Do Foreigners Need to Pay Social Security When Starting a Company in Turkey? (2025 Guide)
Do Foreigners Need to Pay Social Security When Starting a Company in Turkey? (2025 Guide)
Do Foreigners Need to Pay Social Security When Starting a Company in Turkey? (2025 Guide)
Introduction
Are you planning to start a business in Turkey?
If so, you might be wondering:
Do foreigners have to pay social security premiums, and what exactly is Bağ-Kur?
This guide explains everything you need to know about social security obligations, exemptions, and compliance for foreign entrepreneurs in Turkey.
Social Security and Bağ-Kur: What Foreigners Should Know
When foreigners establish a company in Turkey and work independently, they are generally subject to Turkey’s self-employment social security system, called Bağ-Kur (4/b coverage).
However, not every foreign national must register and pay Bağ-Kur premiums.
There are two major exemptions:
1. Already Covered by a Foreign Social Security System
If you are already insured under your home country's social security system and can officially prove it, you are exempt from Bağ-Kur registration in Turkey.
This is applicable under international social security agreements.
2. Living Abroad
If you reside outside Turkey and are still covered by your home country’s social security system, you are not required to pay Bağ-Kur premiums, even if you own a Turkish company.
Company Types and Social Security Obligations
| Company Type | Bağ-Kur Obligation | Key Notes |
| Limited Liability Company (LLC) | Managing directors must obtain a work permit and may need Bağ-Kur if residing in Turkey. | Passive shareholders (non-directors) are exempt. |
| Joint-Stock Company (JSC) | Only resident board members may be subject to Bağ-Kur. | Board members living abroad are not obliged. |
Important:
Even if you are exempt from Bağ-Kur, you still need to comply with tax filings, accounting, and company obligations in Turkey.
Practical Considerations
Always document your foreign social security coverage properly.
Check with the Turkish Social Security Institution (SGK) to confirm your exemption.
Work permit requirements are separate and must be evaluated individually.
Conclusion: Ensure Compliance Before You Start
Whether you must pay Bağ-Kur premiums depends mainly on your residency status, your current insurance coverage abroad, and your role within the company.
Need help setting up your company in Turkey and managing your social security obligations?
We can provide tailored solutions for foreign entrepreneurs.
👉 info@ozmconsultancy.com
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About the author
- Evren Özmen is an Istanbul-based CPA / SMMM specializing in tax and accounting for remote workers, freelancers and professionals earning income from foreign clients. His practice has supported more than 1,000 remote-working taxpayers. Core topics include employee versus contractor classification, foreign-client invoicing, VAT exemption for exported services, service export deductions, sole proprietorship and limited company compliance. General information only; case-specific review is required before applying any tax position.
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