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Bootstrapping a SaaS Business in Germany: How I did it

lukashermann.dev

21–30 of 110 posts

Re: Bootstrapping a SaaS Business in Germany: How I did it

#21

This is such a european startup story - where most energy is spent setting up a company and navigating bureaucracy rather than building a product. If anyone wonders why europe has such a lower number of startups this is why. And it’s not the government at fault. It’s the culture. Like seriously just pay someone 200€ to do this on your behalf and focus on stuff that matters not the “legal gray area” of earning pocket…

In the UK you pay £12 online, fill in an address and it's done. So that's not true. It completely depends on the European country. And given the Germany is the economic powerhouse of the EU, their bureaucracy doesn't seem to be hurting them much.

>And given the Germany is the economic powerhouse of the EU, their bureaucracy doesn't seem to be hurting them much.

Germany is the "powerhouse of Europe", not because of start-ups and business friendly environment, but because of giant 100-year old dinosaurs like Siemens, Bosch, Daimler, VW, etc, who were innovative in the post-WW2 times and can afford all the lawyers and tax consultants the state could ever require them.

But with US and China hot on their heels on areas that the German dinosaurs were champions like motor vehicles, and dominating all things internet related, they might not be a powerhouse 100 years from now if they don't improve and modernize their mentality and keep leaving bureaucracy and innovation to the retired boomers who grew up with "world powerhouse Germany".

Re: Bootstrapping a SaaS Business in Germany: How I did it

#22
post #11

Why a GmbH in Germany? Sorry, that was not a good idea and will costs you money and nerves to fix that. Now you are locked into Germany even if your business can be operated from everywhere around the globe. If you move the GmbH out of Germany you have to pay GmbH fair value ; fair value according to German Tax Authority! Do a Holding GmbH + Operative GmbH to accumulate wealth tax efficiently. You could have your com…

That is not true. It easy to create a holding on top of your GmbH in which case you only pay for 5% of the revenue taxes.

The only shoot in the foot is the higher cost of declaring taxes being it in time or in fee for a specialist.

And as long you are working from Germany you have to pay taxes for any kind of money you are going to take out from the company, being ist as dividend or salary.

The only exception is when you are not residing in one country in the EU for longer than 6 Months than you can play around with a LLC construct or other Holding structures from countries that have a double-tax avoidance agreement.

Re: Bootstrapping a SaaS Business in Germany: How I did it

#23

This is such a european startup story - where most energy is spent setting up a company and navigating bureaucracy rather than building a product. If anyone wonders why europe has such a lower number of startups this is why. And it’s not the government at fault. It’s the culture. Like seriously just pay someone 200€ to do this on your behalf and focus on stuff that matters not the “legal gray area” of earning pocket…

> where most energy is spent setting up a company and navigating bureaucracy

maybe that's the goal of the system? Small players end up dying so big corps who can afford an army of accountants and lawyers prevail.

Re: Bootstrapping a SaaS Business in Germany: How I did it

#24

This is such a european startup story - where most energy is spent setting up a company and navigating bureaucracy rather than building a product. If anyone wonders why europe has such a lower number of startups this is why. And it’s not the government at fault. It’s the culture. Like seriously just pay someone 200€ to do this on your behalf and focus on stuff that matters not the “legal gray area” of earning pocket…

Germany has a huge burocracy problem, but not all countries in Europe do. In Norway company registration is done online in around 15 minutes, for a 370 EUR fee. I am pretty sure Denmark, Sweden and Finland are the same. I have registered companied both in Germany and Norway, the processes are very different in terms of hurdles.

Re: Bootstrapping a SaaS Business in Germany: How I did it

#25
post #11

Why a GmbH in Germany? Sorry, that was not a good idea and will costs you money and nerves to fix that. Now you are locked into Germany even if your business can be operated from everywhere around the globe. If you move the GmbH out of Germany you have to pay GmbH fair value ; fair value according to German Tax Authority! Do a Holding GmbH + Operative GmbH to accumulate wealth tax efficiently. You could have your com…

Why would you look to avoid paying tax though?

I can understand doing so in a country that is squandering money - like the UK, where you pay through the nose and get very little in return, but Germany? I heard public services and basically what you get for your tax is pretty decent.

Re: Bootstrapping a SaaS Business in Germany: How I did it

#26
post #11

Why a GmbH in Germany? Sorry, that was not a good idea and will costs you money and nerves to fix that. Now you are locked into Germany even if your business can be operated from everywhere around the globe. If you move the GmbH out of Germany you have to pay GmbH fair value ; fair value according to German Tax Authority! Do a Holding GmbH + Operative GmbH to accumulate wealth tax efficiently. You could have your com…

I don't know how to judge this comment? Is this essentially recommending dodging the taxes via a more complicated holding situation and the "do vacation in Germany", so essentially operate from germany?

If so, I think this is highly unethical. Corporations have to pair their share to keep the society functioning...not just "normal" peoples with their salaries while all the profits get sucked into a foreign black hole.

Re: Bootstrapping a SaaS Business in Germany: How I did it

#27
post #11

Why a GmbH in Germany? Sorry, that was not a good idea and will costs you money and nerves to fix that. Now you are locked into Germany even if your business can be operated from everywhere around the globe. If you move the GmbH out of Germany you have to pay GmbH fair value ; fair value according to German Tax Authority! Do a Holding GmbH + Operative GmbH to accumulate wealth tax efficiently. You could have your com…

Why would you look to avoid paying tax though? I can understand doing so in a country that is squandering money - like the UK, where you pay through the nose and get very little in return, but Germany? I heard public services and basically what you get for your tax is pretty decent.

why is this even the first thing that comes to mind when thinking about the legal form? This is highly unethical in general and really just super selfish.

F*k you if you avoid taxes, especially in a country like Germany where society paid for your university studies etc.

Re: Bootstrapping a SaaS Business in Germany: How I did it

#28
post #11

Why a GmbH in Germany? Sorry, that was not a good idea and will costs you money and nerves to fix that. Now you are locked into Germany even if your business can be operated from everywhere around the globe. If you move the GmbH out of Germany you have to pay GmbH fair value ; fair value according to German Tax Authority! Do a Holding GmbH + Operative GmbH to accumulate wealth tax efficiently. You could have your com…

Why would you look to avoid paying tax though? I can understand doing so in a country that is squandering money - like the UK, where you pay through the nose and get very little in return, but Germany? I heard public services and basically what you get for your tax is pretty decent.

Everyone is trying to minimize taxes in a legal way. The best example is Apple. With enormous profits they pay almost zero federal taxes.

Re: Bootstrapping a SaaS Business in Germany: How I did it

#29

Earlier quoted context omitted.

Why would you look to avoid paying tax though? I can understand doing so in a country that is squandering money - like the UK, where you pay through the nose and get very little in return, but Germany? I heard public services and basically what you get for your tax is pretty decent.

why is this even the first thing that comes to mind when thinking about the legal form? This is highly unethical in general and really just super selfish. F*k you if you avoid taxes, especially in a country like Germany where society paid for your university studies etc.

> F*k you if you avoid taxes, especially in a country like Germany where society paid for your university studies etc.

People can move in from other countries, you know.

Re: Bootstrapping a SaaS Business in Germany: How I did it

#30
post #19
post #11

Why a GmbH in Germany? Sorry, that was not a good idea and will costs you money and nerves to fix that. Now you are locked into Germany even if your business can be operated from everywhere around the globe. If you move the GmbH out of Germany you have to pay GmbH fair value ; fair value according to German Tax Authority! Do a Holding GmbH + Operative GmbH to accumulate wealth tax efficiently. You could have your com…

I think the days when you could just set up a company in some random country and run it from Germany are pretty over, the Finanzamt will just treat it as a domestic entity unless you can prove you've gone full nomad.

You don't need to go full nomad, just spend half a year + 1 day out of Germany.
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