A fiscal representative in Turkey is an entity or individual appointed to handle a foreign business’s tax and financial obligations in the country. Usually, this representative manages a foreign business’s VAT registrations, tax filings, and communication with Turkish tax authorities. We can help you with fiscal representation and give you more details if you are interested in setting up a company in Turkey.

When do you need a fiscal representative in Turkey?

It is not mandatory for foreign businesses to have a fiscal representative in Turkey. However, if a foreign business has a local agent in Turkey, it may be required to appoint a representative.This is because having a local agent can trigger certain tax obligations and responsibilities that align with those of resident businesses.

If you want to open a company in Turkey, you are required to establish it in the country. As part of this process, you must also appoint a fiscal representative.

Responsibilities of a fiscal representative in Turkey

The responsibilities of a fiscal representative in Turkey include a wide range of tasks related to tax compliance and financial management. These tasks include:

• Assistance in registering for tax purposes, including value added tax (VAT), corporate income tax (CIT), and other applicable taxes, with Turkish tax authorities;
• Preparing and submitting accurate and timely tax returns and reports;
• Acting as a liaison between the clients and Turkish tax authorities;
• Managing and maintaining all tax-related documentation, including invoices, receipts, and financial records;
• Ensuring that tax payments are made on schedule.

These responsibilities may vary depending on the specific needs of the business. We can also recommend our partner accountants in Turkey for handling other tax-related matters and our Turkish lawyers for different legal issues.

VAT registration in Turkey

The standard VAT rate in Turkey is 20%. The country has also reduced VAT rates – 10%, 1%, and 0% – which apply to specific categories of goods and services. There is no specific threshold for VAT registration, and businesses are required to register regardless of their turnover. In this case, you can appoint a fiscal representative in Turkey.

However, non-resident businesses may use the reverse charge mechanism, where the responsibility for paying VAT shifts from the supplier to the recipient (the buyer). In this case, the Turkish customer reports and pays the VAT directly to the tax authorities. Non-resident businesses may also be subject to partial withholding VAT regimes.

An exception applies to non-resident businesses providing electronic services (e-services) to consumers in Turkey. They are required for VAT registration in the country, and a fiscal representative in Turkey in this case might be helpful.

The tax authorities responsible for VAT in Turkey are part of the Revenue Administration, which falls under the Ministry of Finance and Treasury.

We can give you more details about VAT registration, after you set up a company in Turkey.

Statistics about taxes in Turkey

If you are willing to discover more about taxes in Turkey and the tax revenue in the country, here are some statistics from the OECD for the year 2021:

• Turkey generated 1.654.956 million Turkish Lira from taxes;
• Taxes on income, profits, and capital gains contributed with 397.629 million Turkish Lira to the total amount;
• The highest number was collected from the taxes on goods and services, amounting to 696.341 million Turkish Lira.

We also offer payroll services in Turkey for interested companies. If you are looking for a fiscal representative in Turkey, or wish to know more on this subject, please contact our team for assistance.