Company Formation in Germany

How long does it take to form a company in Germany?

The incorporation process of a GmbH takes about 20-30 working days.

Procedure to prepare the registration of a company in Germany

The registration process for a company in Germany is very simple. The experts of LegalBison will assist you throughout every step of it:

• Initial consultation and agreement;
• Payment of the full invoice;
• [IF REMOTELY]: Notarization of POA by client;
• Preparation of registration documents;
• Document signed at the notary;
• Official register validity: immediately.

Can I form a company in Germany remotely?

The whole incorporation process can be conducted remotely. No travel necessary. Notarization of documents is necessary.

• A Power of Attorney (POA) from (all) partners/shareholders is needed;
• The POA is sent to you by us based on the services you want;
• You have to certify the POA by a notary and in some cases legalize it by apostille (some countries need full legalization);
• Once you have the POA on your hands, we double-check, and you send us the original form (physical document!) via courier to our address;
• Germany is part of the Hague Convention of the Apostille.

Necessary information to begin with company formation in Germany

• 3 options of your desired name for the company and a company contact email address;
• Names, addresses, and emails of all shareholders and board members;
• Short description of your company’s activity.

Without VAT number in Germany

Your company will not be eligible to receive VAT refunds, which means everything bought is 19% more expensive (important: B2B payments between two VAT-exempt companies are not more expensive).

Your company will not have to file monthly tax returns (prerequisite: no one receives a salary), which means low costs.

With VAT number in Germany

• A limited liability company (GmbH) can apply for a VAT number through an online procedure;
• Companies involved in the domestic trading of goods are required to register for VAT;
• The company will be eligible to receive VAT refunds, which means you can make use of the reverse-charge mechanism;
• Monthly tax returns have to be filed, even if no transactions occur.

Required documents to provide to register a company in Germany

• Passport copies (scans) of shareholder/s and director/s, also a beneficiary owner if applicable;
• A Power of Attorney (in case of a remote company registration);
• Certified company documents (in case at least one of the shareholders is going to be a foreign company).

Taxation of companies in Germany

German business profits are subject to two taxes: corporation tax and trade tax. Together, they add up to approximately 30% or higher.

The national corporate income tax rate in Germany is 15% of the taxable income (annual profits).

The effective corporate income tax rate, including subnational and trade taxes, is 29,9%.

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DTAA signed by Germany for companies

Many countries have bilateral conventions to avoid double taxation and prevent fiscal evasion.

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Accounting and audit requirements for a company in Germany

German limited liability companies are required to provide yearly returns, including financial statements, accounts, and annexes. The document package, known as “Jahresabschluss”, can be filed online.

Past a certain threshold of turnover (12 M EUR), on the balance sheet (6 M EUR), or the number of employees (50), an annual audit becomes mandatory for a GmbH.

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Economic substance and residency requirements for companies in Germany

There are no residential requirements for managing director(s) nor shareholder(s), who can be the same single person. A registered office in Germany is necessary for incorporation.

LegalBison offers help with the above requirements. We assist and are local in the country. Speak now for free with one of our consultants to get your business started.

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