Company formation in Germany

Company formation in Germany: who does what

The core of the process is fixed by law. The articles of a GmbH need notarial form, and the notary files the company with the register court. Everything around that can be bought from an adviser.

Party	Role in a formation
Notary (Notar)	Identifies the parties, notarises the articles, files the company with the Handelsregister
Register court (Registergericht)	Checks the filing and enters the GmbH in the commercial register
Trade office (Gewerbeamt)	Receives the trade notification before trading starts
Tax office (Finanzamt) and BZSt	Issue the tax number and the VAT identification number
Steuerberater or audit firm	Tax registration, bookkeeping, payroll, annual accounts and tax returns
Lawyer (Rechtsanwalt)	Tailored articles, shareholder agreements, permits and disputes
Corporate services provider	Coordination, business address, document handling, sometimes a local director

When a website promises to “register your GmbH online in a day”, it is selling coordination. Only the notary submits the register application, and only the court makes the entry.

What a formation provider handles

A full mandate starts with the choice of structure and ends when the GmbH can send invoices, run payroll and file its returns. It usually covers:

• Structure advice: GmbH, UG, a branch of your foreign company, or a German holding above an operating company, and what each means for liability and tax.
• Articles of association: whether the statutory model protocol is enough or tailored articles are needed for several shareholders, share classes or approval rights.
• The notary file: passports, the German address, the foreign parent’s register extract and articles, apostilles and certified translations.
• Signing logistics: an appointment in Germany, a power of attorney signed abroad, or a video session for founders with an accepted eID.
• Capital and bank: opening the account into which the capital is paid, and preparing the information the bank asks for.
• Registrations after the entry: the trade notification, the tax office registration with the request for a VAT number, and the report to the Transparency Register.
• First-year compliance: a filing calendar for VAT, payroll and the annual accounts.

A foreign company that only wants a German branch needs a shorter list. No new company is founded; the provider prepares the register filing for the branch with the parent’s documents, or only the trade notification for a dependent branch, as GTAI explains for branch offices.

Which kind of firm fits your formation

Of the 71 firms on Accountanty that offer company formation in Germany, 54 are accounting firms, 12 are law firms and 5 are corporate services providers. Most are small: 44 small firms, 18 medium-sized firms and 9 in large networks.

• Accounting and tax firms suit founders who want one team for the formation and the years after it. Accounting is also offered by 66 of the 71, and tax compliance by 63.
• Law firms suit formations with several shareholders, investors, a joint venture or a regulated activity, where the articles and side agreements need drafting.
• Corporate services providers suit groups that need coordination across countries, a business address or help with documents from several jurisdictions.

Whatever the firm type, the notarisation stays with a notary. Ask whether the provider brings one or expects you to choose.

Credentials worth checking

Two German rules decide who may do what on your file.

• Tax advice. Giving tax help as a business is reserved to authorised people. The Tax Advisers Act names Steuerberater, Steuerbevollmächtigte, lawyers, Wirtschaftsprüfer and vereidigte Buchprüfer, and their professional companies. Purely mechanical bookkeeping is outside the rule, but assigning vouchers to accounts counts as tax help. Some formation firms on Accountanty state that they are a Steuerberatungsgesellschaft, a professional tax advisory company.
• Legal advice. Out-of-court legal services are only allowed where a law permits them. Drafting tailored articles or a shareholder agreement is lawyer’s or notary’s work.

Ask which person on your file holds the qualification and which regional chamber admitted them, then check it with that chamber.

Corporate services providers that form companies, act as managing director or provide a business address are obliged entities under the Anti-Money Laundering Act. Expect them, like the notary and the bank, to identify you and ask where the money comes from. A provider that skips those checks is a warning sign, not a convenience.

What the provider needs from you

A provider can only price what it can see. Bring this to the first meeting:

• The business model: products or services, customers, where staff will sit and when the first hire is planned.
• The people: passport copies and private addresses of every shareholder and director, and for a corporate shareholder its register extract, articles and a chart showing the individuals at the top.
• The German address: a lease or other arrangement, since the register filing must state a domestic business address.
• Source of funds: where the share capital and the first working capital come from.
• Residence plans: whether a founder will move to Germany and manage the business there, which may add a self-employment permit application to the work.
• The planned activity in detail: some trades need a permit, which the provider should check before the notary appointment.

How to read a company formation quote

Request the price in three separate blocks; that is the only way to set two offers side by side.

Official charges

• Notary’s fee. Ask for the notary’s own estimate for your structure, separate from the provider’s fee. GTAI notes that the model articles are notarised for a reduced fee.
• Register court and publication. Charged by the justice authorities after the entry. The register portal says its billing runs through the central payment agency of the justice authorities at the Oberlandesgericht Hamm, and it warns about payment notices relating to its online services.
• Trade office fee, apostilles and translations: usually passed on at cost.

The provider’s own fee

This covers structure advice, preparing the notary file, coordinating the signing, opening the bank account and the registrations after the entry. Ask what is excluded. Tailored articles, a holding structure, extra shareholders, foreign document handling and changes after the draft are typical extras.

Recurring costs

The founding work is paid once, but the company costs money every month after that. A good quote prices the first two years too:

• bookkeeping and the monthly VAT pre-returns that a new business files in its first calendar year and the next;
• payroll once staff or a managing director’s salary start;
• the annual accounts, which a GmbH discloses in German within one year of the balance sheet date, and the corporation and trade tax returns;
• a business address or local representative, if you need one.

Sending a request through Accountanty is free of charge; each firm that replies quotes its own price.

Shelf companies: buying a ready-made GmbH

Some providers sell a shelf company (Vorratsgesellschaft): a GmbH already entered in the register that has never traded. The appeal is that you skip the wait for the entry. The costs are different, not absent:

• A notary is still needed. Taking over the shares requires a contract in notarial form, and changing the name, purpose, seat or director means new register filings.
• VAT starts monthly. The VAT Act treats a registered shelf company that starts trading, and the takeover of a dormant company shell (Firmenmantel), like a new business: monthly pre-returns in the current and following calendar year.
• History and diligence. Ask for the register extract, the shareholder list and confirmation that the company has no debts or past activity, and have the share purchase reviewed by your own adviser.

Usually, a new GmbH built on a well-prepared notary file is the plainer path. A shelf company fits when a ready legal entity is needed for a specific deadline.

Questions to ask before you sign

• Which notary will notarise the articles, and will I see the draft first?
• Can I sign through a power of attorney from abroad, or by video, and what does the notary need for that?
• Are the notary’s and the court’s charges in your quote, or billed to me directly?
• Who registers the company with the trade office and the tax office, and who asks for the VAT number?
• Who files the Transparency Register report and the updated shareholder list?
• Who on the team is a Steuerberater or lawyer, and which chamber admitted them?
• Who is my contact after the entry, and in which languages can they work?

On language, 54 of the 71 formation firms listed offer English, 67 German and 12 Polish; a few also work in Russian, French, Italian or Turkish.

When a foreign group is the shareholder

A group shareholder adds paperwork at the parent’s end. The notary needs proof that the parent exists and who may sign for it: GTAI mentions an excerpt from the foreign commercial register and the parent’s articles, with authentication and translation depending on the parent’s country and legal form. Add a board resolution approving the investment and naming the signatory, and an ownership chart for the bank and the Transparency Register.

Two decisions shape the quote. First, a subsidiary GmbH or a branch: the branch avoids founding a new company, but the parent stays liable for it. Second, who manages the German entity: a director sent from the group, a person hired locally or a professional director. The managing director must be a natural person, so each choice changes the payroll, the bank’s review and the provider’s role.

Services you will need after incorporation

From the first month, the GmbH has regular filings. Founders often stay with the formation firm, or bring in other firms listed for:

• accounting and tax compliance for the books, the annual accounts and the tax returns;
• VAT for the monthly pre-returns and cross-border invoices;
• payroll once you employ staff;
• audit, if the company’s size or its investors require audited accounts;
• bank account assistance when the bank asks for more on the company or its owners;
• corporate secretarial work such as shareholder resolutions and register changes;
• a virtual office or business address;
• residency and visas if a founder moves to Germany.

Warning signs

• The notary stays vague. If the provider will not say who notarises, it cannot vouch for the date or the draft.
• One lump sum and no detail. It cannot be set against other offers, and extras tend to surface after signing.
• Tax advice from someone not authorised. Ask for the Steuerberater’s name and chamber.
• An account opening sold as certain. The bank makes its own decision after its own checks.
• No identity or source-of-funds checks. Obliged entities under the money laundering rules must carry them out.
• Silence on the first-year calendar. Monthly VAT pre-returns start almost at once.

Making the final choice

Give the same brief to two or three firms, then line up their notaries, their fee blocks and the people who would keep your books. Formation firms listed on Accountanty are spread across Berlin with 23, Frankfurt with 19, Hamburg with 13 and Munich with 12. One free quote request reaches several of them: Accountanty reviews it and forwards it to firms that fit your brief for company formation in Germany.