How US Entrepreneurs Can Start a Business in Turkey

A US citizen or US company can own 100% of a Turkish company, with no Turkish partner required, under the Foreign Direct Investment Law (Law No. 4875). This 2026 guide walks US founders through the company types, the registration sequence, current tax rates, the work and residence permits you will need, the costs to budget for, and the bank-account hurdle that catches most foreign-owned companies off guard.

Can a US Citizen Fully Own a Turkish Company?

Yes. Under Turkey's Foreign Direct Investment Law (Law No. 4875), foreign investors are treated the same as Turkish nationals. A US citizen or US-incorporated entity may own 100% of the shares of a Turkish company, with no requirement for a local partner and no rule reserving equity for residents. Foreign capital enters under a notification system, not a permission system, so you do not need government approval to invest in most sectors.

The Turkish Commercial Code (TTK, Law No. 6102) governs the formation and running of every commercial company, and the same rules apply whether the shareholders are Turkish or foreign. The practical difference for US founders is documentation: your corporate and personal papers must be apostilled in the US and sworn-translated into Turkish before the Trade Registry will accept them.

You do not need to be in Turkey or hold residence to be a shareholder. The whole company can be formed by a Turkish lawyer acting under a notarized and apostilled power of attorney, with you signing nothing in person. See our Turkish company formation for foreign founders for how that works end to end.

Company Formation in Turkey: Choosing the Right Structure

Most US founders form a limited liability company (LLC) or a joint stock company (JSC) under the TTK (Law No. 6102). A branch or liaison office of your US company is also possible but rarely the right fit. The table below is the fastest way to compare them; the notes underneath explain the trade-offs.

*Limited liability protects shareholders, but managers and directors can be held personally liable for unpaid public debts such as taxes and social-security premiums under tax-collection rules. Pick and instruct your managers carefully.

Limited Liability Company (LLC)

The LLC is the workhorse for foreign founders: minimum capital of TRY 50,000 (raised from TRY 10,000 on 1 January 2024), 1 to 50 shareholders, and a simple management structure. The catch is that share transfers must be notarized and registered, which makes the LLC less convenient if you expect to bring in investors or sell quickly.

Joint Stock Company (JSC)

The JSC suits capital-intensive ventures, startups planning funding rounds, and founders eyeing the citizenship-by-investment route. Minimum capital is TRY 250,000, or TRY 500,000 for companies that opt into the registered-capital (kayıtlı sermaye) system, which is used by larger non-public companies and public companies. Shares transfer by simple endorsement, so the JSC is the cleaner vehicle for share transfers and investment rounds. The articles of association and any shareholder arrangements should be drafted with care; our team handles the shareholder agreements and articles of association that sit underneath the registration.

Step-by-Step Registration Process

Forming a company in Turkey runs mostly online through the Central Registry System (MERSIS) and the relevant Trade Registry Office. For a straightforward LLC, the registration itself takes a few business days once your documents are ready; the slower parts are obtaining tax numbers, opening a bank account, and any work permit.

1. Obtain Turkish tax numbers for every foreign shareholder and director (a potential tax number for individuals), which is required before any banking step.
2. Prepare and legalize documents: passports, and for corporate shareholders the certificate of incorporation, good-standing evidence and an authorizing board resolution, all notarized and apostilled in the US and sworn-translated into Turkish.
3. Draft the articles of association in MERSIS, setting capital, shareholders, the company purpose, and the appointment of managers or directors.
4. Sign and notarize before a Turkish notary or at the Trade Registry, in person or through an apostilled power of attorney.
5. Deposit capital: for a JSC, at least 25% of cash capital must be paid before registration with the balance within 24 months (TTK Art. 344); LLC capital can be paid within 24 months of registration.
6. Register with the Trade Registry, which announces incorporation in the Turkish Trade Registry Gazette and issues your registration documents.
7. Complete tax registration, including the tax office's post-incorporation inspection and the e-signature, e-invoice and e-ledger setup.
8. Open a corporate bank account and register with the Social Security Institution (SGK) before hiring staff.

How long does the whole thing really take?

Because the documentary and translation requirements are exacting, most US entrepreneurs complete the process through a Turkish lawyer holding power of attorney. Contact us to start.

Opening a Corporate Bank Account as a Foreign-Owned Company

This is the step that surprises most US founders, so it deserves its own heading. Incorporation is fast; opening the bank account is where foreign-owned companies stall. Turkish banks apply enhanced due diligence to companies with foreign shareholders, and the rules are applied by each branch with real discretion.

• In-person attendance is often required from a director or authorized signatory, even if the company was formed by power of attorney. Some banks will not finalize an account remotely.
• Beneficial-ownership declarations are mandatory: you must identify the real (ultimate) owners behind any corporate shareholder.
• Documentation is heavy: trade registry extract, tax certificate, signature circular, articles of association, passports and proof of address for beneficial owners, and sometimes an explanation of the source of funds.
• Compliance review can add days or weeks, especially for higher-risk sectors or complex US ownership chains.

Tax Obligations for Your Turkish Company in 2026

A company incorporated in Turkey is a Turkish tax resident and is taxed on its worldwide income. The main taxes sit under the Corporate Tax Law (Law No. 5520) and the VAT Law (Law No. 3065). The headline rates below are current for 2026, but rates change often, so confirm before you budget.

• Corporate income tax: the standard rate is 25%. Finance-sector companies (banks, financial leasing, factoring, insurance and similar) are taxed at 30%.
• Domestic minimum corporate tax: a 10% minimum corporate tax (yurt içi asgari kurumlar vergisi) now applies under Law No. 5520, as amended by Law No. 7524. You calculate tax both ways and pay whichever is higher, so generous deductions no longer push the bill below this floor.
• VAT (KDV): standard rate 20% (raised from 18% in July 2023), with reduced rates of 10% and 1% for certain goods and services.
• Dividend withholding tax: the domestic rate is 15% on profit distributions (raised from 10% effective 22 December 2024). The US–Turkey double-taxation treaty may reduce this for US shareholders; 15% is the baseline the treaty would be reducing from.
• Stamp duty and social-security premiums apply to contracts and payroll respectively.

What US founders must add on the US side

Turkey and the United States have a double-taxation treaty, but a US person stays inside the US worldwide tax net. Two points matter for structure choice:

• Check-the-box treatment: for US tax, a Turkish LLC can often be treated as a flow-through (disregarded or partnership) entity, while a JSC is generally treated as a corporation. That choice changes how Turkish profits and the 15% dividend withholding interact with your US return and your foreign-tax-credit position.
• GILTI / CFC and FBAR: a US-owned Turkish company can be a controlled foreign corporation, pulling its income into your US tax picture, and foreign bank accounts trigger FBAR and FATCA reporting.

Coordinate a Turkish accountant with a US tax advisor before you choose between an LLC and a JSC; the US tax treatment, not just the Turkish one, often decides the structure.

Tax Incentives, Free Zones and R&D for US Founders

Before you settle on a structure, check whether your business qualifies for an incentive, because it can change the tax math and even the location decision.

• Investment incentive certificate (yatırım teşvik belgesi): qualifying investments can access VAT and customs-duty exemptions, tax reductions and SGK premium support. Eligibility depends on sector, region and investment size.
• Free zones: companies operating in Turkish free zones can benefit from corporate-tax and VAT advantages, particularly export-oriented manufacturing.
• Technoparks / R&D and design centres: technology and R&D ventures can access income-tax withholding support on qualifying staff and corporate-tax exemptions on qualifying earnings.

Work and Residence Permits for Founders

Owning shares does not give you the right to live or work in Turkey. If you intend to manage the company on the ground, you generally need a work permit, which also serves as your residence permit while it is valid. We handle this through our work and residence permits for company founders service.

Work permit through your own company

Under the International Labour Law (Law No. 6735), a Turkish company can sponsor a foreign director's or employee's work permit. The capital threshold changed in 2024, and the old figure still circulating online is wrong. Here is the old rule versus the current one:

The sponsoring company must meet at least one of those financial thresholds. On top of that:

• A foreign shareholder-director should hold at least 20% of the company and a contribution of at least TRY 500,000. However, that director is generally exempt from the capital, 20% and Turkish-employee tests if their shareholding is at least USD 100,000.
• The company must normally employ five Turkish nationals per foreign worker. For a founder's first partner work permit this rule is typically waived for the first six months but applies by the first-year renewal.

Residence permits

A founder who is not yet working may enter on a short-term residence permit under the Law on Foreigners and International Protection (Law No. 6458). Buying Turkish real estate or making a qualifying investment can also support residence, and at higher thresholds it can open the route to Turkish citizenship by investment (the well-known routes include roughly USD 400,000 in real estate or a fixed-capital investment; confirm the current threshold before relying on it).

What Does It Cost to Set Up a Company in Turkey?

US founders rightly want a budget before they start. We do not quote our own fees here, but the third-party cost drivers below are predictable and worth planning for. Figures are indicative and shift with exchange rates and tariffs, so treat them as a planning range, not a quote.

• Share capital: TRY 50,000 (LLC) to TRY 250,000+ (JSC), or higher if you are sizing the company for a work permit.
• Notary and signature costs: for the articles, signature declarations and power of attorney.
• Apostille and sworn translation: on every US corporate and personal document; corporate shareholders cost more than individuals because there are more documents.
• Trade Registry and Gazette fees: official charges for registration and publication.
• Accountant retainer: a monthly bookkeeping and filing retainer is effectively mandatory because VAT and withholding returns are filed monthly from day one.
• Work permit fees: government charges and the valuable-paper fee, if you are applying for one.

Sector Restrictions and Licensing

The 100% foreign-ownership default has real exceptions, and a few sectors carry caps or licensing rules. The clearest example is broadcasting: foreign ownership of a media-service provider is capped at 50% under Law No. 6112 (the RTÜK regime). Aviation, maritime cabotage, and parts of energy and defence carry their own limits, and real estate near military or security zones is restricted for foreign buyers.

Common Pitfalls US Entrepreneurs Should Avoid

• Relying on an old capital or work-permit figure: the LLC minimum is now TRY 50,000 and the work-permit capital threshold is TRY 500,000. Guides quoting TRY 10,000 or TRY 100,000 are out of date.
• Under-documenting corporate shareholders: a US LLC or corporation as shareholder needs a properly apostilled certificate, good-standing evidence and an authorizing resolution. Missing apostilles are the single most common cause of delay.
• Assuming the bank account opens itself: enhanced due diligence and in-person requirements stall more launches than incorporation ever does.
• Manager liability for public debts: appointed managers can be personally liable for unpaid taxes and SGK premiums; choose and instruct them carefully, and know your options for enforcing or defending company debts.
• Assuming shares equal residency: plan the work and residence permit track separately and early.
• Ignoring sector restrictions: regulated sectors such as broadcasting, aviation and defence carry foreign-ownership caps or licensing requirements.
• Skipping post-incorporation compliance: e-invoicing, e-ledger, monthly VAT and withholding filings, annual corporate returns and the beneficial-owner notification all begin straight after registration.

Because outcomes depend on your specific facts and the thresholds in force when you act, this article is general information and not legal advice; a Turkish lawyer should review your plan.

Frequently asked questions