling or keeping for a reason other that personal needs, goods giving place to confusion, knowingly or unknowingly.

6- Assuring or promising to the employees, agents or other assistans or third persons advantages to which they are not entitled with a wiev or in a manner to secure advantages for self or for others by inciting them to fail in their duty.

7- Deducing the employees, agents or other assistants and getting them to divulge or obtain the trading or manufacturing secrets of their employer or of his agents.

8- Taking an illicit advantage from trading or manufacturing secrets obtained or learnt in a manner incompatible with good faith or divulging them to others.

9- Issueing certificates of good conduct or capacity, contrary to truth so as to deceive persons of good faith.

10- Failing to comply with the conditions of working life determined by laws, regulations, contracts and professional or local customs which are also effective as regards competitors.

B) Juridical liability: 1. Miscellaneous clauses:

Section 58. Anyone who, through unfair competition, suffers injury as regards his customers, his credit, his professional reputation, his commercial undertaking, or his other economic interests or is exposed to such a danger may demand:

(a) the establishment of the existence of unfair competition;

(b) the prevention of unfair competition;

(c) the suppression of the material conditions resulting from unfair competition and, if unfair competition rests on untrue or deceitful statements, the rectification of these statements;

(d) compensation of damages, if there is a fault;

(e) the payment of moral damages in case of existence of the circumstances in Section 49 of the Code of Obligations.

The judge may also order the payment of the value of advantages which the defendant might secure through unfair competition, as damages in favour of the plaintiff and in accordance with the provision Paragragh (d). Customers whose economic interests have been injured through unfair competition may also open the actions indicated in the first paragraph. Chambers of Commerce and Industry, craftsmen’s associations, Exchanges and other professional and economic unions empowered to protect the economic interests of their members according to their statutes may also open the actions indicated under Paragraphs (a), (b) and (c) where their members or the members of their branches have the right to sue in accordance with the first and second Paragraphs. Any judgment passed against a person in pursuance of sub-paragraphs (a) and (b) of the first Paragraph shall also be enforceable against persons having –1 033obtained directly or indirectly the goods which are the object of unfair competition.

II- Liability of employer:

Section 59. lf unfair competition is committed by employees or workers during their service or work, the actions mentioned under sub-paragraphs (a), (b) and (c) of the first Paragraph may be brought also against their employers. The provisions of the Code of Obligations apply to actions mentioned under subparagraph (d) and (e) of the first Paragraph of the foregoing section.

III- Responsibility of the press:

Section 60. – If unfair competition has been committed through the press, the actions mentioned under Paragraphs (a), (b) and (c) of Section 58 may be brought only against the persons having written the article or given the advertisement.

(a) If the article or the advertisement have been published without the knowledge or the approval of the author of the article or of the advertiser;

(b) If it is refused to disclose the identity of the person having written the article or given the advertisement;

(c) If, for other reasons, it is impossible to find out the author of the article or the advertiser or to sue them before a Turkish court; These actions may be brought also against the editor in chief and if it is an advertisement, against the advertising manager, if the editor in chief or the advertising manager have not been designated or do not exist, against the publisher and if he has not been designated either, against the printer. Furthermore, if a fault can be attributed to the editor in chief the advertising manager, the publisher or the printer, an action may be brought against the persons who are at fault, without taking into account the foregoing order. The provisions of the Code of Obligations apply for the actions indicated under subparagraph (d) and (e) of the first Paragraph of Section 58.

IV- Publication of the judment

Section 61. On application by the winning party the court may order the publication of the judgment, after it has become final, at the expense of the losing party, The judge shall determine the form and the extent of the advertisement.

V- Prescriptions:

Section 62. Actions indicated under Section 58 are barred by limitation at the and of one year after the date at which the party entitled to sue has obtained information that these rights have originated and in any case at the end of three years after these rights have originated. If however a punishable act has been committed which is subject to a longer period of prescription according to penal laws, this period shall also apply in civil actions.

VI- Measures of conservation:

Section 63. Following the petition of the person entitled to sud, the court may decide that the existing conditions be maintained, that the material situation resulting from unfair competition be suppressed as indicated under sub-paragraphs (b) and (c) of the first Paragraph of Section 58, that unfair competition be prevented, that untrue or deceitful statements be rectified and that the other necessary measures be taken, in accordance with the provisions of the Civil Procedure Code regarding measures of conservation.

C) Penal liability: I- Punishable acts:

Section 64. I- Anyone who commits wilfully the acts of unfair competition indicated under Paragraphs I; 2, 4, 5, 6, 8 and 9 of Section 57;

2- Anyone who intentionally supplies untrues or deceitful information regarding his personal situation, his goods, the products of his work, his commercial activity and his business so as to have his proposals and offers preferred to those of his competitors;

3- Anyone who seduces employees, agents and other assistants in order to get them to disclose the trading and manufacturing secrets of his employer or principals;

4- Anyone who learns from employers or agents that their worker employees or agents commit an act of unfair competition liable to be punished, when doing his work, and does not prevent this act or does not rectify statements contrary to truth; Shall, on a complaint made by one of those who are entitled to bring a civil action under section 58, be sentenced by the criminal court to imprisonment for a term of one month to one year or to a fine of 500 to 1.000 liras, or to both penalties. Anyone who continues the act of unfair competiton, unchanged or with accessory changes, not withstanding the final judgment concerning the prohibition of unfair competition shall be liable to imprisonment for a minimum term of six months and to a heavy fine of 5.000 to 10.000 liras and the offender shall be prosecuted ex officio.

II- Penal liability of legal entities:

Section 65. If an act of unfair competition has been committed when doing the work of legal entities, the provision of Section 64 shall apply to partners or to the members of the organ having acted or who should have acted on behalf of the legal entity. The legal entity is, however, liable to the fine and to expenses jointly with these real persons.