Doing Business in Turkey Guide Novermber 2009 www.kapitalsmm.com

1. RSM International Executive Office
11 Old Jewry
London
EC2R 8DU
United Kingdom
T: +44 (0)20 7601 1080
F: +44 (0)20 7601 1090
E: rsmcommunications@rsmi.com
www.rsmi.com
The aim of this publication is to provide general information about doing business in Turkey and every effort has been made to
ensure the contents are accurate and current. However, tax rates, legislation and economic conditions referred to in this publication
are only accurate at time of writing. Information in this publication is in no way intended to replace or supersede independent or
other professional advice. Copies of this booklet or additional information can be obtained from the RSM International Executive
Office or Kapital Karden.
RSM International is the name given to a network of independent accounting and consulting firms each of which practices in its
own right. RSM International does not exist in any jurisdiction as a separate legal entity. The network is administered by RSM
International Limited, a company registered in England and Wales (company number 4040598) whose registered office is at 11 Old
Jewry, London EC2R 8DU. Intellectual property rights used by members of the network including the trademark RSM International
are owned by RSM International Association, an association governed by articles 60 et seq of the Civil Code of Switzerland whose
Doing business
seat is in Zug.
© RSM International Association, 2009 in Turkey

2. DOING BUSINESS IN TURKEY
Foreword
The Republic of Turkey’s standing as a cultural and geographic crossroads spanning
Europe, Asia, the Middle East, the Mediterranean and North Africa underscores the
country’s growing importance as an economic and geopolitical world power.
The large and growing domestic market, mature and dynamic private sector, its
leading role in the region, liberal and secure investment environment, supply of high
quality and cost-effective labor force, customs union with EU countries, developed
infrastructure, a growth economy and competitive tax system make Turkey an
attractive place to do business. Coupled with the traditional cornerstones of the
Turkish way of life, hospitality and tolerance, the country is open for business and
for foreign investors.
Business in Turkey is personal and often done with friends and relatives and those
whom are liked and trusted. So build friendships first, and expect to make long-term
relationships. A seemingly endless trail of tea and coffee cups will lead you to the
decision maker. Constantly pushing for yes or no answers does not bring results,
but talk football and doors will open. Most of all be patient and the rewards of doing
business in such an historically and culturally rich environment will be great.

3. Contents
7 About RSM International
8 General
10 Company Establishment Procedures
11 Types of Business Entities
13 Foreign Exchange Controls
14 Taxation
22 Employment
“In a world of different cultures, it’s good to have an advisor 22 Invoicing
who is consistent everyvhere.” 23 Expenses
25 Accounting
RSM International is seventh largest network of independent accounting and consulting firms worldwide. 26 Intellectual Property Rights
RSM is represented in over 70 countries and brings together the talents of 30,000 individuals. RSM firms
27 Investing in Turkey
are driven by a common vision of providing high quality professional services to ambitious and growing
30 Listing Rules in Turkey
organisations.
31 Relevant websites or further reading
32 About Kapital Karden

4. DOING BUSINESS IN TURKEY DOING BUSINESS IN TURKEY
About RSM International General
RSM International is a worldwide network of independent accounting and consulting The Republic of Turkey is a Eurasian transcontinental country that stretches from
firms. RSM International and its member firms are separate and independent legal Southern Europe to Western Asia. It borders eight nations, Bulgaria, Greece, Georgia,
entities. RSM International does not itself provide accounting or consultancy services. Armenia, Azerbaijan, Iran, Iraq and Syria. To the south is the Mediterranean Sea,
All such services are provided by affiliate members practising on their own account. to the west the Aegean Sea and the Black Sea to the north. The coastal areas of
Turkey in the south have a temperate Mediterranean climate, the central plateau of
RSM is represented by affiliate independent members in 76 countries and brings the interior has sharply contrasting seasons and in the west winter temperatures are
together the talents of over 30,000 individuals in 705 offices worldwide. cold and summers hot and dry. The time zone is GMT + 2 hours.
The network’s total fee income of US$3.8bn places it amongst the top seven Turkey is 37th largest country in the world with a territory of over 780,000 square
international accounting organisations worldwide. Affiliate member firms are driven kilometers subdivided into 81 provinces in seven regions. Ankara is the capital and
by a common vision of providing high quality professional services, both in their the largest city and its business heart is Istanbul with 13 million people. The total
domestic markets and in serving the international professional service needs of their population is nearly 75 million people and growing. Turkey is a democratic, secular,
client base. constitutional republic whose political system was established in 1923 by Mustafa
Kemal Ataturk, following the fall of the 500 year-old Ottoman Empire after World
RSM International is a member of the Forum of Firms. The objective of the Forum of
War I.
Firms is to promote consistent and high quality standards of financial and auditing
practices worldwide. The population is predominantly Muslim, the majority of whom are Sunni (80%)
with a large minority Alevi (20%). There are many minorities which follow other
RSM International
religions, mainly Christians, mostly Armenian Apostolic and Greek Orthodox and
Executive Office
Jews, mainly Sephardi. The official language is Turkish with a minority of Kurdish
11 Old Jewry
speakers. The free-floating national currency is the Turkish Lira (TL). Office hours
London EC2R 8DU
tend to be Monday to Friday, 9 – 6pm with workers working a 45 hour week. Public
United Kingdom
holidays of 14 days per year are a mix of secular and religious with the following
Telephone: + 44 (0)20 7601 1080
dates: January 1st New Year’s Day, April 23rd National Sovereignty and Children’s
Fax: + 44 (0)20 7601 1090
day, May 1st Labor and Solidarity Day, May 19th Commemoration of Ataturk Youth
Email: rsmcommunications@rsmi.com
and Sports Day, August 30th Victory Day, October 29th Republic Day. The following
Website: www.rsmi.com
religious holidays are observed: the three day Seker Bayram holiday after the month
of Ramadan, and four days of Kurban Bayram about two months later.
Turkey’s main industries are agricultural products, textiles, motor vehicles, transport
equipment, construction materials, consumer electronics, home appliances, mining,
steel, petroleum, lumber, and paper.
Turkey has the sixth largest economy in Europe (IMF April 2009) and the 5th largest
labor force. It is the 15th largest economy in the world with $915,184 million GDP.
Turkey is ranked the 15th most attractive destination for foreign direct investment
(FDI) in the world (UNCTAD World Investment Prospects Survey, 2008-2010). Turkey
stands to gain from the forthcoming liberalization of trade in the Euro-Mediterranean
Area which includes all 27 member states of the European Union, along with 16
partners across the Southern Mediterranean and the Middle East.

5. DOING BUSINESS IN TURKEY DOING BUSINESS IN TURKEY
Turkey’s population has an average age of 28.5 years old with 28% of the population Turkey’s 5th largest export market and reach $20 billion by 2011. Reconstruction,
under 14 years old and 64% are between 14 and 60 years old. In 2050 Turkey will hospitals, residence, infrastructure and superstructure in Iraq are opportunities for
have 25% of its population in the over 60 years-old group; a cushion against the the Turkish construction sector which is the 3rd largest in the world.
ageing demographic of other nations in Europe. The per capita GDP of $10,436 is
predicted to grow to $12,164 in 2011. Up to 2008 the GDP growth rate was 5% with a Energy is another massive growth sector with Turkey as a major energy hub with
contraction in 2009. However, Turkey is predicted to bounce back quicker than other an annual transit capacity of 221 million tons of oil and 43 billion M3 of natural gas.
economies and forecasts growth of 4.5% by 2011. Turkey is also a leader in producing high standard Voluntary Emission Reductions
(VERs) from renewable energy projects and has ratified the Kyoto Protocol in 2009.
Service industries make up half of the employment by economic activity followed by Voluntary carbon trading projects in Turkey have increased rapidly, reaching 45 from
agriculture (34.9%), industry (18.5%) and construction (4.5%). From 1995 to 2001 30 in the first quarter of 2008.
inflation soared at over 70%, this was reduced to 13% in 2002-2008 period and
stands at 5.33% in August 2009. In 2008 and 2009 over 26 million tourists visited Turkey and the country ranked 7th
most visited holiday destination in the world and 9th in terms of revenue from the
Since 2002, after the Banks’ Financial Crisis of Turkey, structural reforms aimed tourism sector. The Government’s target is 30 million visitors in 2010.
at increasing the role of the private sector in the Turkish economy, enhancing the
efficiency and resiliency of the financial sector and putting social security system on Turkey has 12 Free Trade Agreements with Albania, Bosnia and Herzegovina, Croatia,
a more sound footing have been made. The Turkish banking sector, with its strong EFTA member countries (Iceland, Norway, Switzerland and Lichtenstein), Egypt,
capital base (around 18%) and effective risk management practices, is healthy and Georgia, Israel, Macedonia, Morocco, Palestine, Syria, Tunisia and is in talks with
profitable. With its prudent fiscal policy, Turkey has reduced its debt stocks, becoming the Faroe Islands, member countries of the Gulf Cooperation Council, Jordan and
one of the best performers among OECD economies and has been meeting the EU Lebanon.
Maastricht Criteria since 2004.
Since 1962, Turkey has been negotiating and signing agreements for the reciprocal
In fact, a monetary policy framework and notable structural reforms have helped promotion and protection of investments. Turkey has signed bilateral investment
to produce the best economic performance in Turkey’s modern history. However, treaties with 80 countries, including with the United States, United Kingdom,
according to the IMF, further structural reforms, the informality of its business sector, Germany, the Netherlands, Belgium, Luxembourg, Denmark, Austria, Sweden,
youth unemployment and regional disparities are just some of the challenges it Switzerland, Spain, Finland, Italy, Portugal, Hungary, Poland, Romania, Tunisia,
faces. Kuwait, Bangladesh, China, Japan, South Korea, Indonesia, Croatia, Cuba, the Czech
Republic, Estonia, Russian Federation, Azerbaijan, Kazakhstan, Georgia, Tajikistan,
Foreign trade, both in exports and imports, has grown rapidly and industrial products Ukraine, Uzbekistan, Belarus, Lithuania, Latvia, Slovakia, Macedonia, Pakistan,
have now overtaken the predominant role of agricultural products. Turkey became Turkmenistan, Moldova, Kyrgyzstan, Albania, Bulgaria, Argentina, Bosnia, Malaysia,
a member of the World Trade Organization (WTO) in 1995. Following and agreed a Egypt, Mongolia, Greece, Israel, Afghanistan, Ethiopia, Iran, Lebanon, Syria, Slovenia,
Customs Union with the European Union on January 1, 1996. In 2008, the share of Jordan, and India. Turkey has avoidance of double taxation agreements with 71
the European Union member countries in overall Turkish exports was around 50%. countries.
Between 2002 and 2008, Turkey’s exports to the member countries of the Black Sea
Economic Cooperation (BSEC), the Organization of Islamic Conference (OIC) and the In the World Bank’s 2009 “Ease of Doing Business” table Turkey ranks 59 out of 181
Commonwealth of Independent States (CIS) increased, and the total export value economies.
reached $67 billion with a share of 51% in 2008.
Turkey’s export markets are highly diversified. In 2008, Germany, with its share
Company Establishment Procedures
of 9.8%, continued to be the largest export market for Turkish products. Turkey’s
second largest export market was the United Kingdom, with a share of 6.2%, and No pre-establishment permits are required. The company gets its ‘legal entity’ upon
the UAE, with its share of 6.0%, was the third largest market for Turkish export registration at the Trade Registry. For a simple limited company it takes one day.
products. Italy, France, the Russian Federation, the USA and Spain have been other
major export markets. As the UN embargo on trade with Iraq was lifted in May 2003, Applicants should check with a Trade Registry Office to find out if their trade names
Turkey realized USD 4 billion of exports to Iraq in 2008, with a share of 3% in total have already been registered. The trade name must be in Turkish and not include any
exports, and Iraq has been Turkey’s 10th major export partner. It will soon become sensitive words or expressions.
10

6. DOING BUSINESS IN TURKEY DOING BUSINESS IN TURKEY
The steps to establish a company are to prepare and notarize the Articles of Joint Stock Companies - Anonim Sirket (A.S)
Association, deposit 0.04% of the capital at the Central Bank, register the company
The company’s stock capital is divided into shares and the liability of the shareholders
at Trade Registry Office and Chamber of Commerce. Thereafter the Articles of
is limited to the capital subscribed and paid by the shareholder. At least five
Association are published in the Trade Registry Gazette. Once established the
shareholders real persons or entities. Minimum capital of 50,000TL. The company
Company must be registered at tax the office and receive its tax plate which must be
must declare a general assembly, a board of directors with at least three members
clearly displayed at the place of business. A tax inspector will make a visit to verify
and a supervisory board. The Articles of Association can declare the voting rights
it and the place of business within a few days of incorporation. The Registry Office
of the shareholders to limit the power of the majority shareholder. Banks, private
also notifies the Ministry of Labor and Social Security of the incorporation and both
finance institutions, insurance companies, financial leasing companies, factoring
the company and its employees must be registered with that administration. The
companies, holding companies, companies operating as foreign currency exchange
Registered address of the Company must be stated in the Articles of Association,
offices, companies dealing with public warehousing, publicly held companies subject
and any changes must be registered. The legal books of the company – the Journal,
to the Capital Markets Law, companies that are founders and operators of free zones
Ledger, Case book and Inventory book, must be certified by a notary on the day the
should be established as Joint Stock Associations and these companies are subject
company is registered.
to permit from Ministry of Industry and Trade.
If all company capital is not paid in advance, 25% of the initial capital must be
deposited within three months of company incorporation, and the balance of the Partnership Commandite Companies - Komandit Sirketi
subscribed capital must be paid within three years of incorporation. The capital can In this form of business company, some of the partners are liable for the association’s
be used immediately. The transfer of capital from abroad must be clearly marked as debts in the amount of capital which they contributed, while the other partners
‘Capital Transfer’. Incorporation and pre-operating expenses are deductible. have unlimited liability. No minimum capital is required. The relationship between
share holders is designated in the Articles of Association. In an Adi Komandit those
Regulated sectors such as Banks, Private Finance Institutions, Insurance, Financial partners with unlimited liability are called ‘active partners’ (commandite) and those
Leasing, Factoring, Holdings, Foreign Currency Exchange Offices, Public Warehousing, with limited liability ‘silent partners’ (commanditer). There are two types of Komandit
founders and operators of Free Trade Zones and companies are subject to the Capital Sirket: Adi Komandit Sirket where there is no corporate taxation, only the partners
Markets Law and must register with The Ministry of Commerce and Industry. These pay personal income tax on their income; and Eshamli Komandit Sirket which has
entities are also subject to an Independent Audit. corporate taxation on the ‘silent partners’ share. These partners pay personal income
tax on their income.
Types of Business Entities Partnership Collective Companies – Kollektif Sirketi
This is an association which has been established with the purpose of engaging in
The main company types in Turkey are Limited companies, Joint Stock companies commercial activities under a common trade name. Its most important characteristic
and partnerships of commandite and collective companies. Sole proprietors can be is the unlimited liability of the partners for the debt of the association. No minimum
established. All business are can be 100% foreign owned. Foreign businesses can capital is required. It is mandatory that all share holders should be real persons.
also open a Liaison Office or a Branch Office in Turkey. Participation to a previously
established company can be done in two ways, through either share transfer or Co-operative Association
contribution to the companies’ capital increase.
This is a business association established by persons who want jointly to supply goods
and services connected to their professions, crafts, and livelihoods. Arrangements
Limited Companies - Limited Sirket (Ltd. Sti) related to co-operative associations are governed by the Co-operatives Law.
A Limited Company is set up with at least two real persons or legal entities up to
50 maximum. The liability of the shareholders is limited with the share capital. Branch Offices of Foreign Companies – Sube
Minimum capital requirement is 5,000 TL. No stock certificate is issued. Decisions
Companies based abroad whose capital is divided into shares can open branches in
such as a capital increase, dividend distribution, appointing a local manager and
Turkey. Opening a Branch requires prior approval from the Ministry of Industry and
exit strategy are required to be taken by a majority of shareholders not by the size
Commerce. Liability lies with the Parent Company. The process to open a branch is
of the shareholding. Therefore, if there are only two shareholders, their availability
longer and more expensive than a simple limited company.
is limited or disagreements arise then no decision can be taken. Four shareholders
would be more effective.
11 12

7. DOING BUSINESS IN TURKEY DOING BUSINESS IN TURKEY
Liaison Offices - Irtibat Burosu Taxation
Special permission can be granted by the Directorate General of Foreign Investments
for Liaison Office status. The office cannot issue invoices or generate revenue but
solely acts as a sales and marketing office. Orders for goods are placed with the Taxes are levied on income both personal and corporate, on property and motor
related entity abroad. Liaison offices have all their expenses such as rental, utilities, vehicles. Taxes are levied on expenditures and include Value Added Tax, Excise Duty,
car leasing met from abroad. The liaison office permission is renewable on application Customs Duty, Banking and Insurance Transactions Tax, Special Communications
every three years. An annual statement is sent to the Foreign Ministry to show all Tax, Stamp Duty and Fees Tax. Other Taxes are Announcement and Advertisement
expenditures have been met by the foreign capital. Liaison office employees receive Tax, Entertainment Tax, Communications Tax, Electricity and Gas Consumption Tax
their salary in foreign currency sent from abroad and are not liable to income tax. and Environmental Consumption Tax.
The employer is liable to meet the social security costs of those liable employees in
There is a special taxation method for multi-year construction and repair works
Turkey. However, many foreign nationals working in Turkey can apply for exemption
that allow for the final determination of the profit and loss in the year in which the
if they continue to pay social insurance in their home country. Turkey has such
work ends, and declared in the tax return for that year. A withholding tax is levied
agreements with 22 countries.
on progress payments and when the total offset is greater than the taxes that are
calculated the outstanding difference is refunded to the tax payer. However, the
Holding Companies receivables of the taxpayers who don’t submit an application within one year become
Holding Companies, whose main purpose is to participate in enterprises, may provide null.
a variety of services to their subsidiaries, in such areas as research development,
procurement of finance, marketing and distribution, preparation of investment Consolidation for tax purposes is not allowed. Each entity is subject to tax on a stand-
projects, determination of objectives, planning, organization, implementation of alone basis.
decisions, computer services, management, financial revision and tax consulting,
market research, public relations, recruitment and training of personnel, accounting Corporate Income Tax
organization and control and legal consulting. Providing that the services are Corporation Tax Annual Returns are generally filed between 1st and 25th April.
physically rendered, described in detail on the invoice and the price of each service
disclosed separately. If those conditions are met then the subsidiaries are allowed to Advance Corporate Income Tax returns are filed by the 10th and paid by the 17th of
show the totals invoiced by the Holding Company as an expense. the second month after each quarter. Corporate income tax rate 20%
Closing a business Corporate Income Tax Structure
Liquidation requires the appointment of a clerk who will be responsible for closing Example of calculation effective tax burden
the business and, if there are no legal or tax issues, this may take up to 13 months.
Corporate Income 100
Corporate Tax 20% -20
Foreign Exchange Controls After-tax income 80
Distributable profit 80
Turkish law guarantees the free transfer of profits, fees, and royalties, and
Dividend WHT 15% -12
repatriation of capital. There is no difficulty in obtaining foreign exchange, and there
Net Dividend 68
are no foreign exchange restrictions except in some circumstances connected to oil
Effective Tax Burden 32%
and gas exploration.
Payroll Taxes / Costs
Social Security is totally 33.5% of gross salary. The employer contribution is 19.5%
and employee contribution 14%. Unemployment Fund contributions are 2% from
employer and 1% from employee based on the gross salary, with an annual upper
13 1

8. DOING BUSINESS IN TURKEY DOING BUSINESS IN TURKEY
limit. A Payroll Stamp Tax of 0.6% based on the gross salary is paid by employee. 2009 Personal Progressive Income Tax Rate
Premiums paid by an employee for personal insurance should not exceed 5% of the
wage that month and premiums, membership fees and contribution shares not to 15% for income between 0 – 8,700 TL
exceed 10%. Wages paid in foreign currency are converted at the market rate on 20% for income between 8,701 – 22,000 TL
the date of payment. The employer pays these taxes to tax office on behalf of the 27% for income between 22,001 – 50,000 TL
employee by 20th of the following month. 35% for income of 50,001 TL and over
Cost to Employer Chart Annual Personal Income Tax return filed by the 31st March of the year following the
Net Minimum Monthly Wage $358 end of the tax year on 31st December. Self-employed people make advance payments
Gross Minimum Wage $453 4 times in each year at a standard rate of 15% of the net profit.
Employee Deduction Payments such as severance payments in Turkey and retirement pension paid by
Social Security Premium (14%) $6 social security institutions located in foreign countries, as well as lump sum payments
Unemployment Fund (1%) $5 to surviving spouses are excluded from assessment Indemnity and Assistance for
Income tax (15%) $58 income tax.
Minimum living allowance $-33
Mass transit in shuttle vehicles for employees from and to their place is excluded
Stamp tax (0.6%) $3
from income tax but vehicles for upper level employees used exclusively as a private
Total deduction $96
official car will be treated as wage payment. Providing there is a ‘contract’ between
Cost for Employer employer and employee, the expenses incurred using the employee’s personal car
Gross minimum wage $453 for business purposes can be deducted; as are the expenses in leasing a car in the
Employer’s share of social security premium (19.5%) $88 name of the enterprise for the employee’s use and they are expenses in leasing a
Employer’s payment into unemployment insurance fund (2%) $9 car in the name of the enterprise for the employee’s use and they are not treated as
Total Cost for Employer $55 taxable income.
Value Added Tax
Source: Ministry of Labor and Social Security of the Republic of Turkey
VAT Rates are from 1% for certain agricultural products, 8% for basic foodstuff,
Valid for the second half of 2009 textile products etc. and a general rate of 18%. VAT returns are submitted monthly
For single individuals without children and may vary according to marital status and number by the 20th of the following month and paid by the 26th.
of children.
USD 1 = TRY 1.53 as of June 2009 Deliveries and services, importation of goods and services, communications services
including radio and television, games of chance, professional concerts and sports
Personal Income Tax competitions, auctions, movement of energy through pipelines, delivery and
‘Resident tax payers’, who have their legal residence in Turkey and who reside importation of ornaments and coins that contain gold, property rental are liable
in Turkey for a continuous period of more than six months within one calendar to VAT. Non residence does not change the nature of these transactions. Goods
year, are considered to be settled in Turkey and are taxed over their earnings and are liable at the moment of delivery, and services from the performance, benefit or
revenues in Turkey and abroad. Businessmen, scientists, experts, officials, press valuation of these services in Turkey.
correspondents, and other individuals whose situations resemble these, as well as
Where the taxpayer has no legal residence, place of business, the Ministry of Finance
those who have arrived for purposes of education, or of medical treatment, shall
holds the taxpayer in Turkey responsible for the transaction. The main purpose is to
not be considered settled in Turkey, even if they have remained for more than
secure the collection of the tax receivable. VAT has to be recorded in the legal books
six months in the country. Therefore, they are considered as ‘limited liability tax
and documents.
payers’ and are taxed solely on their income acquired in Turkey.
VAT Deduction Mechanism
VAT payable on local purchases and on imports is regarded as “input VAT” and VAT
calculated and collected on sales is considered as “output VAT”. Input VAT is offset
15 16

9. DOING BUSINESS IN TURKEY DOING BUSINESS IN TURKEY
against output VAT in the VAT return filed at the related tax office by the 20th of the Credit charges, price differentials, interest and premiums, even if disclosed separately
following month. If output VAT is in excess of input VAT, the excess amount is paid to to the invoice, are included in the tax base.
the related tax office. However, if input VAT exceeds the output VAT, the balance is
carried forward to the following months to be offset against future output VAT. There Where the cost has been quoted or indexed in foreign currency the foreign gains
is no cash refund to recover excess input VAT, except for exportation. accrued in favour of the supplier are taxed as component of the tax base. In the
case of the foreign exchange gain in favour of the buyer, an invoice should be drawn
There is also a reverse charge VAT mechanism, which requires the calculation of up by the buyer to the supplier covering the amount of foreign exchange gain that
VAT by resident companies on payments sent abroad. Under this mechanism, VAT has been accrued. VAT is applied as of the date which the goods or services were
is calculated and paid to the related tax office by the Turkish company on behalf of delivered.
the foreign company. The local company treats this VAT as input VAT and offsets it
in the same month. This VAT does not create a tax burden for the Turkish and the In the case of the return of the goods or non performance of the service the taxpayer
non-resident company, except for its cash flow effect. subject to taxation can correct and deduct the tax during the period in which the
change occurred.
Export exemption for VAT
To recognize an export delivery it must be made to a customer abroad, to a free VAT for Partnerships
zone, or bonded warehouse, it must cross the Customs Line of the Republic of Turkey Ordinary partnerships have a separate tax payer status but are required to keep
and arrive in a foreign country. A service must have been performed for a customer legal books, file tax returns and pay taxes separately from its partners. Transfers
abroad and the benefit derived abroad. of shares when they do not result in the termination of the partnership are exempt
from VAT. Although the VAT return isdrawn up in the name of the partnership and
Non-residents can reclaim VAT for goods they purchase to take out of Turkey by signed and filed by one of the shareholders, all shareholders are jointly responsible
presenting the invoice or sales document at the point the goods pass through for the payment of the tax. A list is attached with the names, addresses and the tax
customs. offices of the partners.
Goods and services purchased in connection with transport activities, participation VAT on Sales of Shares
in fairs, markets or exhibitions are refunded on the principle of reciprocity.
Sales of shares in an Joint Stock company (Anonim Sirket A.S) are exempt from VAT.
VAT on goods delivered by manufacturers to exporters for subsequent export are not A sale of shares in a Limited company (Ltd. Sti.) by another company is exempted
paid by the exporter. This tax, which is not collected from the taxpayer, is declared from VAT, if the participation is held for at least two years. A sale of shares by an
on the tax return, assessed, accrued and deferred. If the goods are exported within individual is not subject to VAT.
three months (or extension period of upto three months) the deferred tax is written
off. If the export is not made, the deferred tax plus a delay surcharge is assessed. Withholding Tax
The VAT to be refunded to the manufacturer is paid following the completion of the Certain taxes are collected through withholding by the taxpayers in order to secure
export. the collection of taxes. These include income tax on salaries of employees, lease
payments to individual landlords, independent professional service fee payments to
Import VAT resident individuals, and royalty, licence and service fee payments to nonresidents.
The tax base is the total value of the following elements: the value of the imported Companies in Turkey are responsible to withhold such taxes on their payments and
article used for the assessment of customs duty or if the item is exempt then the declare them through their withholding tax returns.
value including insurance and freight charges (CIF); all taxes, duties, expenditures,
Filed by the 20th day and paid on the 26th of the following month. Companies with
and charges paid during importation; other expenditures such as price differentials
less than 10 employees can apply to file quarterly.
and foreign exchange rate differentials based on the value of the article.
Tax Base for VAT Tax withholding on dividends distributed by corporations
Withholding tax of 15% is applied on the dividends distributed by resident taxpayers to
In order for discounts to be excluded from the tax base they should be disclosed on
resident and non-resident real persons and non-resident corporations. Declarations
the invoice or documentation, at that time, and conform with commercial practices.
are filed by the 20th day and tax paid by the 26th of the month following the dividend
distribution.
1 1

10. DOING BUSINESS IN TURKEY DOING BUSINESS IN TURKEY
Royalties, management fees, technical assistance fees and similar professional service
Special There are different product groups that are subject to OTV
fees paid to a non-resident are normally subject to withholding tax at source at 20
Consumption Tax at different tax rates:
percent, unless a tax treaty provides relief. Dividends paid by a resident corporation
to another resident corporation (or to a Turkish branch of a foreign corporation) are (OTV) 1. Petroleum products, natural gas, lubricating oil,
not subject to dividend withholding tax. solvents and derivatives of solvents
Some types of payments to entities in low tax jurisdictions have a 30 percent 2. Automobiles and other vehicles, motorcycles, planes,
withholding tax in line with anti avoidance rules. helicopters, yachts
3. Tobacco and tobacco products, alcoholic beverages
Other Taxes 4. Luxury products
Environment Tax Environment tax 1,537TL plus 25% surcharge in Istanbul
levied by the Municipalities towards the financing of certain
Bank Taxes Withholding Tax on interest 15% services such as garbage collection. This tax is paid via the
Transaction tax on checks 1.6 TL per check water bill of the property.
Also Banking and Insurance company transactions remain
Advertising Tax Advertising tax at various rates especially for alcohol and
exempt from VAT, but are subject to a Banking and tobacco advertising
Insurance Transaction Tax (BITT) of 5%.
Vehicle Taxes Fuel tax included in fuel price
The amount of Motor Vehicle Tax for land transportation Filing Periods
vehicles is determined according to their weight, age,
cylinder capacity.
Corporate income If filing by calendar year financial statements due by April 25
Property Tax Property transfer fee 1.5% based on sale price
tax - late filing subject to a fine.
Property tax 0.2% and 0.3% (double in Istanbul) value of
building and land Advance corporate Filed by the 10th and paid by the 17th of the second month
Stamp duty on property sale 0.8% income tax after each quarter.
Stamp Tax Some documents prepared in Turkey (contracts, share Withholding tax Filed by the 20th day and paid on the 26th of the following
purchase agreements, loan contracts, and mortgage month. Companies with less than 10 employee scan apply to
instruments, etc.) are subject to stamp duties, typically at file quarterly.
0.75% based on transaction value. Loan contracts (and
VAT Filed monthly by the 20th of the following month and paid
security documents, such as a mortgage) for a loan from by the 26th.
a local or foreign bank are exempt from the stamp duty.
Merger agreements (taxable or tax-free mergers or tax- Personal income Annual return filed by March 25 of the year following the end
tax of the tax year on December 31. Payment at the end of March
free divisions) are not subject to stamp duties. Stamp tax
and June.
payments are recorded in a ledger and declared periodically.
Stamp Tax is payable by the parties who sign a document.
Each and every signed copy of the agreement is separately Other Tax Issues
subject to Stamp Tax.
Related Party Definition
For the Income Tax Code spouses, relatives by ancestry or descent up to and
including third degree relations by blood or marriage, and parties under control from
the standpoint of management, supervision and capital are considered as related
parties. For debt as disguised equity a related party is legal or real persons who
have at least 10 percent shareholding or control of those companies owned by the
shareholders.
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11. DOING BUSINESS IN TURKEY DOING BUSINESS IN TURKEY
Transfer Pricing The corporation tax base is assessed from the sum of the revenue multiplied by the
arm’s length ratios - land: 12%, sea: 15%, air: 5% e.g. Revenue of 150,000 x Sea
Transfer pricing regulations are based on the OECD guidelines and were introduced
Ratio 15% = 22,500 TL
in 2006.
CIT Base 22,500 TL x Tax Rate of 20% = 4,500 TL. A tax withholding will be applied
Disguised profit distribution through Transfer Pricing on the portion of the gain transferred to the head office: 22,500 – 4,500= 18,000 x
The four significant concepts are: if the person or entity is engaged in buying goods 15% = 2,700 TL.
and services; from related parties; at prices or amounts that do not conform to ‘arm’s
length’ or market value principles; and as determined by the Ministry of Finance.
Taxpayers are allowed to chose from: Comparable Price Method; Cost Plus Method
Offset Losses
with the cost of the goods or services increased by a ‘reasonable gross profit ratio’; Losses can be carried forward five years. No carry back is possible.
and Resale Price Method.
Employment
Thin Capitalisation
Debt is reclassified as disguised equity, for tax purposes only, if all of the following Employment is covered by Labor Law 4857. Under its terms there is no
tests are met: The lender is a related party and the debt-to-equity ratio exceeds three discrimination based on language, race, sex, political opinion, philosophical belief,
times the shareholders equity of the company at any time during the year. The ratio religion or similar reasons. The minimum hourly wage for all employees over 16
can be increased to six times of the shareholders equity, if the shareholder/related years of age in Turkey in 2009 is 693 TL per month.
party providing the loan is a genuine financial institution. The effect of the thin-
capitalization rules is that financial expenses such as interest expenses and foreign Turkey has signed many International Labor Organization (ILO) conventions
exchange losses associated with the amount in excess of a three-to-one debt equity protecting workers’ rights. Turkey’s labor force has a reputation for being
ratio is disallowed for tax purposes. hardworking, productive, and dependable.
Foreigners employed legally in Turkey can either apply for Work Permits from the
Intangible Rights and Disguised Profit Distribution Ministry of Labor and Social Security or from the Consulates and Embassies of the
The arm’s length value should be the price that the owner of an intangible asset Turkish Republic abroad. Many visitors can buy a sticker visa on arrival and stay
would agree to transfer the right to a third party in an uncontrolled transaction. between 30 to 90 days, some passport holders have to apply in advance for a visa.
Please check with the Ministry of Foreign Affairs.
Works undertaken as an Ordinary Partnership / Joint Venture /
Turkey has signed Social Security Agreements with 22 countries: Albania, Austria,
Consortium Azerbaijan, Belgium, Bosnia and Herzegovina, Bulgaria, Canada and the Province of
Ordinary Partnerships do not have corporation tax liability and its partners are Quebec, Czech Republic, Denmark, France, Georgia, Germany, Libya, Luxembourg,
separately registered as liable for income tax or corporation tax. Joint Ventures are Macedonia, Norway, Romania, Sweden, Switzerland, Turkish Republic of Northern
liable for corporation tax. Cyprus, The Netherlands, The United Kingdom.
However, Consortiums are not clearly defined in the Turkish Tax Legislation, but
typically used for construction work with separable segments. Although one partner Invoicing
is the addressee of the tax office, each member accounts for its own income and
expenses and profit or loss per its own segment of the work. The consortium Fake invoices (‘naylan fatura’) are a common occurrence in Turkey. Often issued to
terminates on the completion of the work. raise the expenses and costs in order to show less profit, reduce the tax assessment
and avoid payment of VAT or to receive a VAT refund. Expenses that can’t be
Tax Assessment for Non-resident Foreign Transport Companies authenticated, such as the non-disclosure of employees’ actual wages, are often
declared at minimum wage levels.
Firms are taxed on revenue considered to have been generated in Turkey. For land
transport the passenger, cargo and baggage transport fees within the borders of
Turkey, sea and air transport fees from loading points in Turkey and commission on
tickets sold in Turkey are considered revenue.
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12. DOING BUSINESS IN TURKEY DOING BUSINESS IN TURKEY
All invoices must contain the following minimum information: the date, series and the enterprise are treated as wage expense and subject to withholding tax and are
sequence number, the name and commercial title of the business, the business treated as a benefit provided to employees.
address; the company’s registered tax office and account number; the customer’s
name, commercial title, address and its tax office and account number; the type, Expenditures incurred in tenders for construction work such as surveys, travel and
amount, price and total value of the goods or services; the date of delivery. A miscellaneous expenses incurred in connection with the tender guarantee and stamp
consignment invoice, which is a combination of invoice and waybill, is allowed but duties, even if the tender is not awarded, are deductible. However payments made
must be drawn up in at least three copies; with two copies accompanying the goods for purposes of persuading other parties to withdraw a tender cannot be accepted as
in the vehicle carrying the consignment. In the event of required information being deductible expense. Payments that are not legal are disallowable. Expenses related
missing the invoice is regarded as not having been issued at all. to attorneys and lawsuits may be treated as deductible unless the lawsuits have been
filed due to the personal fault of the enterprise.
Invoices are to be given consecutive sequence numbers; issued with at least one
original and one copy, more than copy is to be marked with its number; the signature Grants and donations to recognized foundations amounting to 5% of that year’s
(which can be printed) of the owner or authorized representative of the business and corporate earnings are deductible. Grants to educational and health facilities may be
company stamp should be at the top of the invoice. fully deductible as are donations made in cash or kind for national catastrophes.
Invoices have to be issued within ten days of the date of the delivery or performance Non-documented expenditures such as train, boat, bus and parking lot fees can be
of the service, otherwise they will be considered void. The customer is obliged to deducted with a detailed list of the date, amount and the name and location of the
present its documents for identity and tax office account number if requested by the related parties. Sales slips/receipts including VAT and not above 670TL, for goods
issuer of the invoice. such as stationery, office supplies, cleaning materials for use in the workplace can be
accepted as deductible expenses.
Invoices have to be printed by printers who have a special contract with the Ministry
of Finance. For tax purposes goods that are lost or stolen cannot be recorded as an expense.
Normal shrinkage and in the cases of a ‘force majeure’ the cost of the goods may be
There are penalties for failure to issue receipts and invoices. written as an expense.
Sponsorship expenses cannot be deducted unless the sponsor has generated profits
Expenses and then 100% can be deducted for amateur sports and 50% for professional sports
sponsorships.
Deductible Expenses Sales staff can be reimbursed for daily transports costs and also one employee such
as a messenger. Non sales staff cannot claim for a commuting allowance.
Expenses should be directly relevant to the acquisition and continuation of business
profits, that they are commensurate with the volume of the business. Some non Company Cars
deductible expenses include cell phones that are not recorded to the name of the
enterprise cannot be recorded as expense. If the company purchases cars for the employees’ use all expenses and depreciation
expenses are deductible.
For expense recognition of hospitality and entertainment, there should be business
relationship with the firm, the expenses in line with size of the business and expected Lease car hire costs for employees use are deductible. A contract is made between
outcome and should not breach public morality and laws. For business travel and the lease car supplier and the company is invoiced monthly with deductible VAT at
accommodation the ‘actual expense method’ or the ‘allowance method’ can be used. 18%. There is a 0.75% stamp tax payable by the company based on the total amount
Per Diem levels are set against those given to State civil servants with the same of the initial contract. You are required to have third party insurance and an optional
monthly salary, or the highest limit granted by the State. Allowances exceeding this comprehensive insurance. The employee signs a ‘consignment note’ to confirm
amount are subject to taxation as a wage payment. Recently, expense documents by receipt of the car, stating that the car will be used on company business. Expense
sales representatives abroad commensurate with the business have been recognized claims for fuel, road toll fees and parking are deductible and submitted on a monthly
as deductible expenses, even in cases where they are drawn up to the employee’s expense claim form with receipts or invoices addressed to the company - not in the
own name and not that of the firm. Medical services in private polyclinics paid by employee’s name. These are not payroll-related expenses and should be reimbursed
directly to the employee by the company’s accountant
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13. DOING BUSINESS IN TURKEY DOING BUSINESS IN TURKEY
If employees are using their own car for company business then there should be Treasury, Capital Markets Board and the Banking Regulation and Supervision Agency
a written ‘agreement’ between the employee and the employer about ‘leasing’ the are the bodies overseeing accounting rules. However, accounting regulations by the
employee’s car so that expenses such as petrol, road tolls and parking are deductible Ministry of Finance take precedence over all other regulations with limited exceptions
on a monthly expense claim form. If the annual amount paid to the employee is less for banks, insurance companies and listed companies. Therefore, these entities are
than 22,000 TL then this is not declared for personal income tax. However, the required to prepare multiple sets of financial statements from their single set of
employer has to deduct 20% withholding tax on the amount paid to the employee underlying accounting records. Traditionally many medium and large enterprises
for using their car and also offset the 18% VAT. base their management information on tax accounting, which does not provide
management with adequate information to manage their enterprises efficiently. The
If employees use their own cars occasionally for business purposes then they can be systems for internal controls are generally weak in Turkish enterprises.
reimbursed at approximately 0.60 to 0.80 TL per 1 km. This is based on a comparable
journey by state controlled taxi of 1.3 TL per km.
Legal Books
Accounting Although maintain the General Ledger is mandatory there is no requirement to have
it certified. However the following legal books need to be certified by a notary public:
IA Draft Commercial Code is making its way through the Parliament and is broadly Journal and Inventory Registers; Operation Registers; Farmer’s Operation Registers;
in line with Turkey’s accession targets for entry to the European Union. Under the Manufacturing and Production Tax Registers; Transportation Tax Registers; Foreign
Code all companies other than small and medium-sized entities (SMEs) present their Transport Proceeds Registers; Independent Professional Earnings Register.
legal and consolidated financial statements in accordance with Turkish Accounting
There is a special Irregularity Fine for the company’s failure to have the daily cash
Standards and which correspond to International Financial Reporting Standards
register, daily retail sales and proceeds register, and self-employment earnings
(IFRS) and that all companies have an annual audit by a licensed independent auditor
register at the place of business.
carried out in accordance with International Standards of Auditing (ISA).
The Turkish Accounting and Auditing Standards Board (TMUDESK), founded in Depreciation
1994, is a member of the International Accounting Standards Committee (IASC).
The standards issued by the Turkish Accounting and Auditing Standards Board are Depreciation is classified under four headings
parallel to and in conformity with the IFAC standards and may bear some minor
revisions. The Turkish Uniform Chart of Accounts was introduced 1 January 1994. (1) Straight Line Method (2) Double Declining Method for taxpayers who keep their
accounts on the balance sheet basis (3) Depreciation in Mines determined separately
All types of commercial companies which are subject to corporation tax are considered for each quarry (4) Extraordinary Economic and Technical Depreciation as determined
Class I Merchants and must maintain their books on a balance sheet basis. by the Ministry of Finance.
The statutory financial statements should include at least the following: Balance The foreign exchange buying rates announced by the Turkish Central bank are used
sheet, Profit and Loss Statement and Notes to the Financial Statements. to determine foreign exchange gains or losses on the cost of foreign loans.
Accountants are governed by Law Number 3568 and authorized by The Union of
Certified Public Accountants and Sworn-in Certified Public Accountants of Turkey Intellectual Property rights
(TURMOB). Certified Public Accountants are known as Serbest Muhasebeci Mali
Musavirlik (SMMM) and Sworn-in Certified Public Accountants known as Yeminili Mali
Musavir (YMM), the latter having at least 10 years work experience as a Certified Turkey’s legal system provides means for enforcing property and contractual rights,
Public Accountant. They are authorised to approve financial and tax statements with and there are written commercial and bankruptcy laws.
an authority similar to public officials of the Revenues Directorate of the Ministry of
Turkish law generally accepts binding international arbitration of investment disputes
Finance.
between foreign investors and the state. Secured interests in property, both movable
The Turkish Accounting Standards Board, Turkish Auditing Standards Board, Revenues and real, are recognized and enforced. Real estate is registered at the land registry
Administration, the General Directorate of Insurance of the Under Secretariat of office.
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14. DOING BUSINESS IN TURKEY DOING BUSINESS IN TURKEY
Turkey’s copyright law provides deterrent penalties for copyright infringement. The agriculture, food, infrastructure, energy and real estate sectors are expected to
law contains several strong anti-piracy provisions, including a ban on street sales of receive substantial investments.
all copyrighted products and authorization to take action without a complaint by the
rights holder. Although pirated materials are still common, the law has minimum The Investment Incentive System in Turkey
penalties of three months to two years imprisonment and/or a fine between 5,000 Investment Incentive schemes are: General investment incentive regime; Incentives
and 50,000 TL and a maximum penalty of three to six years imprisonment and/or for large-scale investments; Region and sector-based incentive system; Incentives
fines between 50,000 and 250,000 TL. on employment; RD support; SMEs; Industrial Thesis (SANTEZ) program; Loans for
technical development projects; Training supports and State aids for exports. The
Turkey is a signatory to a number of international conventions, including the general investment incentive regime is mainly a tax benefit program, in some cases
Stockholm Act of the Paris Convention, the Patent Cooperation Treaty, the Strasbourg with credit possibilities. The implementation of the Turkish incentive regime varies
Agreement, and the WIPO Copyright Agreement and Performances and Phonograms depending on the location, scale and subject of investments. The major incentives
Treaty. instruments are exemption from customs duties for imported machinery and
equipment for projects with an incentive certificate and VAT exemption for locally
Turkey’s Patent Law provides for penalties for infringement of up to 4 years in prison,
purchased or imported machinery and equipment for projects with an incentive
or 46,000 TL in fines, or both, closure of the business for at least one year, and a
certificate.
prohibition on the owner’s participation in any commercial activity during that same
period. There are also incentives for large scale investments such as: Corporate Tax rates
between 2-10% for investments started before 31st December 2010 and between 4-
Trademark holders have reported counterfeiting of their marks in Turkey, especially in
15% for investments from 2011; Social Security premium contribution for employers
apparel, film, cosmetics, detergent and pharmaceuticals. Turkey provides protection
up to 7 years; and free land allocation.
for commercial seed under its Plant Variety Protection (PVP) Law.
Large scale investments in the following sectors and investment amounts qualify for
Investing in Turkey an Incentive Certificate: raw chemical materials production and in the oil industry
for over 1 billion TL investment; 300 million TL in other chemical production; transit
pipeline services totaling a minimum of 50 million TL investment; automotive
The foreign investment legislation is based on the principle of equal treatment for investments over 250 million TL; Railways over 50 million TL; Ports over 250 million
the domestic and foreign investors. TL; Electronics investments in LCD/Plasma screen manufacturing totaling a minimum
of 1 billion TL and other electronics sector investments, including information and
In 2006, 2007 and 2008 Turkey attracted almost $20 billion a year in For eign Direct communication technologies, totaling a minimum of 50 million TL; Medical and optic
investment. In the first half of 2009 there was a reduced inflow of $3.5 billion with a devices over 50 million TL; Pharmaceuticals over 100 million TL; Aviation industry
third going to electricity, gas and water supply. USD 9 – 10 billion worth of investment minimum of 50 million TL; Machinery minimum of 50 million TL; Mining investments
is predicted for 2009. Historically Turkey has attracted the highest amount of FDI in ore processing facilities and integrated metals production mills totaling a minimum
from EU member countries, Gulf Arab countries and the USA. China, Korea and India of 50 million TL.
are expected to make significant investments.
Region and sector-based incentives offer the same incentives as above. They are
In 2009 there were 22,250 companies with international capital operating in Turkey, based on zones. In Zone 1: Investments that generally require the use of advanced
the majority in the wholesale and retail trade sectors, followed by manufacturing technology, such as the automotive and supply industry, electronics, pharmaceuticals,
in textile goods, chemical products, food beverage products and then real estate machinery, medical and optical devices will be covered by incentives. In Zone 2:
and construction. Half the companies with foreign capital are of EU origin – led by Technology-intensive sectors will be supported. In this framework, machinery, smart
Germany with 3,806 companies, UK with 2,110 and Netherlands with 1721 companies. multi-functional textile, non-metal mineral product, paper, and food beverage
12,172 companies are based in Istanbul followed by Antalya (2,827), Ankara (1471) and investments will be incentivized. In Zones 3 and 4: Investments in agriculture,
Izmir 1,300 agriculture-based manufacturing industry, ready-to-wear, plastics, rubber, metal
goods, tourism, health and education will be covered by incentives. Some additional
66 Incentive Certificates issued by the Undersecretariat of Treasury for the first five
sectors will be incentivized regardless of location: Specialized Organized Industrial
months of 2009 with a capital value of $3.3 billion, half of this capital will be covered
Zones (OIZ) established by the Ministry of Industry and Commerce; Investments
by international partners and mainly in the manufacturing and services sector. The
related to the transportation of cargo and/or passengers by sea; Railway investments
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15. DOING BUSINESS IN TURKEY DOING BUSINESS IN TURKEY
by the private sector for inter-city cargo and/or passenger transportation, as well An Industrial Thesis (SANTEZ) program offers direct financial support for new
as railway investments for local cargo transportation are subject to incentives in all technology adaptation, process development, quality improvement and environmental
regions; Housing heating/cooling investments, realized through geothermal energy modification projects to be realized with university partnerships.
and/or power plant waste energy, may benefit from regional incentives.
The Technology Development Foundation of Turkey (TTGV) presents long term
There are Employment Incentives for newly employed women and unemployed interest-free loans for technology development, renewable energy production, energy
people between the ages of 18 and 29 recruited before July 1st, 2010 and incentives efficiency improvement and environmental impact-reducing projects. Exemplary
for additional employment. support for environmental project with the maximum contribution rate is 50% per
project; a maximum budget of USD 1 million per project; and the pay-back period is 4
Research and Development Incentives apply for projects in Turkey if a minimum of years after the project execution.
50 personnel are employed in an RD center. The incentives within the new law are
valid until the year 2024 and include; 100% deduction of RD expenditures from the
tax base if the number of researchers is over 500; Income withholding tax exemption Listing Rules in Turkey
for the employees (this item will be effective until December 31st, 2013; 50% of social
security premium exemption for employees for a period of 5 years; Stamp duty
The Istanbul Stock Exchange (ISE), 1986, is becoming a significant emerging market
exemption for applicable documents; Techno-initiative capital for new scientists up
stock exchange. In 2009 there are 320 national companies listed on the exchange.
to 100,000 TL; Deduction from the tax base of certain funds granted by public bodies
The Market value at the Istanbul Stock Exchange is over 300 billion TL. Akbank is
and international organizations.
the stock exchange’s most valuable company with a 24.4 billion TL market value.
Six out of the top 10 most valuable companies are banks, namely Garanti Bank, Is
With the establishment of Technology Development Zones (TDZ) companies are
Bankasi, Yapi Kredi, Halkbank and Finans Bank. However, Turkey has yet to develop
provided with offices ready to rent, and infrastructure facilities are provided; Profits
other capital markets. The Capital Markets Board is responsible for overseeing
derived from software development and RD activities are exempt from income
the activities of capital markets, including activities of ISE-quoted companies, and
and corporate taxes until 31.12.2013; Deliveries of application software produced
securities and investment houses. The Turkish private sector is dominated by a
exclusively in TDZs are exempt from VAT until 31.12.2013; Wages of researchers along
number of large holding companies, whose upper management is family-controlled.
with software and RD personnel employed in the zone are exempt from personal
Most large businesses continue to float publicly only a minority portion of company
income tax until 31.12.2013; and 50% of the employer’s share of the social security
shares in order to limit outside interference in company management. There has
premium will be paid by the government for 5 years until 31st December 2024.
been no attempt at a hostile takeover by either international or domestic parties in
TUBITAK (Scientific and Technological Research Council of Turkey) and TTGV (Turkish recent memory. Capital market instruments are still developing in Turkey. Turkey’s
Technology Development Foundation) both compensate or grant RD related first mortgage law was adopted in 2007. Hedging instruments are also very limited.
expenses and capital loans for RD projects. Izmir’s futures market opened in 2003 and has recorded monthly transaction
volumes of around $12 billion.
Small and Medium Enterprises (SMEs) operating in the manufacturing, agro-industry,
tourism, education and healthcare, mining, and software development industries, An independent Banking and Regulation Supervision Agency (BRSA) monitors and
employing less than 250 employees and earning less than 25 million TL in revenue supervises Turkey’s banks. The BRSA is headed by a board whose seven members
or turnover per year can apply for incentives: Exemption from custom duties; VAT are appointed by the cabinet for six-year terms. In addition, bank deposits are
exemption for imported and domestically purchased machinery and equipment; protected by an independent deposit insurance agency, the State Deposit Insurance
Credit allocation; and New credit guarantee support. The Turkish Treasury announced Fund (SDIF).
the establishment of a new guarantee program with a 1 billion TL fund transferred to
the Credit Guarantee Fund (KGF) to create credit capacity worth TRY 10 billion. The
Treasury will also guarantee a 65% share of these credits. The Small and Medium
Sized Industry Development Organization (KOSGEB) contributes to strengthening
SMEs by various support instruments in financing, RD, common facilities, market
research, investment site, marketing, export and training.
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16. DOING BUSINESS IN TURKEY DOING BUSINESS IN TURKEY
Relevant websites or further reading About Kapital Karden
www.invest.gov.tr Investment Support and Promotion Agencywww.treasury Kapital Karden is a financially-focused, professional business services provider that
www.gov.tr The Turkish Treasury serves growing organisations with independent audit, accounting and payroll, tax,
www.dtm.gov.tr Foreign Trade and General Directorate of Imports consulting, VAT refunds, corporate finance, restructuring, energy audit, forensic
www.oib.gov.tr Privatization Administration accounting and wealth management throughout Turkey, Azerbaijan and The
www.deik.org.tr Foreign Economic Relations Board Caucasus. Kapital Karden was established in 1994 and became the correspondent
www.tusiad.org.tr Turkish Industrialists’ and Businessmen’s Association firm of RSM International in 1996 and member firm in 2008. Kapital Karden is proud
www.epdk.gov.tr Energy Market Regulatory Authority to be a part of such a strong international network that helps it attract, serve and
www.bddk.org.tr Banking Regulation and Supervision Agency partner global clients as they grow their businesses. The International Accounting
www.cmb.gov.tr Capital Markets Board of Turkey Bulletin, June 2009, named Kapital Karden ‘the fastest growing accountancy firm
www.tubitak.gov.tr Scientific and Technological Research Council of Turkey in Turkey’.
www.ttgv.org.tr Turkish Technology Development Foundation
www.kosgeb.gov.tr Small and Medium-sized Entities Development Organization Kapital Karden’s strengths lie in their being a well-known and trusted adviser; their
www.yased.org.tr International Investors Association understanding of the client, the nature of its business and the scope and timing of the
www.mfa.gov.tr Ministry of Foreign Affairs (for visa requirements) assignment; and also that the partners of the firm came from the Turkish Revenue
Service and Capital Markets Board. Weathering the storm of the financial crisis of
2001 the firm emerged stronger and better able to serve its clients. The firm provides
a high quality service in Turkish, Azeri, English, Japanese and Russian.
Clients of Kapital Karden include Turkish and international clients in the Technology,
Construction, Energy, Banking and Insurance, Retail, Manufacturing, Legal, Finance,
Conference and Textiles sectors with operations throughout the Euro Med Area,
China, the Middle East and Russia.
Contact
Kapital Karden
1 Siklamen Sokak
Levent 3
Istanbul
Turkey
Tel: + 90 212 284 3900
Fax: + 90 212 284 3901
Email: lketenci@kapitalkarden.com
Web: www.kapitalkarden.com
Web: www.kapitalsmm.com
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17. DOING BUSINESS IN TURKEY
Global Contacts
RSM International headquarters
Chief Executive Officer - Ms Jean Stephens
Tel: +44 20 7601 1080
Email: jean.stephens@rsmi.com
Regional liaisons
Africa Caribbean
Regional Contact - Mr Clive Betty Regional Contact - Ms Judit Petho
Tel: +27 11 329 6000 Tel: +44 20 7601 1080
Email: clive.betty@jhb.rsmbettyanddickson.co.za Email: judit.petho@rsmi.com
Americas Europe
International Director - Mr Bob Burdett Regional Director - Mr Paul Langhorn
Tel: +1 312 782 2124 Tel: +44 20 7601 1097
Email: robert.burdett@rsmi.com Email: paul.langhorn@rsmi.com
Asia Pacific Middle East
Regional Director - Mr Neil Hough Regional Contact - Shuaib A. Shuaib
Tel: +61 3 9286 1862 Tel: +965 2241 0010
Email: neil.hough@rsmi.com.au Email: shuaib.shuaib@albazie.com
33