Setting up a branch in Turkey is a strategic move for foreign companies looking to expand their business presence in a fast-growing market. With its favorable geographic location, customs union with the EU, and investor-friendly laws, Turkey presents significant opportunities for global business expansion. In this guide, we cover the legal procedures, tax obligations, and documentation requirements for establishing a branch office in Turkey.
Can Foreign Companies Open a Branch in Turkey?
Yes. Foreign legal entities can open branch offices in Turkey under the Turkish Commercial Code (TCC) and related regulations. However, branches are not considered separate legal entities—they are an extension of the parent company. Therefore, the parent company holds full liability for all branch obligations.
Key Legal Requirements for Branch Registration
To establish a branch in Turkey, the following steps must be completed:
- Board Resolution: The parent company must pass a resolution to establish a branch in Turkey and appoint a branch representative.
- Prepare Required Documents: These include articles of association, commercial registry records, activity certificate, and power of attorney. All documents must be notarized and apostilled.
- Appoint a Branch Representative: A legal representative must be appointed who will act on behalf of the branch.
- Apply to the Trade Registry: Submit the application with translated and notarized documents to the relevant Trade Registry Office.
- Tax Office Registration: After Trade Registry approval, register with the local tax office and obtain a tax identification number.
Required Documents for Branch Establishment
- Notarized and apostilled articles of association of the parent company
- Certificate of Good Standing or Activity Certificate
- Board Resolution approving the branch establishment
- Power of Attorney for the branch representative
- Signature declaration of the branch representative
- Proof of address for the branch office in Turkey
Taxation and Financial Reporting
Branches in Turkey are subject to corporate income tax on their income generated within Turkey. The current corporate tax rate is 25% (as of 2024). In addition, branches are required to:
- Maintain statutory books
- File monthly VAT and withholding tax returns
- Submit annual corporate tax returns
- Prepare annual financial statements
Why Work with a Turkish Law Firm?
Establishing a branch office in Turkey involves several legal and procedural steps. Working with a Turkish law firm ensures compliance with local corporate and tax regulations. At Istanbul Lawyer Firm, our Turkish lawyers assist foreign companies from start to finish—document preparation, regulatory filings, tax compliance, and legal representation. With our English-speaking legal team, we ensure a smooth and secure entry into the Turkish market.
Read our previous article: Buying Property in Turkey