Turkish Branch of a Foreign Company
Establishing a Turkish branch that operates under the foreign parent's legal personality.
Scope
Under Turkish Commercial Code Art. 40 and Trade Registry Regulation Art. 121-128, the parent operates in Turkey without forming a new legal entity. Tax position: limited (non-resident) taxpayer — only Turkish-source income is taxed. Full VAT, corporate tax and withholding obligations apply. The branch manager must be resident in Turkey.
- Structure analysis — branch vs A.Ş./Ltd. decision matrix (liability, tax, repatriation)
- Parent documentation: activity certificate, articles, latest balance sheet (apostilled + sworn Turkish translation)
- Branch manager selection + Turkish residency status
- Branch trade name + business object filing (TCC Art. 40/3)
- Trade Registry filing under the parent's legal personality
- Tax number, MERSİS, VAT registration
- Bank account opening — AML interview for foreign capital included
- e-Invoice, e-Ledger, e-Archive activation
- Double tax treaty position — withholding rate for profit repatriation
- Annual corporate tax filing (limited taxpayer) + profit transfer tax report
Process
- 01
Structure call
Branch vs separate entity — liability spillover, tax delta, exit position.
- 02
Documents + translation
Apostille + sworn translation of parent documents; typically 3-4 weeks.
- 03
Registration
Trade Registry filing + registration; 2 weeks.
- 04
Operational launch
Tax, MERSİS, bank, e-signature, e-invoice — 2 weeks.
Frequently asked
What is the core difference between a branch and an A.Ş./Ltd.?
A branch is the Turkish extension of the parent's legal personality — liability flows to the parent. An A.Ş./Ltd. creates an independent Turkish entity with limited liability. Tax position: branch is a limited (non-resident) taxpayer (Turkish-source income only); A.Ş./Ltd. is a full taxpayer (worldwide income). The choice depends on scale — branch is fast for a small office, A.Ş. is preferred once investment scale grows.
How is branch profit repatriated to the parent?
After-tax branch profit is repatriated to the parent in a dividend-like flow. The general withholding rate is 15%, but reduced rates apply under double tax treaties (e.g., UK 5-15%, Germany 5-15%). A tax residency certificate must be obtained in advance to apply the reduced rate.
Must the branch manager be a Turkish citizen?
No. There is no Turkish citizenship requirement for branch managers — but the manager must be resident in Turkey (residence permit). If the appointee is a foreign national, a work permit is required.