Introduction to setting up a Company in Germany
Germany has a central location in Europe as well as a strong economy which makes it conducive to business. Trade and commerce in the country is regulated by the Commercial Code (HGB) and the Civil Code (BGB). Foreign subsidiaries are treated equally with domicile companies, but special authorisation may be required for particular trades.
What are the main requirements for a German Company?
– The minimum share capital required for a GMbH is €25,000
– The Memorandum & Articles of Association of the subsidiary
– The resolution of the parent company detailing its decision to form the subsidiary
Registration of the subsidiary requires the above documents to be filed with the German Commercial Register.
All required documentation must be officially notarised.
What are the accounting requirements of a German Company?
Registration of the subsidiary with its local Tax Office is required for taxation purposes. This can be completed online through the Federal German Fiscal Authority’s Form Management System (FMS).
Tax declarations for the payroll and VAT of the subsidiary must be filed. In the founding year, VAT accounts must be submitted monthly – in the following years periodic returns are dependent on the annual turnover – and an annual declaration must be made at the end of the year.
The Tax Office determines advance payments from the amount of profit mentioned at registration and tax returns are generally due by May 31 of the following year.
A German special savings bank account must be set up to deposit the required share capital next to a normal checking account.
Please contact us in order to discuss your accounting requirements.
We will handle every aspect of the Company formation for you. Using our expert knowledge we can offer a company formation package in which we take care of company registration, issue of the certificates of registration, local directors, local representative and place of business in Germany, tax registration, VAT registration, and translation of documents into German.
Our unique one stop solution for all European formation requirements also offers formation packages to set up multiple companies. The benefits for establishing multiple companies include further increased exposure and global presence, and we can organise everything for you.
A summary of Germany Corporate Taxes is available here.