Opening a company in Germany in 2023

Opening a company in Germany in 2023

Opening a company in Germany in 2023 is an opportunity to do business in a country that boasts one of the most developed economies in the world. Among the advantages are political and social stability and low corruption. The country offers preferential programs for small and medium-sized businesses, and banks provide long-term loans at low interest rates.

Is it difficult for foreigners to register a business in Germany?

Citizens of the EU, Switzerland or Norway, can easily open a company in Germany, once they are registered as a resident. If a foreigner is not an EU citizen, before opening a company, he must obtain a visa and a residence permit to work not for hire in Germany.

Basic forms of legal entities in Germany

Before opening a company in Germany, deciding on the form of a legal entity is necessary. There are 3 primary forms:

  • Individual company - an option for people who are just starting their business. Its essence is that the founder is fully responsible for all the mistakes and debts of the organization. If the company earns less than €22,000 in the first year and not more than €50,000, it can be classified as a small business (Kleingewerbe). This reduces the number of bureaucratic procedures.
  • Business partnership - at least two people are involved. There are several forms (GbR and OHG), but all of them, except the commercial partnership (KG), are fully responsible for the debts associated with the business.
  • Corporation (Kapitalgesellschaft) - despite the name, this is the favorite form of business for startups and companies. The most common form is GmbH (Limited Liability Company), which requires a share capital of €25,000. If such money is not available, opening a UG (Unternehmergesellschaft) is possible, where €1 is enough to start.

How to open a company in Germany

The first thing a foreigner has to do when arriving in Germany is to register at the local citizen's office (Bürgeramt). It should be done within two weeks if you plan to stay in the country for over three months. Afterward, this registration (Anmeldung) will enable you to get a tax number, a residence permit, a bank account, sign a cell phone contract, etc.

Once registered, you must get a residence permit, which allows you to do business. You also have to:

  • Develop the Articles of Incorporation and other corporate documents;
  • Choose a unique name;
  • Rent an office, which will be the legal address of the company.

The next step is to register the company with the Gewerbeamt, after which you can get a trade license to do business. An additional license may be required some areas, such as insurance brokers.

Once you receive a trade license, you must register your business with the tax office (Finanzamt). It is a long and tedious procedure, requiring filling out a lot of paperwork. When it is completed, the business owner receives tax and VAT numbers, if applicable.

Then it is necessary to open a commercial account at a local bank. You will need it for business operations and proper bookkeeping, which will be carefully checked.

Once these steps have been completed, you can get to work.

How to start a company in Germany quickly

Contact IT-OFFSHORE experts to register a business in Germany in 2023.

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