GmbH formation: Kickstart your business with firma.de
Focus on growth right from the start.
- Get up and running as quickly as possible
- Incorporate your company without navigating German bureaucracy
- Receive ongoing support from a dedicated consultant
- bookkeeping
- annual accounts
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one-time*
A dedicated consultant
On demand telephone support
Contract and document templates
Checklists and form pre-filling
Coordination and referrals
Subsidiary formation services for foreign companies
Employer identification number
EORI number
Formation services for international founders (Non-EU)
Individual GmbH articles of association from a lawyer optionally selectable in the shopping cart**
Visa consultation
Protect your brand, company name and logo in Germany
Protect your company’s most valuable asset with an EU trademark
Digital handbook for founders: Firma gründen (currently only available in German)
ebuero 500 € credit for calls in the first month
one-time*
Express formation + registration
A dedicated consultant
On demand telephone support
Contract and document templates
Checklists and form pre-filling
Coordination and referrals
Subsidiary formation services for foreign companies
Employer identification number
EORI number
Formation services for international founders (Non-EU)
Individual GmbH articles of association from a lawyer optionally selectable in the shopping cart**
Visa consultation
Protect your brand, company name and logo in Germany
Protect your company’s most valuable asset with an EU trademark
Digital handbook for founders: Firma gründen (currently only available in German)
ebuero 500 € credit for calls in the first month
one-time*
Direct line to the firma.de executive team
Set up of financial accounting €100 (plus preparation of annual accounts for €1.249)
Set up of bookkeeping services Starter
A dedicated consultant
On demand telephone support
Contract and document templates
Checklists and form pre-filling
Coordination and referrals
Subsidiary formation services for foreign companies
Employer identification number
EORI number
Formation services for international founders (Non-EU)
Individual GmbH articles of association from a lawyer optionally selectable in the shopping cart**
Visa consultation
Protect your brand, company name and logo in Germany
Protect your company’s most valuable asset with an EU trademark
Digital handbook for founders: Firma gründen (currently only available in German)
ebuero 500 € credit for calls in the first month
Net prices
Articles of association drafted by a lawyer: Protect yourself and your business partners
Classic | Express | GmbH All-In | ||||
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firma.de | ||||||
Direct line to the firma.de executive team | ||||||
Set up of financial accounting €100 (plus preparation of annual accounts for €1.249) | ||||||
Set up of bookkeeping services Starter | ||||||
Express formation + registration | ||||||
A dedicated consultant | ||||||
On demand telephone support | ||||||
Contract and document templates | ||||||
User friendly opening balance sheet template | ||||||
Employment contract template (part-time) | ||||||
Employment contract template (full-time) | ||||||
Temporary personnel contract template | ||||||
Internship contract template | ||||||
Loan contract template | ||||||
Freelancer contract template | ||||||
Letterhead, legal disclosure and invoice templates | ||||||
Checklists and form pre-filling | ||||||
Completion of the trade registration form (Gewerbeanmeldung) | ||||||
Coordination and referrals | ||||||
Timely preparation of your Trade registration (Gewerbeanmeldung) | ||||||
Coordination of all necessary legal formalities | ||||||
Timely preparation of your tax office questionnaire (Finanzamtfragebogen) for the application of your VAT ID (USt.-ID) | ||||||
An expert consultant to guide you through the process | ||||||
Referral to a qualified tax adviser in your area | ||||||
Subsidiary formation services for foreign companies | Optional | Optional | Optional | |||
Employer identification number | Optional | Optional | Optional | |||
EORI number | Optional | Optional | Optional | |||
Formation services for international founders (Non-EU) | Optional | Optional | Optional | |||
Lawyer Steffen Hartmann | ||||||
Individual GmbH articles of association from a lawyer optionally selectable in the shopping cart** firma.de Firmenbaukasten AG does not provide legal advice itself but works exclusively with lawyers and independent tax advisers who specialise in the field of limited liability entrepreneurial companies | Optional | Optional | Optional | |||
Visa consultation firma.de Firmenbaukasten AG does not provide legal advice itself; firma.de works exclusively with lawyers and independent tax advisors who specialise in the field of limited liability entrepreneurial companies | Optional | Optional | Optional | |||
ETL IP Patent- und Rechtsanwaltsgesellschaft mbH | ||||||
Protect your brand, company name and logo in Germany Provision of legal services is by ETL IP Patent- und Rechtsanwaltsgesellschaft mbH, Clayallee 343, 14169 Berlin. | Optional | Optional | Optional | |||
Protect your company’s most valuable asset with an EU trademark Provision of legal services is by ETL IP Patent- und Rechtsanwaltsgesellschaft mbH, Clayallee 343, 14169 Berlin. | Optional | Optional | Optional | |||
Other Services | ||||||
Digital handbook for founders: Firma gründen (currently only available in German) | Optional | Optional | Optional | |||
ebuero 500 € credit for calls in the first month | Optional | Optional | Optional | |||
389€ excluding tax | 539€ excluding tax | 528€ excluding tax | ||||
Start | Start | Start |
Note:
The notary fees and the costs for entry in the commercial register (Handelsregister) are not included in the price and will be charged separately.
** firma.de Firmenbaukasten AG does not provide legal advice itself but works exclusively with lawyers and independent tax advisers who specialise in the field of limited liability entrepreneurial companies. Please make an appointment: +49 611 17207-0 or by e-mail at support@firma.de
Tax savings
Compared to sole proprietorships or business partnerships, the GmbH has a much lower tax rate for undistributed profits. This is why the GmbH is considered a good tax-saving model.
No personal liability
GmbH shareholders are not liable for company debt with their private assets (e.g. house, car, bank accounts) even in the case of insolvency. For many founders, this is the most important benefit of the GmbH corporate structure.
Enhanced credibility
Forming an GmbH can help establish credibility with potential customers, employees, vendors and partners because of the perceived status of the company type.
"Many of the actors that can help young founders form companies in Germany either charge high hourly rates or want equity for their time and effort. firma.de’s services have fixed-prices because it’s a company by entrepreneurs for entreprenuers." Xibit
See all customer storiesA limited liability company, such as the GmbH, is your perfect match if you want to protect your personal assets and are able to raise the necessary capital share of €25,000.
This corporate form also offers other advantages such as tax benefits and the public image of a fully-fledged company.
Hybrid corporate forms such as GmbH & Co. KG or the non-profit variation gGmbH are also limited liability options.
The abbreviation GmbH stands for Gesellschaft mit beschränkter Haftung, which translates to 'company with limited liability'.
All liabilities are covered by the company rather than the personal assets of its shareholders.
The corporate form is widespread in Germany and can be best compared to the US-American LLC, the British Inc. or Ltd and the Australian Pty, to name a few.
GmbH shareholders need to put up a minimum of €25,000 share capital.
The share capital can be contributed by several shareholders and has to be provided after the formation but before registering your company with the commercial register (Handelsregister).
How exactly the individual shares are divided among the shareholders is regulated in the articles of incorporation. The shares must be paid in as cash deposits or contributions in kind.
If you are unable to raise the minimum capital requirement of €25,000 to form a GmbH, your best alternative is the UG (haftungsbeschränkt) - colloquially known as the 'Mini-GmbH' or '1-Euro-GmbH'.
The UG is a special variation of the corporate form GmbH and caters to the needs of startups with limited starting capital that still want to benefit from limited liability.
The minimum capital requirement is only €1 per shareholder.
The 'Mini-GmbH' is the corporate legal form Unternehmergesellschaft (haftungsbeschränkt) — commonly known as the UG.
The UG is a limited liability structure that caters to the needs of startups that have restricted starting capital (the minimum share capital is only €1.00 per shareholder) but still want to benefit from limited liability.
The UG is not a corporate form of its own, as frequently assumed, but is a variation of the regular GmbH, which was created by the legislation to Modernise the Law on Limited Liability Companies and to Combat Abuse (Modernisierung des GmbH-Rechts und zurBekämpfung von Missbräuchen [MoMiG]) in 2008. And, why the name Mini-GmbH comes from
Since its introduction, the UG enjoys enormous popularity among founders with more than 200,000 being formed already — a number that is steadily growing.
Tax savings
The GmbH offers a much more favourable tax rate in comparison to sole proprietorships or business partnerships regulated by the German Civil Code, making it an ideal corporate form to reduce taxes.
(It's important to note that the income of the managing directors of a GmbH, like an employee, are taxable at the personal income tax rate.)
No personal liability
As a GmbH founder, you are not liable for damages with your private assets (e.g. your house, car, bank accounts and deposits) for company debt - this rule applies even in the event of an insolvency.
Greater tax relief thanks to 'hidden reserves'
Another way to enjoy favourable tax regulations is via so-called 'hidden reserves' ('stille Reserven') which are company-owned assets that have a lower 'book value' than its market value.
As long as these 'hidden reserves' remain company assets, they are exempt from taxation.
Freedom to nominate managing directors
The shareholders are free to choose one or several managing directors.
Whether the shareholders act as managing directors themselves or decide to employ an external managing director is a matter choice.
Creation of a legal entity
The GmbH is an independent legal entity that can conduct business and enter into contracts as a person would.
The managing director is the legal representative of the company and can enter the company into contracts on its behalf.
The GmbH is taxable at the corporate tax rate, which is considerably lower than the personal income tax rate.
For example, sole traders are subject to income tax, which can be up to 45% of their taxable income. Whereas the total tax burden of a GmbH - including both the corporate and the solidarity surtax (Solidaritätszuschlag) - is 15.825%.
Comparing these rates makes it is easy to understand why entrepreneurs find the GmbH so attractive.
As opposed to partnerships or sole proprietorships, the GmbH generally is only liable for damages with its assets. The personal assets of its shareholders are off limits. There are a few exceptions to this rule, which we explore below.
If the assets of the GmbH amount to less than €25,000 before its entry into the commercial register (Handelsregister), the company as a legal entity can claim the missing share capital from all its shareholders. In this case, the GmbH's creditors have the right to full payment from the shareholders’ private assets. Failure to meet the minimum share capital requirement may jeopardise the limited liability of the company.
If a GmbH has lost its assets because of illegal actions by its shareholders, an extraordinary form of liability applies. This situaiton invokes a liability for the destruction of economic basis and allows an insolvency administrator to make claims on the shareholders' private assets.
If the shareholders do not fulfil their legal obligation to act in the best interests of the GmbH, they no longer have limited liability.
If the Gmbh does not meet its tax obligations, the managing director is personally liable for damages.
If the company started business operations before its entry into the commercial register (Handelsregister), the shareholders are also entirely liable for damages with their private assets.
It is essential that the shareholders and managing directors of a GmbH are chosen and appointed as early as possible.
Beyond a certain company size, a supervisory board is required by law.
GmbH shareholders are the owners and the decision-makers of the company. During the general shareholders' meeting, they vote on all major business decisions.
There is no shareholder minimum or cap for a GmbH.
If you want to use the Musterprotokoll (the government issued standardised template) for your company's articles of association, the number of shareholders is limited to three - any amount above this requires a customised version.
All business-related decisions are made during the GmbH general shareholders' meeting.
Alternatively, if there is consensus, shareholders may opt to make decisions via written resolutions.
The shareholders can appoint one or more managing directors (MD).
The MD is the company's representative. His or her task is to manage the business and pursue the shareholders' interests as set out in the articles of association.
Shareholders themselves can also serve a double function as a MD. If the shareholder holds a majority stake in the company as well as being an MD, it is preferable that the GmbH officially employees him or her as an employee.
To directly control the management of your GmbH, you can specify the formation of a supervisory board in your articles of association. A supervisory board is only obligatory for companies that have more than 500 employees.
A supervisory board consists of at least three people, and the ratio of employees to employers must be 1:2. It is possible to include more members of the supervisory board if specified in the articles of association, but in any case, the number of supervisory board members must be divisible by three. For example, from a company size of 2,000 employees, at least 12 supervisory board members are required.
Your GmbH needs to have an official corporate name. You can choose a name inspired by your name, the sector, your corporate purpose (or business branch) or make something up. In every case the name suffix “GmbH” is mandatory, so your chosen corporate form is transparent to the public.
The four options are explored in greater detail below:
Name your company after a person
It is common to use the names of one or more co-founders as a company name, e.g., "Franklin Smith GmbH."
Create a fantasy name for your company
You may invent a word to serve as your company name, e.g., "Bribotaz GmbH".
Describe what your company does
Use a description of the purpose or the activity of your company, e.g. "Steve Baker's Online Children's Book GmbH" if you are selling children's books online.
Use a combination of the above options
You can combine two or more options, e.g., "Rompostomp – Frank Smith’s Online Book Store GmbH" or "Bribotax – Jill Reagan‘s Party Service GmbH".
Before you incorporate a GmbH, you should choose your company name carefully. Something to consider is the fact that many founders use fantasy terms that are not only unique - and thereby avoid copyright issues - but also pronounceable in as many languages as possible.
Most importantly, make sure your company name only has positive connotations. Always consider your future customers before you make a final decision.
Your company name has to meet two conditions: it has to characterise your business and distinguish it from other companies.
Your name choice must also not contain any statements that are misleading - something that the district court has ultimate authority over.
All the essential information about the GmbH gets recorded in the articles of association, and must include the following information as illustrated by the below example:
The articles of association of your GmbH have to be authenticated by a notary, who also issues the certificate of incorporation. Then, a list of shareholders needs to be drafted and signed by all partners. Finally, your data is transmitted electronically to the commercial register (Handelsregister).
The registration at the commercial register (Handelsregister) is only possible if these requirements have been met:
You can significantly accelerate the incorporation process by using a model protocol (Musterprotokoll) if these following conditions are met:
If GmbH company assets sink below € 25,000 before its entry into the commercial register (Handelsregister), it is considered to be undercapitalised.
In this event, the GmbH may claim liability from its shareholders, allowing creditors to collect damages from the shareholders’ private assets as well. This situation is called a short balance liability (Unterbilanzhaftung)
Careful financial planning is essential to avoid this short balance liability.
If a GmbH has lost its company assets due to negligence or wrongdoing of the shareholders, there are grounds for liability, which is called Existenzvernichtungshaftung in Germany. In this case, an insolvency administrator decides whether or not to remove the limited liability of the shareholders.
Liability due to Existenzvernichtungshaftung is based on the shareholders' obligations to protect the company’s financial interests.
If a GmbH does not comply with tax laws and regulations, the managing directors become personally liable for any damages.
If the non-compliance occurs before the company's entry into the commercial register (Handelsregister), all the shareholders are liable for damages with their private assets.
If one of the shareholders defaults on his or her share capital, the remaining shareholders have to absorb the loss, and deposit the missing amount proportionate to their respective share percentage.
GmbH
We explain what a GmbH is and what it costs.
Pros and cons
Of the German limited liability company (LLC)
Company name
How to find the perfect name for your UG or GmbH
Timing
When to form a UG or GmbH
Master list
Business Management
Company names
Is my company name still available in Germany?
Master list
Accountancy
EÜR
Everything you need to know about the Einnahmenüberschussrech-nung
Lohnsteuer
Get to know all about wage tax in Germany
Jahresabschluss Checklist
How to manage your end-of-year accounting
Forming a GmbH (LLC)
How to set up a GmbH in Germany
Forming a UG (LLC)
How to set up a UG in Germany
Registering a company
Company formation in Germany: A checklist
Opening a bank account
Advice for founders w/o a German passport
Capital gains tax in Germany
Definition, calculation, exemptions and more
Annual Finan- cial Statement
What to know about the AFS in Germany
German payroll abbreviations
All important payroll abbreviations explained
What is tax deductible?
Tips for entrepreneurs and business owners
German company name
Is your preferred name available and lawful?
Finding investors
How to approach investors in Germany
Self-employed with a side job?
This is how you navigate health insurance
Protect your company name
How to register a trademark in Germany