Starting a Company in Germany (GmbH & UG)
Ready to go beyond freelancing? From a one-euro UG to a full GmbH — the legal forms, the crucial visa question for non-EU founders, the steps to register, and the taxes a company pays.
From side project to a real company
Germany makes limited-liability companies accessible — but for non-EU founders the first question is not "which form?", it is "does my visa even allow this?".
Einzelunternehmen
Sole proprietorFreelancers & small one-person businesses. Simplest and cheapest to start.
See the freelancing guide →GbR
PartnershipTwo or more people starting together informally. Easy, but everyone is personally liable.
UG (haftungsbeschränkt)
"Mini-GmbH"Bootstrapping a limited-liability company with little cash. Must save 25% of profit until reserves reach €25,000, then convert to GmbH.
GmbH
Limited companyThe standard serious company — clients, investors and partners trust it. Most common limited form in Germany.
Settlement permit (Niederlassungserlaubnis)
Generally allows self-employment freely — the most comfortable position from which to found a company.
EU Blue Card / employee permit
Tied to your employment. Running a business alongside it usually needs the Ausländerbehörde to add explicit self-employment permission (Nebentätigkeit / selbständige Tätigkeit). Do not assume it is allowed.
Self-employment residence permit (§21 AufenthG)
A dedicated permit to come to (or stay in) Germany to run your own business. It typically requires a convincing business plan, evidence of financing, and an economic benefit — often assessed with input from the IHK.
Students
A student residence permit does not allow you to run a company as your main activity; working hours and self-employment are restricted. Founding usually has to wait for a different permit.
Being a shareholder vs a managing director
Merely holding shares can differ from actively working as the managing director (Geschäftsführer). The active, day-to-day role is what needs a permit allowing self-employment — get advice on your exact setup.
Draft the articles (Gesellschaftsvertrag)
Define shareholders, capital, purpose and the managing director. A standard template (Musterprotokoll) is cheaper and faster for a simple single-owner company.
Notarise at a Notar
The notary certifies the articles and the shareholders. Bring passports/IDs. The notary also files the company for the commercial register.
Open a business bank account & deposit capital
Open a company account and pay in the share capital (from €1 for a UG; at least €12,500 for a GmbH). The bank confirms the deposit to the notary.
Register in the Handelsregister
The notary submits the company to the commercial register. Once entered, the GmbH/UG legally exists and can fully trade.
Business registration (Gewerbeanmeldung)
Register the trade at the local Gewerbeamt. (Purely liberal-profession activity may not need this — but a GmbH/UG generally does.)
Register with the Finanzamt
Complete the tax questionnaire (Fragebogen zur steuerlichen Erfassung) to receive your tax number (Steuernummer) and, if needed, a VAT ID (USt-IdNr.).
IHK membership & final admin
Chamber of Commerce (IHK) membership is mandatory and charges an annual fee. Also register with the Transparenzregister and sort insurance and payroll if you hire.
Corporation tax (Körperschaftsteuer)
15% on company profit, plus 5.5% solidarity surcharge on that — about 15.8% combined.
Trade tax (Gewerbesteuer)
Charged by your municipality; the effective rate varies with the local multiplier (Hebesatz), commonly landing around 7–17% of profit.
VAT (Umsatzsteuer)
Usually 19% (7% on some goods). You add it to invoices and pass it on; the Kleinunternehmer rule can exempt very small businesses.
Bookkeeping & accounts
A GmbH/UG must keep double-entry books and file annual financial statements — plan for a Steuerberater and accounting software.