What is a GmbH & Co. KG?

updated on 20. February 2023 10 minutes reading time
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With so many abbreviations, the GmbH & Co KG can be confusing. Even if you know what a GmbH or a KG is, it’s not clear what a GmbH & Co KG exactly is. Read this article and get an overview of the GmbH & Co KG legal form including the definitions of “Kommanditgesellschaft” (limited partner), “Komplementär” (general partner) and other key terms.




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What does the abbreviation GmbH & Co KG stand for?

GmbH & Co KG stands for Gesellschaft mit beschränkter Haftung & Compagnie Kommanditgesellschaft, or in English, ‘limited liability company & limited partnership’.

What is a GmbH & Co KG?

In German corporate law, as the name suggests, the GmbH & Co. KG is a hybrid of the legal forms the GmbH (Gesellschaft mit beschränkter Haftung – a limited liability company legal form) and the KG (Kommanditgesellschaft – a limited partnership legal form). But, despite this hybrid form, the GmbH & Co. KG is still a KG (limited partnership) and, therefore, is categorised as a partnership (Personengesellschaft).

The KG legal form has a natural person as the general partner (called a Komplementär) who has unlimited liability in the business structure. But, for the GmbH & Co. KG, the general partner is not a natural person but rather a limited liability company. This GmbH is liable only with its corporate assets. If the second general partner in the GmbH & Co. KG is also a limited liability company (and not a natural person), both partners now have limited liability.

The shareholders of the GmbH & Co KG

In connection with the legal forms KG and GmbH & Co KG, the terms “general partner” and “limited partner (Kommanditist)”, which describe the different forms of the partner, are frequently used. firma.de has drawn up a short definition for you:

What is a general partner of the legal form GmbH & Co KG? – A definition

A general partner is the partner of a limited partnership (KG) who has unlimited personal liability. In a GmbH & Co. KG, the general partner is a GmbH. This has the advantage of not being a natural person who is personally liable, as is the case with the general partnership, but a legal entity like the GmbH. The GmbH is liable with its complete business assets.

What is a general partner of the legal form GmbH & Co KG? – A definition

The limited partner is a partner in a limited partnership (KG), however, his or her liability is usually limited to the amount of liability entered in the commercial register.

What should be considered when forming a GmbH & Co. KG?

The formation of a GmbH & Co. KG requires at least one personally liable partner and one associate. First, the shareholders establish a GmbH (limited liability company). If it’s entered in the Commercial Register (Handelsregister), the GmbH & Co. KG can then be founded.

The articles of association (Gesellschaftsvertrag) or the charter define the basis of the GmbH & Co. KG. If this is also entered in the Handelsregister, the full limitation of liability for the general partners comes into force.

Be careful: The company already holds legal capacity before it’s entered in the Handelsregister, only the limited partners are liable up to this point in time also with their private assets.

The minimum capital that must be contributed to a GmbH & Co. KG is €25,000. Material assets can also be contributed.

What makes the GmbH & Co. KG an attractive legal form for founders?

One advantage of the GmbH & Co KG, among others, is the fact that the GmbH assumes the role of the general partner in the KG. As already mentioned above, the GmbH is liable as a corporation with the full company assets, but not with the private assets of the partners. Liability risks for the persons involved in the company can thus be greatly limited.

A further advantage of GmbH & Co. KG: The GmbH is also responsible for the management of the partnership.

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What is meant by the “Zweck” (purpose) of a GmbH & Co. KG?

The purpose of a GmbH & Co. KG can either be the operation of a commercial enterprise or the management of its own assets.

The partnership agreement of a GmbH & Co. KG

The shareholders define the legal basis of GmbH & Co KG in the articles of association. It’s also possible to amend requirements laid down by the German Commercial Code, such as voting rules for shareholders or the distribution of profits.

Managing a GmbH & Co. KG

The management of the GmbH & Co. KG holds the GmbH. However, since a limited liability company is not a natural person, the company itself may not be a managing director. Therefore, the managing director of the GmbH is also indirectly managing director of the GmbH & Co. KG. By the way, the management of a GmbH does not necessarily have to be staffed by one of its shareholders; it can also be an external person.

The GmbH & Co. KG and taxes

A GmbH & Co. KG must pay the following taxes:

  • Income taxes (Einkommenssteuern) – limited partner (Kommanditist)
  • Corporate income taxes (Körperschaftssteuern) – general partner or limited liability company (Komplementär or GmbH)
  • Value added tax (Umsatzsteuern) – if necessary, also the limited partner (Kommanditist) as managing director (Geschäftsführer)
  • Trade taxes (Gewerbesteuern)
  • Real estate transfer tax (Grunderwerbssteuern) – if a property is purchased for the entire property or for the limited partner if he or she buys a property for the special area requiring a special balance sheet (Sonderbilanz); with a few exceptions
  • Inheritance tax/gift tax (Erbschaftssteuern/Schenkungssteuern)
  • Wage tax (Lohnsteuer) – for employees


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Still got questions about setting up a business in Germany?

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Hi, I’m Andreas and I’ve been advising businesses in Germany for over a decade. I’d be happy to call you and answer any questions you have in a one-on-one consultation.

Want to know about other legal forms in Germany?

The GmbH & Co KG is a less common legal form in Germany. More popular legal forms are:


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