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Founding a company in Germany: €9600, 152 days and I still can't send an invoice

paolino.me

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Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#161

Post by eqvinox »

earcar wrote: post #155
weinzierl wrote: post #126

Not to defend German bureaucracy but if you are serious and want results this is not how you do it. If you want a GmbH quickly there are specialized lawyers that maintain a pool of freshly founded GmbH's for you to buy. Everything is set up for you to start. If you don't like certain things like the company name, you can always change it later. That being said, I know plenty of people who founded their GmbH themselve…

> there are specialized lawyers that maintain a pool of freshly founded GmbH's for you to buy It doesn't sound easy nor cheap to buy a company and change the company name. UG & Co. KG has a couple of advantages and while it did add some money and time to the table, it doesn't change the story. Notaries in the US are the price of a dinner. Many people have waited up to 6 months to receive their VAT ID from Berlin.

> from Berlin

That's your problem right there. If you live in Berlin, take the 2 hours and go to Hamburg or Leipzig before doing anything that needs a working bureaucracy.

Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#162

Post by Ekaros »

mb_thd wrote: post #91
ExoticPearTree wrote: post #55

Earlier quoted context omitted.

> Ranting about choosing most complex business form and having no money for a consultant is not adequate in my eyes. You shouldn't need a consultant to open a company. Should be a form and that's it. Maybe an accountant to certify your books, but that's it.

If you're choosing to go with the most complicated way of setting up a company, a consultant probably doesn't hurt.

When you choose that you need double layer of limited liability. Maybe having a consultant is extremely good idea. To understand exactly what you need to do at both layers. And maybe in such setup some slow down should be fully expected. As one layer is acting for the other in your stead...

To me things taking longer and being more complicated sounds entirely reasonable and natural in such setup...

Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#163

Post by RicoElectrico »

I wonder what's the reason. Poland used to have horrible bureaucracy. You could argue this was due to lack of funds, or communist baggage. Yet, over the last decade digital administration has become a norm, rather than exception.

Germany doesn't have such excuses, yet there it is.

Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#164

Post by kuerbel »

martijnvds wrote: post #152
johndough wrote: post #68

Earlier quoted context omitted.

> Its not an issue to adhere with your private money if your product isn't causing damages. Might happen really easily though. E.g. you install some package which has been compromised, infecting your software product and suddenly all your customer's systems are cryptolocked and you are on the hock for millions of €€€. Or your db crashes in new and creative ways and your backups don't work for some reason and now your…

Isn't that what (liability) insurance is for? (if there's anything Germans like as much as bureaucracy it's insurance)

Every good company in Germany has insurance. General liability insurance

Professional indemnity insurance

Business interruption insurance

Directors and Officers (D&O) insurance

Commercial legal expenses insurance

nowadays Cyber insurance

I think I might have forgotten one or two...

Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#165

Post by rob74 »

> Which leaves the only real question. Why 25,000 at all? It is my company and my risk. If I want to start with nothing, that is my call, not a toll the state collects before it will let me try. And the cheap door has a price of its own: to some clients, “UG” reads as “not serious,” and they would rather deal with a GmbH. The structure built to let me in quietly marks me for using it.

The 25,000 is there to make sure you can cover some liability. If you really wanted "your company and your risk", you could have used the "simplest setup", where you are liable with your own money, but if you think about it that way, it doesn't sound so appealing, does it? So of course the UG which does not (yet) have 25,000 in the bank sounds less serious than the GmbH that has 25,000 in the bank. A company that starts with nothing wouldn't be a GmbH (limited liability company), it would be a GoH (company without liability), and there's a good reason why those don't exist...

Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#166

Post by CodesInChaos »

simon_a99 wrote: post #129
Kim_Bruning wrote: post #22

I looked into GmbH (german) , BV (dutch) , and OU (estonian) . GmbH seems very unpleasant. BV and OU are easier to obtain. But BV requires your primary place of business to be the Netherlands, which isn't always practical when you're trying to extend your activities internationally. OU is supposed to be better for international operations, but -because it's a single country initiative- creates new and interesting tax…

As far as I'm aware , EU inc would be an opt in initiative meaning that it likely wont change anything in Germany. DE has a a very powerful notary lobby that will oppose this at all costs.

I read that as the founder being able to opt into choosing EU Inc, not that only some EU member countries would offer it.

edit: it's a regulation, not a directive, so it will be directly available in all countries, without each country creating its own laws to implement it. But it'll take until 2028 or so until it's actually be available.

Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#167

Post by amadeuspagel »

> My first company, Freshflow, is valuable enough that walking out of Germany would trigger a massive six-figure exit tax, on gains I have not even realised, purely for the privilege of leaving.

Without this "exit tax", every founder of a successful business would have a huge incentive to leave and to realize the gains elsewhere. It's not a tax for the privilige of leaving, but for the privilege of building a company. I can see only three alternatives to this:

- Abolish the capital gains tax entirely.

- Make defering it impossible. Force people to pay immidiately. No "exit tax", but people have to pay for unrealized gains.

- Tax people when they realize their gains in a foreign country.

Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#168

Post by mpweiher »

Aurornis wrote: post #95
mpweiher wrote: post #29

Earlier quoted context omitted.

Yes, what you are doing is complicated. I did a GmbH with "Musterprotokolle" so virtually no lawyer fees and quick and easy to set up. And a GmbH is limited liability. It's in the name. Gesellschaft mit beschränkter Haftung . GmbH. The Geschäftsführer is liable for certain (avoidable) things in either case. The difference is that that the Co KG can be taxed like a "Personengesellschaft". So you wanted to optimize tax…

> But then don't moan about it being complicated. It was your choice. I don’t understand why you’re deriding someone for explaining why establishing a common business structure is slow and complicated. The fact that a less advantageous business structure is available faster, but with significant tradeoffs, does not diminish the problems with this business structure.

I am pointing out that his claims are, in fact, not true.

It is not this complicated to set up a limited liability company in Germany. It is this complicated to set up his choice of a two company setup. Which is, I repeat, his choice and much rarer than a GmbH, at around a 5-10% ratio. Because it is more complicated, not just to set up, but also to run. You have two companies, so two sets of books, two sets of audited returns etc.

Which is why most companies are not GmbH & Co KG. They are plain GmbH. A GmbH & Co KG is a much more complex setup and known to be a much more complex setup. Which he knowingly chose.

And his claim that this is somehow necessary for limited liability, which would be a legitimate "significant tradeoff" is simply not true at all. That's what the GmbH is for.

Now maybe he was badly advised by his lawyer, but then complain about the bad advice. Not about the consequences of choices you made.

Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#169

Post by dghlsakjg »

brookst wrote: post #73
AussieWog93 wrote: post #38

Earlier quoted context omitted.

It didn't actually click for me until this post that there was an actual US State called Delaware. I just thought it was a type of company.

Sure, a Delaware Corporation, like a Long Island Iced Tea.

No. No. You’re thinking of Arizona Iced Tea, which is a New York corporation.

Re: Founding a company in Germany: €9600, 152 days and I still can't send an invoice

#170

Post by tene80i »

earcar wrote: post #48
VadimPR wrote: post #8

Before Europe gets lumped in as one country, founding a company in Netherlands and Sweden, speaking from personal experience, is a breeze. Although Sweden is a bit strange in the fact that banks have as much equal say as the government authority does in you starting a company, and if they don't want you as a customer, they can simply deny the right for your company to start!

That is refreshing to hear. Unfortunately I can't get out because of exit tax, an unrealized capital gains tax for the privilege of leaving the country. That is way worse than what I mention in this post and will get its own post soon.

You phrase this as if it’s absurd. Why should it be possible to offshore your future capital gains without paying an exit tax? You live in a country with a tax system that assumes people pay into it.
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