Step-by-Step Legal Guide to Forming a Company in Istanbul

1. Choosing Your Company Type

Turkish Commercial Code No. 6102 provides for several company structures. The two most commonly used by foreign investors and entrepreneurs are:

Limited Liability Company (LLC — Anonim Şirketi değil, Limited Şirketi)

• Minimum paid-in capital: 50,000 TRY (raised from 10,000 TRY under Turkish Commercial Code amendments effective 2024).
• Shareholders: between 1 and 50.
• Management by a manager (müdür), who may be a shareholder or an outside appointee.
• Shares are not freely transferable without shareholder approval.
• The most common choice for small and medium enterprises and foreign-owned subsidiaries.

Joint-Stock Company (JSC — Anonim Şirketi)

• Minimum paid-in capital: 250,000 TRY (raised from 50,000 TRY under Turkish Commercial Code amendments effective 2024).
• At least one shareholder (individual or legal entity).
• Management by a board of directors.
• Shares are freely transferable (subject to restrictions in the articles).
• Preferred for larger businesses, those seeking external investment, or companies that may list shares in the future.

2. Step-by-Step Formation Process

Company formation in Istanbul involves a sequential series of filings across multiple authorities. The standard order of operations is:

1. Draft the Articles of Association (Şirket Sözleşmesi): the founding document setting out the company's purpose, capital, management structure, and shareholder rights. Must comply with TCC No. 6102 and be signed before a notary or filed digitally via the MERSİS system.
2. Register for a Tax Identification Number: founders and the company must obtain tax IDs (vergi numarası) from the Turkish Revenue Administration (Gelir İdaresi Başkanlığı) before registration.
3. Deposit 25% of the paid-in capital: a bank receipt showing the deposit of at least 25% of the minimum capital in a blocked account in the company's name is required at registration. The remaining 75% must be paid in within 24 months.
4. Submit registration to the Istanbul Chamber of Commerce (ITO): the Articles of Association, founding documents, tax IDs, and capital deposit receipt are filed with the ITO's trade registry (ticaret sicili).
5. Publication in the Trade Registry Gazette (Ticaret Sicili Gazetesi): registration details are published officially; the publication date marks the company's legal existence.
6. Enrol with the Social Security Institution (SGK): mandatory if the company will employ staff.
7. Notarise company ledgers: mandatory books (journal, general ledger, inventory book, share ledger) must be notarised before use.
8. Notarise the signature circular (imza sirküleri): the authorised signatories' signatures must be notarised for use with banks and authorities.

3. Required Documents

The core document package for an LLC registration includes:

• Valid passports or ID cards of all founding partners (with sworn Turkish translations for foreign documents).
• Proof of residence (domicile certificate or utility bill — apostilled and translated for foreign founders).
• Signature circular(s) notarised in Turkey.
• Bank receipt showing deposit of at least 25% of the paid-in capital.
• Draft Articles of Association.
• Power of attorney if formation is handled by a representative.

For foreign shareholders, all documents issued abroad must be apostilled (or legalised for non-Hague Convention countries) and accompanied by sworn Turkish translations prepared by a certified sworn translator.

4. Tax & Regulatory Obligations

• Corporate income tax: 25% on net profits (rate as of 2026 — verify current rate before relying on this figure).
• Value Added Tax (KDV): standard rate of 20%; reduced rates for certain goods and services. VAT declarations are filed monthly.
• Withholding tax: applicable on dividends, interest, royalties, and certain service payments.
• Stamp duty (Damga Vergisi): applied on certain contracts and official documents.
• Annual general assembly: Turkish LLCs and JSCs are required to hold an annual general assembly within three months of the financial year-end.

5. Frequently Asked Questions

Why choose an LLC over a sole proprietorship?

An LLC provides limited liability protection — the founders' personal assets are not exposed to the company's debts beyond their capital contribution. A sole proprietorship (şahıs işletmesi) offers no such separation. For foreign nationals, the LLC also has a more straightforward visa and residence permit relationship.

Are there additional steps for foreign shareholders?

Yes. Foreign shareholders must provide apostilled and translated identification and residence documents. A valid residence permit is required for foreign individuals who will be employed by or manage the company in Turkey. Foreign legal entities forming a Turkish subsidiary must provide apostilled constitutional documents and board resolutions authorising the formation.

How long does formation take?

With complete documents and no complications, registration through the MERSİS online system can be completed in as little as 3–5 business days for an LLC. Allow 2–3 weeks for the full process including notarial steps, capital deposit, and SGK enrollment.