Company Formation

Establishing a company in Northern Cyprus requires a serious and careful approach. It is important to obtain expert support before commencing the process.

Limited Liability Company (LLC)

The preferred type of company in Northern Cyprus for TRNC citizens and foreign investors. An LLC requires a minimum of two partners, and TRNC citizens are not required to show registered capital. Foreign investors need to provide a letter of bank guarantee for 25,000 euros (previously 100,000 dollars). This amount is temporarily blocked during the procedure but can later be used for business operations.

The structure of an LLC includes a director and a secretary. The director, the responsible leader, has the authority to sign documents on behalf of the company. If the director is not a TRNC citizen, an amount equivalent to 12 times the minimum wage (for example, 25,000 Turkish lira multiplied by 12 months) must be deposited for 24 months as a tax security through a bank guarantee.

Opening a Branch in the TRNC:

Branches of foreign companies are regulated by the Ministry of Economy, requiring capital injection according to their regulations.

Branches of local companies, especially in the Famagusta Free Trade Zone, are exempt from corporate tax, income tax, and VAT, providing tax incentives. They are preferred for international shipping and IT companies.

Establishing a company in the Free Trade Zone requires an experienced financial consultant, especially valuable for those working abroad seeking tax advantages.

Requirements for establishing a company in the TRNC:

  • Registered capital is not required for TRNC citizens. Foreign investors are advised to deposit 50,000 euros in a bank and obtain a guarantee letter for unlocking after establishment.
  • You will need to pay a one-time fee for company formation and then a monthly fee for financial consultations, income, and corporate taxes.
  • Tax rates may change, so it is recommended to verify before establishing a company.
  • VAT in Northern Cyprus is 16%, with possible exemptions in certain sectors.

Business permits in the TRNC

Necessary for foreign company owners. The process is usually managed by a financial consultancy bureau. Documents include copies of founding documents, debt certificates, passport copies, company articles of association, and power of attorney.