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What should you pay attention to when establishing a company? In this blog content, we will examine company types, steps to establish a company, and the required documents in detail.
Recently, especially with the effect of the pandemic, people have started to either establish their own businesses directly or look for a second source of income through their existing jobs. Some are looking for ways to earn income as freelancers by leveraging their knowledge, while others are doing e-commerce.
In any case, if you want to start your own business, you need to establish at least a sole proprietorship. If you wish to carry out large-scale commercial activities, it may also be beneficial to establish a limited liability company or a joint-stock company.
In our country, the only way to do business without establishing a company is to benefit from the tradesman exemption. The main condition for this is that you produce the products you sell at home without using industrial-type machines. Details regarding the tradesman exemption can be found in Article 9 of the Income Tax Law.
Before establishing your company, do not forget to check your trade name, create articles of association on MERSİS, and submit your KOSGEB application before the establishment.
Steps to Establish a Company
The first step in establishing a company is to decide what type of company you will establish. According to the needs of your business, you should decide whether to establish a sole proprietorship or to evaluate other options.
We can talk about different criteria in choosing a company type. Before the establishment, a decision should be made by considering these criteria. For example, if your earnings expectation, your annual earnings expectation is around 100-200 thousand TL, we can say that establishing a sole proprietorship will meet your needs. If you aim to exceed this amount, it would be more appropriate to establish a company that will be a corporate tax payer.
The main situation to be considered in matters such as receiving investment, transferring the company, and acquiring real estate in the future is your special conditions. In other words, one of the criteria may guide you to establish a sole proprietorship, but you may encounter a legal restriction saying that only joint-stock companies can do the work you will do. According to another example, all criteria may tell you to establish a limited company, but if you can be included in the young entrepreneur exemption, you can review the criteria accordingly and decide that establishing a sole proprietorship is more appropriate.
Establishment of a Limited Liability Company
The first stage of establishment is the preparation of the articles of association. For this, the company title is determined through the mersis application of the chamber of commerce and sent for the approval of the relevant chamber. Afterwards, the partners, managers, and members of the company are specified in the articles of association. In addition to this information, your company's fields of activity should also be included in the articles of association. After all this information is determined, Mersis is logged in, and the potential tax number and tax office information are obtained from the system.
Today, the obligation to block one-fourth of the capital in limited liability companies has been lifted. For this reason, it is sufficient to transfer the minimum capital amount of 10,000 TL required for the establishment of a limited liability company to the company account within 2 years. After all these stages are completed, an appointment must be made with the Chamber of Commerce for the trade registry registration of the company and this process must be completed.
Establishment of a Joint-Stock Company
The establishment stages can be listed as follows:
• Preparation of the articles of association
• Approval of the articles of association in the trade registry
• Obtaining a potential tax number
• Depositing the relevant amount of capital into the bank
• Payment of the Competition Authority share in the amount of four ten-thousandths of the capital
• Delivery of the documents required for establishment to the trade registry
• Making the opening notification to the tax office
• If any, registration of the relevant chamber (such as chamber of industry, chamber of profession)
The first stage of establishment is the preparation of the articles of association, just like in a limited liability company. After the company title is determined, the general assembly and board of directors members of the company are determined and included in the articles of association. The company's fields of activity must also be specified in the articles of association.
In fact, when we look at it in a general sense, the establishment of a joint-stock company and a limited liability company are almost the same. Except for some minor differences in the process, unlike limited liability companies, one-fourth of the minimum capital amount of 50,000 TL in joint-stock companies (or of this amount if your capital is higher) is deposited in the bank and blocked. Then, the relevant documents are forwarded to the trade registry.
The chamber of commerce completes the establishment by creating the necessary books. Following the chamber of commerce transactions, the company establishment is reported to the relevant tax office and finally, if necessary, registration is made to the relevant chamber of profession.
Actually, with the survey, your company is established. However, of course, immediately after this process, you should decide on the type of invoice you will use, and if necessary, make your agreements with marketplaces.
