self employment in Germany
February 23, 2024
An overview of important tax tips for startups in Germany
As the founder of a startup in Germany, you should be fully familiar with the types of taxes that you will be required to pay after starting your business. For this purpose, it is better to get help from a tax advisor in Germany. Here, we briefly mention ten important tax tips for startups in Germany:
1. After registering your business in Germany, complete the tax registration questionnaire and submit it to the tax office. Then, apply for a tax number.
2. Estimate the profit from your business in the first year for the tax office.
3. Read German tax paragraphs and learn about tax saving tricks.
4. Reduce your tax burden by forecasting your business expenses.
5. If you start your business in Germany after a period of unemployment, you can use German tax laws to optimize your business tax.
6. Take advantage of tax benefits for founders in Germany.
7. In the first two years after registering your business in Germany, you must calculate your tax monthly for the pre-registration of the tax return and report it to the tax authorities.
8. According to the amount of profit, the legal form and the size of your business in Germany, use the correct method of determining the profit.
9. Pay attention to corporate performance tax.
10. You can reduce your business tax burden by registering a Gewerbe business in Germany.
March 4, 2024
A brief overview of the types of legal forms in Germany
The legal form of a company specifies the ownership structures and the distribution of risk and liability in that company. Therefore, choosing it before starting a business is especially important.
Legal forms in Germany are divided into three categories: corporations, partnerships, and sole proprietorships. Each of them also has different subsets as follows:
Corporations in Germany
• Limited Liability Company (GmbH)
• Company with limited liability and limited partnership (GmbH & Co. KG)
• Entrepreneurial Company (UG)
• Public joint stock company (AG)
• Private limited company based on shares (Ltd.)
Partnerships in Germany
• Civil Law Partnership (GbR)
• General partnership (OHG)
• Limited Partnership (KG)
Sole proprietorships in Germany
• Sole proprietors
• Sole merchants
• Freelancers
• Small business owners
To choose an appropriate legal form for your business in Germany, you should pay attention to the number of founders, required share capital, start-up process and costs, liability, and accounting requirements. You can also consult experts in this field.
March 11, 2024
A review on "Made in Germany" label provision
"Made in Germany" label is somehow equals a guarantee for high quality products. To sum up, for using this label, you should follow some rules:
Your production process including development, design, production and quality assurance must be done in Germany.
The parts determine the nature of your products should be made in Germany. In other words, the base of value chain should be in Germany.
May 19, 2024
Information on UG or mini-GmbH companies at a glance
• The entrepreneurial company (UG) has existed since 2008.
• It is a particular form of limited liability company (GmbH), not an independent legal form.
• It is also colloquially called a mini-GmbH.
• The required capital for establishing a UG in Germany is 1 euro.
• Shareholders must keep one-quarter of the company's annual net profit to compensate the initial capital.
• By providing 25000 euros, you can convert it to a GmbH.
August 24, 2024
A brief about querying the information of a company in Germany
You can use the following sources if you intend to buy a specific company in Germany and want to inquire about some tax, legal, and credit information before purchasing the company:
1. Inquiring about the company's registration history, legal status, and its managers through the Handelsregister website
2. Access to annual reports, balance sheets, and financial information of the company through the Bundesanzeiger website
3. Inquiring about the company's possible lawsuits through local judicial authorities in Germany
4. Inquiring about the company's tax situation through tax consultants or local auditors
5. Receiving a comprehensive report of the company's financial, credit, and judicial status through validation companies
September 16, 2024
A summary of the crucial points for self-employment through import or export in Germany
To answer your questions regarding import or export in Germany, you can get help from the following institutions and authorities:
Rules and regulations:
• German Federal Office of Economics and Export Control (BAFA): It is possible to see the regulations related to import or export restriction of commercial goods here.
• German Federal Agriculture and Food Agency (BLE): This department is responsible for checking export or import restrictions of agricultural products.
• Customs: You should get complete information about customs rules and regulations. You can access this information through the Atlas electronic system and handle your customs affairs online.
Information on countries, markets, and a database for searching business partners
• Foreign chambers of commerce, as your contacts in the target country, can provide information in this field.
• German trade and investment also provide great information and support international businesses.
• You can also search for information and business partners on the iXPOS portal.
Export insurance
• Click here to enter the federal information portal related to export insurance in Germany.
Foreign trade statistics and data
• The Federal Bureau of Statistics provides foreign trade data.
• These data are presented graphically in the Foreign Trade Statistical Atlas.
September 26, 2024
An overview of the financial requirements for obtaining a self-employment residence permit in Germany
As an applicant for a self-employed residence permit in Germany, you must provide documents based on having sufficient financial resources to start a business and cover your expenses in Germany. Also, you need to prove that your business has a good chance of success in the German market and can be favorably profitable. Other financial requirements include:
• A document based on obtaining private or public health insurance in Germany
• Realistic predictions of how to make money in the first years after starting a business in Germany
• A document based on the ability to provide the minimum required initial capital and start-up costs
Evidence of the ability to cover other expenses in a business setting up procedure in Germany, including licensing fees, office space, and operational requirements.
November 20, 2024
In summary, we can say that the initial capital needed to start a business in Germany consists of the following factors:
• The chosen business structure
• The industry sector in which you are going to operate.
• The geographical location of the business in Germany
• The operational scale
• Market conditions
• Technological needs
• Unforeseen costs
It is necessary to carefully evaluate all of these factors and make necessary plans for them before starting your business. In this case, you can successfully go through the business starting process in Germany and ensure the viability of your company.
December 17, 2024
A brief look at prominent points for regulating the company object in Germany
• Accuracy and transparency: State your company object clearly and understandably and use general terms to maintain flexibility.
• Alignment with business activities: Mention all of the company's current and anticipated activities in your chosen topic.
• Legal compliance: Ensure that your company's activities comply with German laws and obtain required licenses for specific industries.
• Tax considerations: Structure your company object in Germany free of unwanted tax consequences.
• Broad vs. limited scope: Avoid overly general terms and add essential details to the subject of your activity.
• Industry-Specific Details: Focus on specific industry areas such as manufacturing, services, and research.
• Inclusion of side activities: Specify additional company activities such as administrative duties or side investments.
• Flexibility for future reforms: Set your activity theme so that you can change it.
• Professional language: For clarity with legal authorities, use formal legal and business language.
• Consulting with experts: Consult an attorney or tax advisor for legal and tax compliance.
