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Turkey Branch Office

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Turkey Branch Office: Learn how to establish a Branch Office in Turkey, including advantages, taxation and costs.

Turkey’s strategic position between Europe, the Middle East, and Central Asia, combined with its Customs Union with the EU, makes it an attractive jurisdiction for foreign companies. One of the most efficient methods of entering the Turkish market without forming a separate legal entity is through a Branch Office in Turkey.

This article provides a comprehensive overview of Turkey Branch Offices, including establishment procedures, required documents, advantages, taxation, costs and fees, comparison with subsidiaries and liaison offices, and liquidation.

What Is a Branch Office in Turkey?

A Branch Office is not a separate legal entity but an extension of a foreign parent company operating in Turkey. It conducts commercial activities on behalf of the parent company, which remains fully and directly liable for all obligations arising from the branch’s operations.

The branch must operate within the scope of the parent company’s business objectives and is subject to the Turkish Commercial Code, tax legislation, and labour law.

Advantages of a Turkey Branch Office

No minimum capital requirement
Unlike a subsidiary, a branch office can be established without allocating share capital.
100% foreign ownership
The branch is fully owned and controlled by the foreign parent company.
Faster and simpler setup
Registration procedures are generally quicker than incorporating a Turkish company.
Full commercial activity permitted
A branch office may engage in trading, manufacturing, and service activities within the scope of the parent company.
Direct control by the parent company
Strategic and operational decisions remain with the head office.
Strong market credibility
Branch offices are perceived as more reliable than liaison offices by banks and business partners.
Ease of profit repatriation
Profits can be transferred to the parent company, subject to applicable withholding tax. Withholding tax rates can be minimized through double tax treatments.
Suitable for market entry and project-based operations
Ideal for companies testing the Turkish market or executing short- to mid-term projects.
Simplified corporate structure
No separate legal personality or shareholder structure is required.

How to Establish a Branch Office in Turkey?

Establishing a Branch Office in Turkey allows foreign companies to conduct commercial activities without forming a separate legal entity. The process is structured, relatively fast, and governed by Turkish commercial and tax regulations.

1. Parent Company Resolution

The foreign parent company must adopt a formal resolution approving:

The establishment of a branch office in Turkey
The scope of business activities
The appointment and powers of the Branch Representative

2. Appointment of a Branch Representative

At least one authorised branch representative must be appointed to manage and represent the branch.

May be a Turkish citizen or a foreign national
Must have full authority to bind the branch

3. Permission from the Turkish Ministry of Industry and Technology.

According to local legislation, foreign companies wishing to open a branch in Türkiye must apply for authorization from the Ministry of Industry and Technology of the Republic of Türkiye.

4. Preparation and Legalisation of Documents

All corporate documents issued abroad must be:

Notarised
Apostilled or consularly legalised
Translated into Turkish by a sworn translator

5. Trade Registry Registration

The branch is registered with the relevant Turkish Trade Registry Office.
Upon registration, the branch gains legal authority to operate in Turkey.

6. Tax and Social Security Registration

Following Trade Registry registration:

Corporate tax registration is completed
VAT registration is obtained (if applicable)
Social Security Institution (SGK) registration is completed for employees

7. Post-Registration Formalities

Opening a Turkish bank account
Obtaining sector-specific licences or permits (if required)
Implementing statutory accounting and e-invoicing systems

8. Typical Timeline

Permission from the Ministry: 3–5 weeks
Document preparation and legalisation: 2–3 business days
Trade Registry registration: 1–3 business days
Tax and SGK registration: 2–3 business days

➡️ In practice, a Branch Office in Turkey can become fully operational within 5–7 weeks.

Taxation of a Branch Office in Turkey

A Branch Office in Turkey is treated as a permanent establishment of the foreign parent company and is subject to Turkish tax legislation on income generated within Turkey.

Corporate Income Tax (CIT)

Branch offices are subject to Corporate Income Tax on their Turkey-sourced profits.
Current CIT rate: 25%
Tax returns are filed annually, with advance (provisional) tax declarations submitted quarterly.

Withholding Tax on Profit Remittances

Profits transferred from the branch to the foreign parent company are subject to withholding tax.
Standard rate: 15%
The rate may be reduced or eliminated under applicable Double Taxation Treaties (DTTs).

Value Added Tax (VAT)

Branch offices must register for VAT if they carry out taxable transactions in Turkey.
Standard VAT rate: 20%
Monthly VAT returns are mandatory.

Withholding Taxes on Payments

Depending on the nature of payments made by the branch, withholding tax may apply to:

Salaries and wages
Professional and consultancy services
Rent payments
Royalties and licence fees

Rates vary according to payment type and treaty provisions.

Social Security Contributions (SGK)

Employer and employee social security contributions apply to branch employees.
Employers are responsible for withholding and remitting SGK contributions monthly.

Accounting and Compliance Obligations

Statutory bookkeeping must be maintained in accordance with Turkish regulations
Monthly and annual tax filings are mandatory
E-invoice and e-ledger systems may be required depending on turnover thresholds
Independent audit obligations may apply based on size criteria

Key Tax Considerations

Only income attributable to Turkish activities is taxable in Turkey
Transfer pricing rules apply to transactions with the parent company
DTT provisions should be reviewed before profit remittance

Comparison: Branch Office vs Subsidiary vs Liaison Office

Criteria	Branch Office	Subsidiary (LLC or JSC.)	Liaison Office
Legal Personality	No	Yes	No
Commercial Activity	Allowed	Allowed	Not allowed
Minimum Capital	None	Required	None
Tax Liability	Yes	Yes	No
Profit Distribution	May be Subject to WHT	Dividend WHT	Not applicable
Parent Company Liability	Unlimited	Limited	Unlimited
Typical Use	Market entry	Long-term investment	Market research

When to Choose a Branch Office?

A branch office is suitable for:

Companies testing the Turkish market
Businesses requiring operational presence without incorporation
Firms wanting full control from the head office
Short- to medium-term commercial projects

For long-term investment or liability limitation, a subsidiary is often the preferred option.

Costs & Fees for Establishing a Branch Office in Turkey

The cost of establishing a branch office depends on the parent company’s country of incorporation, document volume, and professional support required. Typical cost components include:

One-Off Establishment Costs

Trade Registry registration fees
Notary and sworn translation costs
Setting up of accounting and e-applications(e-ledger & e-invoice)
Legal and consultancy service fees

Indicative total setup costs:
EUR 3,500 – 5,000 + VAT (excluding foreign document legalisation costs)

Ongoing Monthly Costs

Accounting and bookkeeping services
Monthly tax filings and declarations
Independent audit (if applicable)
Payroll and SGK compliance costs

Indicative monthly compliance costs:
EUR 1,000 – 1,500 + VAT, depending on activity volume and staffing

Liquidation of a Branch Office in Turkey

Since a branch office has no separate legal personality, its closure is handled through deregistration and termination of activities.

Liquidation Procedure

Parent company resolution approving closure
Appointment of Liquidator
Settlement of tax, social security, and employee liabilities
Filing of final tax returns and declarations
Deregistration from the Tax Office
Deregistration from the Trade Registry
Closure of bank accounts and official records

Timeline

Typically 4–6 months, depending on outstanding liabilities and tax audits

Key Considerations

The liquidator must be a Turkish citizen.
All tax and SGK obligations must be fully settled
Employee terminations must comply with Turkish labour law

Get in Touch For Branch Office Registration in Turkey

A Turkey Branch Office offers foreign companies a fast and flexible route into the Turkish market without the need to establish a separate legal entity. While it provides operational freedom and cost efficiency, it also exposes the parent company to unlimited liability and full tax compliance obligations.

Selecting the correct structure—branch office, subsidiary, or liaison office—and planning both entry and exit strategies with professional support is essential for long-term success in Turkey.

With extensive experience advising multinational companies and foreign investors in Turkey, our team ensures that the establishment and operation of Branch Offices in Turkey are fully compliant with the Turkish Commercial Code, tax legislation, and regulatory requirements, while being structured efficiently and implemented without unnecessary delays.

Establishing a branch office in Turkey requires careful coordination of legal, tax, and accounting procedures, as the branch operates as a permanent establishment of the foreign parent company. Whether your objective is market entry, execution of local projects, or expansion of existing operations, professional guidance is essential to mitigate compliance risks and ensure a smooth setup.

The branch office establishment process involves multiple regulatory steps, including parent company resolutions, appointment of a branch representative, legalisation and translation of corporate documents, Trade Registry registration, and tax registrations. Having a trusted advisor ensures that each step is completed accurately, transparently, and in full compliance with applicable legislation.

A&M Consulting Co. is a well-established consultancy firm based in Istanbul, duly registered and accredited with TURMOB and ISMMMO, and recognised for its strong commitment to professional integrity, regulatory compliance, and client-focused service delivery.

Whether you are establishing a branch office for trading, service provision, or project-based activities, our experienced team delivers end-to-end Branch Office Services in Turkey. We manage the entire process—from preparing and reviewing parent company resolutions, coordinating notarisation and apostille procedures, handling Trade Registry registrations, to completing all tax and social security filings accurately and on time.

With years of experience supporting both local enterprises and international investors, A&M Consulting Co. offers cost-effective, reliable, and transparent solutions tailored to your business objectives in Turkey.

If you are planning to establish a Branch Office in Turkey, partner with A&M Consulting Co. to ensure a seamless process, full regulatory compliance, and efficient market entry. Contact us today to proceed with confidence.

DISCOVER OUR SERVICES:

You can reach out to our experienced consultans via email or by filling out the Contact Form on our website’s contact page

FAQs About Turkey Branch Office

What is a Branch Office in Turkey?

A Branch Office is an extension of a foreign parent company operating in Turkey without separate legal personality. All liabilities belong to the parent company.

Can a Branch Office in Turkey conduct commercial activities?

Yes. A branch office may conduct full commercial activities within the scope of the parent company’s business.

Is a minimum capital required to establish a Branch Office in Turkey?

No. There is no minimum capital requirement for branch offices.

Is 100% foreign ownership allowed?

Yes. A branch office is fully owned and controlled by the foreign parent company.

How long does it take to establish a Branch Office in Turkey?

Typically 5–7 weeks, depending on document preparation and legalisation timelines.

What documents are required to open a Branch Office in Turkey?

Key documents include the parent company’s Certificate of Incorporation, Articles of Association, Board Resolution, and appointment of a Branch Representative, all duly legalised and translated.

Who can be appointed as a Branch Representative?

A Turkish citizen or a foreign national may be appointed. The representative must have full authority to act on behalf of the branch.

Is a Branch Office subject to corporate tax in Turkey?

Yes. Branch offices are taxed on income generated in Turkey at the corporate income tax rate.

Are profits transferred to the parent company taxed?

Yes. Profit remittances are subject to withholding tax, which may be reduced under Double Taxation Treaties.

Is VAT registration mandatory for a Branch Office?

Yes, if the branch carries out VAT-taxable transactions in Turkey.

What accounting obligations does a Branch Office have?

The branch must keep statutory accounting records in Turkey and file monthly and annual tax returns.

What is the difference between a Branch Office and a Subsidiary in Turkey?

A branch has no separate legal personality and exposes the parent company to unlimited liability, whereas a subsidiary is a separate legal entity with limited liability.

How is a Branch Office different from a Liaison Office?

A branch office may conduct commercial activities, while a liaison office is limited to non-commercial activities such as market research.

Can a Branch Office employ staff in Turkey?

Yes. Branch offices may hire employees and must comply with Turkish labour and social security laws.

How can a Branch Office in Turkey be closed?

Closure involves parent company resolution, settlement of tax and employee liabilities, and deregistration from the Tax Office and Trade Registry.

. How long does the Branch Office liquidation process take?

Usually 4–6 months, depending on outstanding liabilities and tax clearances.

Is it possible to convert a Branch Office into a Subsidiary?

Direct conversion is not possible, but a subsidiary may be established and the branch closed thereafter.