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You still need the 25k to register a LLC or whatever the acronym is in Germany, right?
by nottorp 2y ago
You still need the 25k to register a LLC or whatever the acronym is in Germany, right?
- summarity 2y agoNo that's for a full GmbH. You can start with an "UG", which realistically needs maybe 1500 EUR to get registered and up and running. Then, a certain percentage of the profit is contributed towards the 25k (of which in turn only 12.5k have to be deposited in cash) each financial year. If the threshold is met, you can convert from UG to GmbH.
- zwnow 2y agoAlways go for GmbH. UG will make you account for everything with your private money. If something goes wrong in your business you'll be dirt poor.
- x2rj 2y agoYou are confusing UG with something like GbR. UG is basically a baby GmbH with constraints of the name of the company and how much money the associates can extract from it (until the company got 25k€ captial and can become a normal GmbH).
- dividuum 2y agoThat doesn't sound correct. UG is identical to the GmbH in that regard. Do you mean a GbR?
- zwnow 2y agoAhh might have confused it with one of the other forms then... It's been a while since I had to learn all that stuff.
- openplatypus 2y agoOnly up to 25k. UG allows you to incorporate for 1eur (600eur with accountant, notary, etc) and you are liable only up to level of full GmbH which is 25k.
- datavirtue 2y agoWhat a morass.
- ChadNauseam 2y agoThis sounds crazy to me. What is the €25k for? Hell, what is the €1.5k for? Is there some advantage to this system when compared to the US one where I can start an LLC for $35 or a C-corp for a couple hundred?
- tiluha 2y agoYou need 25k€ to register a GmbH, but you can nowadays register a UG which only requires 1€ and can later be converted to a GmbH
- harha 2y agoWhich will cost many thousands in admin per year
- b-mmxx 2y agoCan you elaborate on what you mean by that? Annual admin costs very much depend on how complex the business is, no? The primary recurring obligation for a UG is the mandatory retention of 25% of annual net profits until the share capital reaches €25k, enabling tax-neutral conversion to a GmbH. What I could think of for UG with idea on converting to GmbH, you could have: - UG setup cost (fairly low compared to GmbH) - UG/GmbH accounting & tax compliance - Commercial register updates - Notary fees for structural changes, and eventually the conversion process
- ido 2y agoI run a small (software) startup in Berlin, the administrative cost is more like €1000/year (of course increasing the bigger your business gets) .
- Propelloni 2y agoFirst, it is sufficient to only pay 50 % of the stock capital at registration of the GMbH, ie. 12500 EUR. Obviously you also have less operating capital then. Second, the money is not gone. It is right there in the company's account. You use it to pay company bills. The only thing annoying about German GmbH is that it can take 6-8 weeks until you get your tax id and registration numbers. You can, of course, already do business with the name postfix "i.G.", ie. instead of "Foobar GmbH" you write "Foobar GmbH i.G." and done. EDIT: typo
- nottorp 2y ago> Second, the money is not gone. It is right there in the company's account. You use it to pay company bills. That's fine if you start a restaurant or small workshop and need money for salaries, materials etc, of course. It's a barrier to entry when you can start something digital only with just a person or three putting in sweat equity and zero to very little actual cash.