Before we talk about the requirements to establish a sole proprietorship and the taxes to be paid afterwards, it is useful to define the sole proprietorship. Sole proprietorships are legal entities in which the responsibilities of the partners are unlimited. Partnerships established by one or more people due to common goals, where the decisions and responsibilities taken are considered personal, are called sole proprietorships.
Setting up a sole proprietorship is simpler, less expensive and faster than other types of companies. For this reason, it is highly preferred by people who are new to e-commerce-like businesses.
You can agree with a financial advisor to establish a sole proprietorship. It will send you detailed information about the required documents and payments. However, establishing a sole proprietorship is much faster than other types of companies. Generally, your legal entity is registered by making the necessary inspection within 2 working days according to the density of the region. The documents required for the establishment of the company are:
1. Financial Advisor power of attorney
2. Copy of title deed or lease contract
3. Copy of identity card
4. Passport photo
5. Signature statement
7. Vehicle purchase receipt and license (if any)
For company formation, you must present the company address to the tax office. The company address can be home, office, virtual office or shop. If the relevant immovable is for rent, the lease agreement, if it belongs to you, a copy of the title deed will be attached to the file together with the agreement you will make with the financial advisor.
Expenditures to be made for 2021 to establish a sole proprietorship are as follows:
1. 2 copies of identity cards
2. Employment form (can be filled via e-Government)
3. The lease agreement of the workplace or the title deed if the property belongs to the person
4. 2 residence addresses (can be obtained free of charge via e-Government)
5. 2 Signature declarations (Signature declaration can be obtained from any notary public. The average fee is 100 TL)
6. Tax office stamp duty (50 TL)
7. Financial advisor workplace opening fee (500-700 TL)
8. Cash register if you need (1000-1500TL)
9. Stamp (20TL)
Withholding is a type of tax paid for all commercial areas. 1/4 of the monthly tax amount is calculated as withholding tax and is paid in 3 monthly periods. This tax is not paid if it is not rented but owned by the person or leased from company to company.
What are the sole proprietorship expenses?
A tax return is established for everyone who is a taxpayer. In this context, the annual tax items of a taxpayer are as follows:
1. VAT declaration every month (58.80 TL stamp duty)
2. Withholding statement every 3 months (58.80 TL stamp duty)
3. Provisional income statement every 3 months (91.70 TL stamp tax)
4. Annual income tax return (122 TL stamp duty)
Unlike other capital companies, tax calculations of sole proprietorships are divided into stages according to their income. The details of the tax brackets varying between 15% and 40% are as follows:
1. Up to 22.000 TL: 15 percent,
2. 3,300 TL for 22,000 TL of 49,000 TL, the excess: 20 percent
3. 8.700 TL for 49.000 TL of 120.000 TL, (8.700 TL for 49.000 TL of 180.000 TL in wage incomes), surplus: 27 percent,
4. 27,870 TL for 120,000 TL out of 600,000 TL, (44,070 TL for 180,000 TL out of 600,000 TL in wage income), excess: 35 percent,
5. 195,870 TL for 600,000 TL of more than 600,000 TL, (191,070 TL for 600,000 TL of more than 600,000 TL in wage income): 40%
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