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Starting a company is an exciting process, but it requires attention to many details. Taking the right steps ensures that your company is successfully established and operates smoothly.
In this article, we will discuss important points to consider when starting a company in Turkey, from choosing the type of company to tax advantages, professional support, and invoice type selection.
Choosing the Type of Company
First, you need to decide which type of company to establish. Taxation is an important factor when choosing the type of company.
For example, if you establish a sole proprietorship (şahıs şirketi), you will be required to pay income tax. Depending on your annual income, this rate can vary between 15% and 40%.
If you are considering establishing a limited liability company (limited şirket) or a joint-stock company (anonim şirket), the corporate tax rate is fixed and does not change based on annual income. According to corporate tax law, this rate is specified as 20%, but for 2024, this rate has been set at 25%.
Choosing the Company Address
When determining your company address, you have three options: renting an office, using a home office, or opting for a virtual office. If you use a home office, you can declare the rent as an expense, but you are obligated to pay a withholding tax of 20% on the rental amount. In the case of virtual offices, you do not have to pay withholding tax.
Government Incentives
Another aspect to consider when starting a company is government incentives. KOSGEB provides support to companies in this regard. Different support options are available based on whether you are subject to corporate tax or income tax.
The key point to remember is that you need to complete the training provided by KOSGEB and obtain a certificate before establishing your company. After receiving your certificate, you should establish your company and apply for KOSGEB support. If you establish the company first and take the training later, you will lose the right to receive KOSGEB support. Therefore, it's important to research available incentives before starting your company.
Seek Professional Support
It is important to seek professional support when establishing your company. A mistake can lead to significant problems in the future. It is advisable to seek assistance from experts at every step, from choosing the type of company to the articles of association.
Especially in the establishment of a limited company, a mistake in the agreement can lead to the need to repeat all transactions. In this case, the agreement may need to be rewritten, and you might have to make another appointment with the chamber of commerce. For error-free company establishment processes, contact our professional team.
Choosing the Invoice Type
After establishing your company, you need to determine which type of invoice you will use. Options include e-invoices, e-archive invoices, and paper invoices. As of 2022, all taxpayers with a gross sales revenue of 3 million TL or more are required to switch to e-invoicing starting in 2024. Additionally, certain sectors (e.g., e-commerce, real estate, motor vehicles) have also implemented mandatory e-invoicing for companies below certain revenue limits.
Selecting Personnel
If you are considering growing your business, you should be careful in your personnel selection. Hiring relatives or friends may seem appealing, but selecting unqualified individuals can complicate your business. Merit should always be your priority.
In this article, we have discussed the key topics to consider when starting a company in Turkey. If you have any further questions, please reach out to us. We are here to support you throughout the company establishment process and beyond.
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