Company Liquidation in Turkey: How to Close a Company Step by Step

Company liquidation in Turkey is a formal process under the Turkish Commercial Code (Law No. 6102): the shareholders resolve to dissolve the company, liquidators settle its debts, creditors are called three times through the Turkish Trade Registry Gazette, and the company is struck off only after a waiting period of at least one year. You cannot simply stop filing returns and walk away. A company left dormant keeps its tax and registry obligations, and its managers can stay exposed to public debts.

Below we explain how to close a company in Turkey step by step, who can act as liquidator, which documents you need, how long each stage usually takes and where foreign shareholders most often run into trouble.

What Does Company Liquidation in Turkey Involve?

Company liquidation in Turkey is the legal procedure that ends a company's existence once its affairs are wound up and any surplus is paid to the shareholders. It applies to joint stock companies (anonim şirket, A.Ş.) and to limited liability companies (limited şirket, Ltd. Şti.), the two forms most foreign investors use. The rules are largely the same for both.

There are three legal stages. Dissolution is the decision that the company will end. Liquidation is the period in which the company winds up its business while still existing as a legal person, with in liquidation (tasfiye halinde) added to its trade name. Deregistration (terkin) is the final removal from the trade registry.

During liquidation the company may only do what the winding up requires: collect receivables, sell assets, pay creditors and finish pending contracts. New business is not allowed. The liquidators take over representation from the board or the managers.

Options for Closing a Company in Turkey

Voluntary liquidation is the standard route for closing a company in Turkey when the company can pay all its debts. It is not the only option, and choosing the wrong one costs months.

A solvent company with no lawsuits is the simplest case. Unpaid suppliers, a pending court case, real estate on the books or a loan from a foreign parent company all need more planning. Whether voluntary liquidation, a merger or an insolvency route fits your company depends on its debts, its assets and who the shareholders are; a lawyer can assess it in a short consultation.

How to Close a Company in Turkey: The Steps in Order

Closing a company in Turkey follows a fixed sequence set by the Turkish Commercial Code, and a skipped step usually has to be repeated. The usual order for voluntary liquidation of a Turkish company is:

1. Prepare the books. Bring the accounts up to date with the company's accountant (mali müşavir) and list every known creditor and debtor.
2. Adopt the dissolution resolution. The general assembly resolves to dissolve the company and appoints one or more liquidators, with the majority required by the Turkish Commercial Code and the articles of association.
3. Register the dissolution. File the resolution and the liquidators' signature declarations with the trade registry office where the company is registered, for example the Istanbul Trade Registry Office. The registration is published in the Turkish Trade Registry Gazette (Türkiye Ticaret Sicili Gazetesi).
4. Notify the authorities. Inform the tax office that liquidation has begun, and notify the Social Security Institution (SGK) of employee terminations and any workplace closure.
5. Prepare the opening balance sheet. The liquidators draw up an inventory and an opening liquidation balance sheet for the general assembly to approve.
6. Call the creditors. The liquidators announce the liquidation three times in the Turkish Trade Registry Gazette at seven-day intervals, and on the company website where one is required, inviting creditors to register their claims. Known creditors are also notified directly.
7. Wind up the business. Collect receivables, sell assets, end contracts and pay debts, filing the liquidation-period tax returns as you go.
8. Wait out the creditor period. Remaining assets cannot be distributed to the shareholders until one year has passed from the third announcement.
9. Approve the final accounts. The general assembly approves the final liquidation balance sheet and releases the liquidators.
10. Distribute and deregister. The surplus goes to the shareholders, the final tax return is filed and the liquidators apply to the trade registry to strike the company off. The books and records must then be kept for ten years by a person named for that purpose.

One principle runs through every step. Creditors come first.

Who can act as liquidator?

The liquidators are often the existing board members or managers, but the general assembly can appoint a shareholder, an outside professional or a legal entity instead. The Turkish Commercial Code requires at least one liquidator to be a Turkish citizen domiciled in Turkey. For a company owned entirely by foreigners living abroad, finding that person is usually the first practical hurdle. Liquidators are personally responsible for doing the job properly, and if they find that debts exceed assets, they must inform the commercial court.

Documents Needed for Voluntary Liquidation of a Turkish Company

The document set for voluntary liquidation of a Turkish company is short, but each item has formal requirements. The usual list is:

• the general assembly resolution on dissolution and the appointment of liquidators, with the attendance list;
• the liquidators' acceptance of appointment and notarised signature declarations;
• the trade registry application forms and the texts of the three creditor announcements;
• the opening inventory and liquidation balance sheet, with the resolution approving it;
• tax office notifications and the liquidation-period corporate tax returns;
• SGK records and employee termination documents, where the company had staff;
• the final liquidation balance sheet and the final general assembly resolution.

Foreign shareholders often sign from abroad. A power of attorney or corporate resolution signed outside Turkey usually needs an apostille (or consular legalisation) and a sworn Turkish translation before a Turkish notary or registry will accept it. A foreign corporate shareholder will also need recent proof of its existence and of who may sign for it.

Tax, Social Security and Employee Obligations

Tax and social security closure usually sets the pace of the whole process, because the trade registry is only the formal end point. The company files a corporate tax return for each liquidation period (under the Corporate Tax Law, each calendar year of liquidation is a separate period) and a final return when liquidation ends. The tax office may also review the records before it closes the tax registration, especially where VAT refunds, related-party loans or large asset sales are involved.

Employees are dealt with under the Labour Law. Contracts end with the required notice or payment in lieu, qualifying employees receive severance pay, and unused annual leave is paid out. All of this must be paid before the shareholders receive anything, so budget for it at the start.

Public debts need particular care. Under Law No. 6183 on the collection of public receivables, unpaid taxes and social security premiums can be pursued against the company's legal representatives and, for a limited company, against the partners in proportion to their capital shares. Striking the company off does not erase them. Clear them first.

Turkish Company Liquidation Timeline

A realistic Turkish company liquidation timeline is around 12 to 18 months, because the law fixes a one-year creditor period that the shareholders cannot shorten on their own. Typical stages, as of the time this article is written:

• Preparation and dissolution resolution: usually two to four weeks, depending on the state of the books and how quickly signatures from abroad arrive.
• Registration and gazette publication: often one to two weeks after filing.
• Three creditor announcements: around three weeks.
• Creditor waiting period: one year from the third announcement, while the business is wound up.
• Final accounts, tax closure and deregistration: usually one to three months, longer if the tax office opens a review.

In limited cases a commercial court can allow an earlier distribution if it is satisfied that creditors are not at risk, but that is the exception. Planning around the full Turkish company liquidation timeline avoids surprises such as rent and accounting fees running long after trading has stopped.

Costs of Company Liquidation in Turkey

The costs of company liquidation in Turkey divide into official fees and other costs, and the professional side is usually the larger part. Official fee amounts are revised every year, so the lists below give the categories as of the time this article is written; confirm current figures with your lawyer or accountant when the process starts.

Official fees

• trade registry fees for registering the dissolution and the deregistration;
• Turkish Trade Registry Gazette fees for each publication, including the three creditor calls;
• notary fees for signature declarations, translations and certified copies;
• stamp tax on certain documents, and any tax due on asset sales.

Other costs

• accountant fees for the liquidation-period books and returns, which run for the whole year;
• legal fees for resolutions, registry filings and creditor issues;
• employee notice and severance payments, where applicable;
• rent, utilities and other running costs until the contracts end.

Common Mistakes When Closing a Company in Turkey

Most delays in closing a company in Turkey come from a handful of avoidable errors rather than from the law itself.

1. Abandoning the company instead of liquidating it. Stopping activity without a resolution leaves filing duties, penalties and the managers' exposure in place. Fix: liquidate formally, or keep the accounts and returns current until you do.
2. No eligible liquidator. Some foreign-owned companies name only non-resident foreigners as liquidators, and the registry will not accept that. Fix: appoint at least one Turkish citizen domiciled in Turkey from the outset.
3. Hidden public debts. In our practice at Karanfiloglu Law Firm, the most common cause of delay we see is an old tax penalty or unpaid premium that surfaces only when the closing file reaches the tax office. Fix: check the company's debt status with the tax office and SGK before the dissolution resolution.
4. Distributing money too early. Paying shareholders before the one-year period ends, or repaying a parent company loan ahead of other creditors, can make the liquidators personally liable. Fix: hold the funds until the final balance sheet is approved.
5. Foreign documents in the wrong form. A power of attorney signed abroad without an apostille or sworn translation is a routine reason for a filing to be returned. Fix: agree the exact wording and formalities before anyone signs.

Company Liquidation in Turkey: Key Points

Company liquidation in Turkey is predictable once you accept its fixed structure: a dissolution resolution, an eligible liquidator, three creditor calls, a one-year waiting period, and tax and social security closure before deregistration. Clean books and a full list of debts shorten every later stage. If you are working out how to close a company in Turkey while living abroad, settle the local liquidator and the document formalities first, because that is where foreign-owned companies most often lose time.

Talk to a Lawyer in Istanbul

If you would like advice on your own situation, Karanfiloglu Law Firm is a registered law office in Istanbul serving foreigners and Turkish clients across Turkey. You can reach us by phone or WhatsApp at +90 532 659 35 11, by email at karanfiloglu.lawyer@gmail.com, or visit us at Merkez Mah. Hasat Sk. No:12, 34384 Şişli, İstanbul. Contact us to discuss your situation.

Frequently Asked Questions

How long does company liquidation in Turkey take?

Company liquidation in Turkey usually takes around 12 to 18 months as of the time this article is written. The main reason is the one-year creditor period that starts after the third announcement in the Turkish Trade Registry Gazette; tax closure and deregistration then add one to three months in most cases.

Can a foreigner be the liquidator of a Turkish company?

Yes, a foreigner can be a liquidator, but at least one liquidator must be a Turkish citizen domiciled in Turkey. Foreign shareholders often appoint a local professional alongside a foreign manager to meet this requirement.

Can I close my Turkish company from abroad?

In most cases you can close a Turkish company without travelling to Turkey. Shareholders usually act through an apostilled and translated power of attorney, while the Turkey-based liquidator handles the registry, tax and SGK steps locally.

What happens if I just stop using my company in Turkey?

A company that simply stops trading remains registered and keeps its obligations. Accounting, tax returns and registry duties continue, penalties can build up, and unpaid public debts can be pursued against the managers and, for a limited company, the partners.

Can the one-year waiting period be shortened?

Generally no, the shareholders cannot shorten the one-year creditor period themselves. In limited cases a commercial court may allow an earlier distribution if it is satisfied that creditors are not at risk.

What if the company has more debts than assets?

Voluntary liquidation is not the right route for an insolvent company. If the liquidators find that debts exceed assets, they must inform the commercial court, and the matter usually moves to bankruptcy or a concordat procedure.

Is a company in liquidation still required to file tax returns?

Yes, a company in liquidation keeps filing tax returns. It submits corporate tax returns for each liquidation period and a final return at the end, together with its other returns such as VAT and withholding tax while it still has transactions.

Can a company in liquidation in Turkey be revived?

Yes, under Article 548 of the Turkish Commercial Code the general assembly can resolve to end the liquidation and continue the company, provided that distribution of the assets to the shareholders has not yet begun. The resolution must be registered with the trade registry like the original dissolution.

About the Author

Kaan Karanfiloğlu is the founder of Karanfiloglu Law Firm, an Istanbul-based registered law office serving Turkish and international clients across Turkey. He is a lawyer registered with the Istanbul Bar Association (Reg. No. 58270) and the Union of Turkish Bar Associations (No. 133074), and has practised law in Turkey since 2017. He holds an LL.B. from Galatasaray University Faculty of Law (2016) and advises clients in Turkish, English and French; Russian- and Chinese-speaking clients are served through native-speaking advisors at the office.

Disclaimer: This article provides general information about Turkish law and is not legal advice. Laws, regulations, official fees and procedures change over time and every situation is different. For advice on your specific circumstances, please consult a qualified lawyer. No liability is accepted for any loss arising from reliance on the information in this article.