Payroll in Turkey: How to make the right choice?

Did you know that you can opt for Payroll in Turkey, in the case you are an expat in this country ?

But already, what is Payroll in Turkey ?

Suppose a company producing mobile phones is based in China. This same company wants to sell its products in Turkey, but for that it needs a local collaborator who can market its phones.

We agree, opening a legal structure in Turkey just to hire an employee is an expensive and tedious process. In addition, you have to be aware of Turkish legislation in terms of labor law, company creation, etc. So why not go directly through a payroll company? They are there to facilitate your activities in Turkey. What is the advantage of going through a payroll company in Turkey?

It recruits your employee within it
She publishes her employment contract
She pays her salary and Turkish social security contributions
She takes care of all her other administrative procedures
In the event of breach of contract and dismissal, she manages all tasks relating to the exit of the employee

Concretely, the payroll company takes care of everything for you on site! As a manager you have absolutely nothing to do, except to manage your employee remotely. The umbrella company is remunerated by taking a commission indexed to the salary.

Payroll in Turkey: my own experience

As an expat, I contacted several umbrella companies.
I chose the company Azkan Group because it is the only player that has offices in both Paris and Istanbul, it is a guarantee of seriousness vis-à-vis the employer in France. And above all, it is the pioneer of payroll for French companies (existence since 2005).

Other advantages of Azkan Group:

• Hyper responsive customer service
• A mutual
• A retirement savings plan
• Formations

Payroll company, is it the right choice?

Joining a payroll company in Turkey is easier, faster and cheaper than creating your own structure.
There are fewer administrative tasks to deal with as the Umbrella company in Turkey handles invoicing, payroll and most of the other time-consuming tasks that you would have to do if you run your own company.
Plus, you get sick pay, vacation pay, and other statutory benefits.

The steps to follow for the implementation of Payroll company

Think of these basic steps as a roadmap for your porting process. If you’re experienced with payroll and need a quick refresher, this first set of steps can help.

The points that require your attention in your search for an umbrella company

Check that porting is the right solution for you

Creation of a holding company? Which structure to go through? Make sure that when choosing between these options, you choose a solution that best suits your needs. Explain your situation to both the umbrella company and an outsourced accountant for advice on which option is best for you.

Check your payroll company closely

If porting is right for you, be sure to check the company’s track record, including its reputation in the local community.

Make sure you have an overview of costs

Not all umbrella companies are transparent about their fee structures, so find out exactly how much you will be charged monthly. Before joining a carry program, check to see if fees are fully included or if you have to pay for extras, such as processing expenses, filing tax forms, and administration fees. If it’s a free service, ask the umbrella company how they do it.

Make sure you receive a full employment contract

You should receive a full employment contract from the umbrella company and receive all statutory rights and benefits that Turkish employees are entitled to.

Learn about the expense claim process

As soon as the contract is signed, ask the umbrella company for the reimbursement process for your monthly expenses. By what date do you have to send your fees? When will they be refunded to you? Are they reimbursed with the payment of your salary?

How and when is your salary paid?

Verify that the company pays you within a reasonable time of submitting your work schedules. You must be eligible for minimum wage, vacation and sick pay, which is yours by right.

List your interlocutors!

Unexpected ? A change in your working hours? A document request for the renewal of your work permit (ikamet) or obtaining a credit? Or simply a question about your contract? It is important from the start that you identify the right contacts within the payroll company capable of providing you with the appropriate services. Remember, the responsiveness of your interlocutors proves the level of seriousness of the payroll company.

Make sure that the company carrying you follows these steps:

• Obtaining an employer identification number
• Establishment of Turkish tax IDs
• Collection of tax and financial information from employees
• Implementation of a payroll schedule
• Establishment of tax payment dates
• Review processing of employee schedules
• Determination of overtime pay
• Calculation of gross salary.
• Calculation of charge deductions
• Calculation of the net salary
• Issuing payments to employees through their preferred method (eg paper check, direct deposit, wire transfer…)
• Edition of payslips

Important Note

Check for calculation errors (unfortunately it happens!)

Why Turkey for your expatriation project?

According to Coface, Turkey has strengths such as:

Accelerated economic growth following the COVID-19 period

• Major geo-strategic location, with proximity to the main export markets: Eastern Europe, Middle East, North Africa, Caucasus, Central Asia

• Dense industrial sector, real local know-how in multiple sectors such as automotive, household appliances, textiles, construction, etc.

• Young population, educated workforce: more than 400,000 Turks are Bac+5 each year. The level of universities is the most developed in the region.

You will have access to economic data on the attractiveness of Turkey on the World Bank website, and the government agency dedicated to investment: Invest in Turkey.

Commonly called “Payroll in Turkey” by expats in Turkey, you would have understood that umbrella company in Turkey offers many advantages.