Company formation in Türkiye: choosing the right structure as a foreign investor

Türkiye allows 100% foreign ownership of companies in almost every sector, and incorporation itself is fast — often a matter of days once your documents are in order. The decision that deserves your attention is not whether you can incorporate, but what you incorporate. That choice follows you for years, in tax, liability and the day you eventually sell.

The two main vehicles: Limited vs. Joint Stock

The overwhelming majority of foreign-owned businesses in Türkiye use one of two forms:

Limited company (Ltd. Şti.)

• The default choice for small and medium ventures — simpler governance, lower minimum capital.
• A single shareholder is enough; no board of directors required, a director (müdür) suffices.
• One important caveat: shareholders of a limited company can, in certain cases, be pursued personally for the company's unpaid public debts (taxes, social security) in proportion to their shares — a risk many foreign founders learn about too late.

Joint stock company (A.Ş.)

• The corporate form for larger ventures, holding structures and anyone planning outside investment or an eventual share sale.
• Share transfers are simpler and can be structured more freely; shareholders are better insulated from public-debt liability.
• Governance is heavier — a board, general assemblies, in some cases an auditor — and the minimum capital is higher.

Rule of thumb from twenty years of practice: if you plan to bring in investors, sell shares, or hold real estate through the company, start with a joint stock company. Converting later is possible — but doing it right from day one is cheaper.

Branch or subsidiary?

Foreign companies sometimes ask for a branch instead of a separate Turkish company. A branch is not a separate legal person: its liabilities are the parent's liabilities. It can make sense for narrowly defined operations, but most investors are better served by a subsidiary — a Turkish Ltd. or A.Ş. owned by the parent — which contains risk within Türkiye and simplifies local contracting, hiring and banking.

The incorporation path, step by step

1. Structure and documents: shareholders, capital, share ratios, directors; notarised and apostilled corporate documents if the shareholder is a foreign company; passports and tax numbers for individuals.
2. Registration: the company is registered through the trade registry (via the central MERSIS system); articles of association are signed before the registry.
3. Tax and social security registration, statutory books, and the company's tax office file.
4. Bank account: increasingly the slowest step for foreign-owned companies — banks run their own compliance checks. Plan for it and prepare a clean file.
5. Permits where relevant: regulated sectors (finance, health, energy, education) have their own licensing layers; and foreign directors who will live in Türkiye need work permits.

Minimum capital and costs

Minimum capital requirements were raised significantly in recent years — as of the most recent legislation the floor is 50,000 TRY for a limited company and 250,000 TRY for a joint stock company, with a quarter of subscribed cash capital payable at incorporation for an A.Ş. These figures change; treat them as a starting point and confirm the current numbers before you commit a budget.

After day one: the obligations people forget

A Turkish company is a living organism: monthly withholding and VAT declarations, quarterly and annual corporate tax filings, social security for employees, board and assembly formalities. Most foreign-owned companies outsource this to an accountant (mali müşavir) from day one — budget for it, because compliance failures accumulate silently into personal exposure for directors.

How we handle it from abroad

The entire incorporation can be completed under a consular power of attorney: you sign once at the Turkish consulate near you, and we run MERSIS, the registry, the tax office and the bank file in Istanbul. Typical timeline from complete documents to a registered company: one to two weeks — the bank account being the variable.