Financial Regulation Advisory

The ordinary general assembly meets within 3 months of the end of each financial year (Turkish Commercial Code, Arts. 409 and 617). For companies using the calendar year, this means by the end of March at the latest. The general assembly approves the financial statements, releases the managers and decides on profit distribution.

A transfer of capital shares must be made in writing with notarised signatures (Turkish Commercial Code, Art. 595). Unless the articles of association provide otherwise, the transfer becomes effective upon approval by the general assembly and is registered with the trade registry. The tax consequences (capital gain, stamp duty) are assessed separately based on the transfer price.

In capital companies, a change of address is registered with the trade registry. Under Article 157 of the Tax Procedure Law, the tax office must be notified within 1 month; registration through the trade registry is usually passed on to the tax office, but the inspection visit and record update should be followed up. The SGK workplace address is updated separately.

Corporate taxpayers must join the Revenue Administration's e-Notification system under Article 107/A of the Tax Procedure Law. In addition, joint-stock and limited companies are required to obtain an electronic notification address under the Notification Law. An electronic notification is deemed served at the end of the 5th day after it reaches the address, so the inbox must be checked regularly.

A capital increase requires a general assembly resolution amending the capital clause of the articles of association, which is then registered with the trade registry. A Competition Authority fee is paid on the increased amount. The increase can be made in cash, from internal resources (such as retained earnings) or by converting partners' receivables from the company into capital; each method has different tax and accounting consequences.