# Company setup, taxes and your accountant

> Sole proprietorship vs Ltd. vs A.Ş.; setup steps; VAT, withholding, social security; e-invoice and cash registers.

Source: https://fizibi.com/en/guides/sirket-kurulusu-ve-vergi
Updated: 2026-09-06

## Sole proprietorship or limited company?

| | Sole proprietorship | Limited (Ltd.) | Joint-stock (A.Ş.) |
|---|---|---|---|
| Setup | 1-2 days, ₺3-10k | 2-5 days, ₺25-45k | 2-5 days, ₺35-65k |
| Minimum capital | none | ₺50,000 | ₺250,000 |
| Liability | unlimited (personal assets) | limited for commercial debts; partners liable pro rata for tax/social security | shareholders not liable for public debts (board members are) |
| Tax | income tax 15-40% | corporate 25% + 15% withholding on distribution | same |
| Investor entry | hard | possible, notary + registry | easy; required for angel tax incentive |
| When | single founder, small budget, young founder under 29 | partners or a loan | investor round, multi-unit, franchise HQ |

First-time sole proprietors under 29 get a 3-year income-tax exemption and one year of social security support.

## Setup steps

1. Choose an accountant (SMMM); they run the incorporation.
2. Articles on MERSİS, notarised signature declaration, trade registry (company) or tax office commencement notice (sole trader).
3. Tax office visit and tax plate.
4. Chamber registration (Chamber of Commerce or the relevant craftsmen's chamber).
5. Social security workplace file; employee entry one day before the first hire.
6. Fiscal cash register approval and e-invoice/e-archive application.
7. Bank account and POS.

## What are the monthly and annual obligations?

VAT return (monthly), withholding and social security declaration (monthly), advance tax (quarterly), annual income/corporate return (March/April). Accountant fees for an 8-15 employee Ltd. run ₺8-15k a month.

## How are VAT and withholding calculated?

Food service carries 10% VAT, alcoholic beverages 20%. Input VAT (fit-out and equipment 20%; food 1-10%) is offset against sales VAT; investment VAT is recovered over 6-14 months. Rent paid to a private landlord carries 20% withholding; so do payments to accountants, architects and lawyers.

## Are a fiscal register and e-invoice mandatory?

Every sale needs a receipt. e-Invoice becomes mandatory above ₺3 million annual revenue; for sales via your own site or platforms the threshold is ₺500k. Working with an e-invoice integrator from day one avoids a painful migration.

## Which government incentives exist?

The entrepreneur support programme (NACE 56 eligible) requires entrepreneurship training before incorporation; the grant part is limited and the process takes 3-9 months. Do not count these as cash in the base case. The young-entrepreneur tax exemption, İŞKUR on-the-job training and the 5-point social security discount are more tangible.

## Why is a partnership agreement essential?

With partners, sign a shareholders' agreement in addition to the articles: capital and sweat-equity shares, profit distribution, decision authority, exit and share buy-back, non-compete.