It is essential for companies planning to run Payroll Services in Türkiye to have a clear plan and make the right moves from day one. The Republic of Türkiye straddles continents – a bridge between Europe and Asia – which makes it a prime target for expansion by foreign companies looking to widen their economic horizons.
Making that move, however, demands taking the proper steps from day one. Türkiye’s geographical location is a stepping stone between Europe and Asia. It is mostly in western Asia, with a small area in the northwest placed in Europe, across the inland Sea of Marmara, in the Balkan Peninsula and bordering Bulgaria and Greece. Türkiye has eastern borders with Georgia, Azerbaijan, Armenia and Iran and a southern border with Iraq and Syria. There is a Black Sea north coast and a southern coastline on the Aegean and Mediterranean Seas. Europe’s major cities are within three hours of Türkiye by air. Its main trading partners include Germany, the UK, Italy, Iraq, China and Russia and around 60% of exports, by value, are to Europe.
In 2021, Türkiye had a Gross Domestic Product of US$810 billion to be ranked 21st globally. However, Türkiye needs to attract more Foreign Direct Investment to improve global competitiveness and keep pace with other developing economies, adding appeal to incoming foreign corporations. To this end, it provides cities with an ‘investment incentive environment’ for specific sectors.
Challenges come alongside the potential benefits, however. Payroll management is among those challenges, whether your company is considering moving employees abroad or hiring new staff in-country. Employment laws, payroll and income tax regulations are areas where you cannot afford mistakes. Bradford Jacobs’ Professional Employer Organisation (PEO) and Employer of Record (EOR) platforms and networks provide complete answers to every question your company will encounter before you move into the economy, especially when it comes to operating payroll. Bradford Jacobs’ specialists become your employees’ effective Employer of Record for all these issues while they remain under your daily operational control.
Remote payroll – This option allows businesses to operate under a single payroll system by adding employees in Türkiye to the parent company’s payroll. However, these employees must operate under different regulations, which is likely to cause problems.
Internal payroll – You may operate payroll for your subsidiary, especially if you are committed to growing your company’s presence in Türkiye. However, this does require hiring dedicated HR staff who understand Türkiye’s employment and compliance laws.
Turkish payroll processing company – If you are considering outsourcing, then working with a Turkish payroll company will help in processing your payroll – but not when it comes to compliance.
Turkish payroll outsourcing – However, another option is available to solve both concerns – by working with Bradford Jacobs. We can handle payroll and compliance for all your employees in Türkiye. We lift the administrative stress from your shoulders so you can focus on what you do best.
Foreign companies establishing their presence in Türkiye are in a prime position for further expansion. Its geographical location with coastlines on both the Black Sea and the Mediterranean makes Türkiye a “stepping stone” between Europe and western Asia. The potential is obvious, but challenges are inevitable, and initially, they will revolve around payroll, whether companies import staff into the country or recruit inside Türkiye.
Employment laws, payroll and tax regulations are areas where you cannot afford mistakes – and the demands are even greater where foreign companies establish a subsidiary as their route into Türkiye. The typical choice is establishing a limited liability company (Ltd. Şti.) as a subsidiary to operate payroll for staff. The subsidiary will operate under the new Turkish Commercial Code (TCC). Taking this major step requires an in-depth understanding of the procedures for registering employees. These include the following:
Foreign companies setting up subsidiaries in Türkiye must meet various requirements before operating payroll services in Türkiye. First is establishing a subsidiary, usually a limited liability company (Ltd. Şti.), which operates under the new Turkish Commercial Code (TCC). Türkiye formally changed its name (from Turkey) in June 2022 and is recognized as such by the United Nations.
Establishing any company overseas inevitably involves dealing with red tape. In Türkiye, for example, procedures to set up a limited liability company include:
Once established, entities must register with the relevant district tax office and the provincial social insurance authority and obtain necessary workplace permits from the appropriate municipality. Companies intending to trade must register with the local Chamber of Commerce and those involved in production operations with the Chamber of Industry.
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