A shareholder loan to a Turkish company may arise when an owner transfers money to the business or pays company expenses personally. The evidential problem begins when the purpose was not recorded. The company may later argue that the payment was unpaid capital, a capital advance, a share-purchase payment or reimbursement of another obligation. A shareholder loan should therefore be documented when funds move, not reconstructed after a dispute starts.
What is a shareholder loan under Turkish law?
The ordinary structure is a consumption loan under Articles 386-392 of Turkish Code of Obligations No. 6098. The shareholder provides a sum of money and the company undertakes to return the same amount at the agreed time. A receivable may also arise when the shareholder pays a supplier, bank or authority directly for a genuine company liability.
Not every owner payment is a loan. A transfer may satisfy unpaid subscribed capital. Money reserved for a future capital increase may be a capital advance. Consideration paid by one shareholder to another for shares is generally not a company debt. The true purpose, contemporaneous documents and accounting treatment must be consistent.
How should a shareholder loan be documented?
A written agreement signed by duly authorised company representatives is the strongest starting point. It should identify the parties, amount, currency, disbursement account, maturity, interest, default rules and repayment method. Where the trade registry requires joint signatures, a document bearing only one signature may not bind the company.
Article 200 of Civil Procedure Code No. 6100 applies a written-evidence rule to transactions over the statutory monetary threshold. Trust between shareholders and witness testimony should not be treated as a replacement for contemporaneous written proof. Emails and messages may support the case but should accompany a properly authorised agreement.
Can a bank transfer prove a shareholder loan?
A bank record is central evidence when money moves from the shareholder’s personal account to the company account. The payment description should state its purpose, such as “repayable shareholder loan.” A transfer with no explanation may, depending on the surrounding facts, be treated as payment of an existing obligation rather than a new loan.
Where the shareholder pays a third party, the file should include an invoice addressed to the company, the underlying company contract, and a written payment instruction or approval. A personal credit-card statement proves that the shareholder paid, but the invoice and business purpose establish why the company must reimburse that payment.
Is a shareholder loan account sufficient evidence?
Articles 64-88 of Turkish Commercial Code No. 6102 require commercial books to show transactions, financial position and creditor-debtor relationships clearly, with supporting documents preserved. Recording a balance in a shareholder current account (ortaklar cari hesabı) is important, but the entry should be traceable to a contract, transfer or invoice.
Under Article 222 of Code No. 6100, books favour their owner only when they are properly kept, required opening and closing certifications exist, and the records are internally consistent and compatible with the other party’s evidence. An unsupported or fictitious unilateral entry may fail.
In a 2022 case, the 11th Civil Chamber of the Turkish Court of Cassation upheld rejection of a former shareholder’s claim because the current-account entries had no supporting documents and the account had been used fictitiously. In a 2024 case involving alleged cash advances and personal-card expenses, only the documented portion was accepted. These decisions show why books and external evidence must form one chain.
What documents create a strong shareholder loan file?
The evidence should ideally include:
- A loan agreement signed under the registered representation rules,
- A board or managers’ resolution approving the borrowing,
- A bank transfer with a clear description,
- Company invoices and payment instructions for third-party payments,
- Proper commercial books and journal entries,
- A signed balance confirmation or debt acknowledgment,
- A repayment schedule and evidence of partial repayments,
- A notarial demand after maturity.
The file should be coordinated with Turkish commercial and corporate law and accounting requirements. If the lender is also a director, authority, conflict-of-interest and self-dealing rules need separate attention.
How are interest and repayment date determined?
The agreement should state the rate, calculation period, payment dates and treatment of default. Turkish law has particular rules for commercial loans, but leaving the terms unstated creates avoidable disputes. Tax and withholding consequences should be reviewed with tax advisers before funds are advanced.
If no repayment date, notice period or immediate-demand term was agreed, Code No. 6098 provides a waiting period following the first demand before repayment becomes due. The content and service date of the demand are therefore important.
What can the shareholder do if the company does not repay?
The first step is to assemble the agreement, transfers, invoices, books, acknowledgments and partial payments, then calculate principal and interest. A notarial demand can identify the amount, maturity, legal basis and payment account. If payment does not follow, the shareholder may consider ordinary enforcement proceedings or a debt action.
When the company objects to enforcement, additional litigation may be needed to overcome the objection. Mandatory mediation, jurisdiction, limitation periods, interest start date and the company’s solvency should be assessed before filing. Proceedings can take longer when bank records, corporate books and an accounting expert are required.
What mistakes most often undermine a shareholder loan?
Common mistakes include handing over cash, leaving the bank description empty, relying on an unauthorised signature, keeping invoices in the shareholder’s name and posting the account years later. Another risk arises at exit: a share-sale agreement stating that the parties have no further claims may be drafted broadly enough to affect a separate loan.
Shareholders should also avoid mixing personal and company accounts. Repeated undocumented transfers in both directions make it difficult to identify which payment created, repaid or set off the debt. Regular balance confirmations can prevent that uncertainty.
Frequently asked questions
Does a balance-sheet entry prove the debt by itself?
Not always. It is relevant evidence but should be supported by an agreement, bank movement, source documents and properly maintained books.
Can a cash shareholder loan be recovered?
Recovery may be possible with sufficient lawful evidence, but the absence of a transfer and written agreement creates substantial risk.
Is an unexplained bank transfer enough?
It is not conclusive. The purpose should be demonstrated through the agreement, correspondence, company acknowledgment and accounting records.
Does the loan end when the shareholder sells the shares?
A personal loan is normally separate from share ownership. However, release, set-off and full-settlement wording in the share-sale documents must be reviewed carefully.
This article provides general information on Turkish law and is not legal advice. Each shareholder loan claim requires review of its documents, authority and accounting records.
