Liaison Offices

Seda Bayraktar
  • Seda Bayraktar, CPA
  • Partner
  • Accounting Compliance & Reporting
  • E-mail to Seda

If you are not planning to perform any commercial / income-generating activities in Turkey, liaison office is the best structure preferred by foreign investors as a vehicle to enter into Turkish market.

Foreign entities basically prefer liaison office structures in Turkey in order for their representation and to gather information on behalf of the parent company in the related sector and the country. Liaison offices are advantageous way to promote parent company's business activities in Turkey. This structure also enables the companies to familiarize with the Turkish market, analyze the business volume and understand the legal requirements. Liaison offices are basically preferred as they are not corporate tax payers and their employees are exempt from income tax. 

The activities that may be carried out by a liaison office have been specified by the laws as follows:

  • Market research
  • Promotion of the goods and services of the parent company
  • Representation and hosting
  • Control of the suppliers in Turkey in terms of quality and standard, their supervision
  • Technical support
  • Communication and information transfer
  • Regional management center
  • Other

Establishment of liaison offices in Turkey is regulated under the Foreign Direct Investment Law numbered 4875 and Regulation on the Implementation of Foreign Direct Investment Law. As per such relevant legislation, their establishment is subject to the approval of the Ministry of Economy.

Once the establishment application is made to the Ministry, liaison offices are granted with an approval for a period of 3 years within the scope of their determined activities.

How Cerebra can help

Cerebra may provide the below services to your liaison office just after the related permission is obtained from the Ministry:

Recording and Reporting of Expenses and Tax Compliance Services

  • Inputting all the office expenses into the system in accordance with the Turkish Uniform Chart of Accounts.
  • Filing of all the supporting documents of the expense payments made through the bank account of the office.
  • Reconciliation of expenses as recorded in the system with bank statements on a monthly basis.
  • Preparation of the monthly report for the details of the expenses made by the liaison office in English.
  • Preparation of the quarterly withholding tax returns and monthly stamp tax returns.
  • At the end of May of each year, an information form about the activity of the last year is filled in and informed to the Undersecretariat of Treasury. The documents proving that the expenses regarding the last year activities of the office are attached to the mentioned form.
  • Communication with the headquarters for any questions they may have in relation with our services provided.

Payroll Services

  • Processing the payroll information of the office staff based on the information received from the liaison office management.
  • Calculation of monthly net salaries and the related salary deductions, i.e. social security contributions.
  • Preparation of monthly salary pay slips for the employees.
  • Calculation of severance and notice payments.
  • Preparation of payroll list and delivery of list of salary payments to the liaison office management.
  • Preparation and filing of the social security e-declarations with the Social Security Organization.
  • Preparation and submission of necessary legal forms of personnel including starters and leavers to the Social Security Institution Area Administration and Turkish Labor Institution.

Accounts Payable and Payments Management

  • All the documents and invoices are delivered to Cerebra by the liaison office management at the certain times of the month agreed with the office management.
  • Follow-up the due-dated invoices.
  • Preparation of payment lists and sending the payment lists with the supporting documents for the approval of the liaison office management twice a month on the days agreed with the management.
  • After getting the necessary approvals from the Office management for the items in the payment list as mentioned above, entering the payments into the bank’s internet banking system and the payments are approved by the Office management through the internet banking system.
  • For the approved tax and social security payments, preparation of the necessary bank instruction letters to be sent to the Office management for their signature. Upon receipt of the signed instruction letters from the Office management, sending them to the bank and follow-up their payments.