How to start a company in Germany
Last checked: November 2026 · Currency: EUR
Most German startups are a GmbH. A UG (haftungsbeschränkt) is a low-capital starter version that you can later convert into a GmbH. You need a notary to found the company and to transfer shares, though notarisation can now be done online by video. Plan on 2–4 weeks and €25,000 of share capital, at least half of it paid in before registration.
General information, not legal or tax advice. Rules and fees change; always check the official source.
Company types
| Type | Minimum capital | Liability | Best for |
|---|---|---|---|
| GmbH Gesellschaft mit beschränkter Haftung | €25,000 (at least €12,500 paid in at registration) | Limited | Teams planning to raise investment |
| UG (haftungsbeschränkt) Unternehmergesellschaft (haftungsbeschränkt) | From €1 (must be fully paid in; 25% of each year's profit must be retained until €25,000 is reached) | Limited | Teams with little cash who want limited liability now and a GmbH later |
| GbR Gesellschaft bürgerlichen Rechts | None | Unlimited (personal) | Testing an idea together before incorporating; not suitable for investors |
Registration, step by step
- 1Agree on equity, roles and vestingAgree on shareholdings, who runs the company as managing director (Geschäftsführer), and vesting with good/bad leaver rules. These usually go into a shareholders' agreement, which must also be notarised if it contains obligations to transfer shares.BMWE – Existenzgründungsportal
- 2Choose GmbH or UG and draft the articlesChoose between a GmbH and a UG. With up to 3 founders you can use the cheaper statutory model protocol (Musterprotokoll), but investor-ready teams usually draft their own articles (Gesellschaftsvertrag).GmbH Act (GmbHG)
- 3Notarise the founding documentsAll founders sign the articles in front of a German notary, either in person or online by video using the eID function of a German ID card or a comparable EU eID. The notary then files the registration with the commercial register.Common Register Portal (Handelsregister)
- 4Open a business account and pay in the capitalOpen a business bank account for the company in formation and pay in the capital: at least €12,500 for a GmbH, or the full amount for a UG. The managing directors confirm the payment to the register, and the company exists once it is entered in the commercial register.Handelsregister
- 5Register the trade and taxesRegister the business with the local trade office (Gewerbeamt) if required. Within a month of starting, submit the tax registration questionnaire (Fragebogen zur steuerlichen Erfassung) through ELSTER to get a tax number and a VAT ID.ELSTER – online tax portal
- 6Check the Transparency RegisterMake sure the company's beneficial owners (anyone holding more than 25%) appear correctly in the Transparency Register. For a GmbH this is often covered by the commercial register data, but check it.Transparenzregister
- 7Register your trade markFile a German trade mark with the DPMA, or an EU trade mark with EUIPO if you plan to sell across the EU. Do this before you invest heavily in the brand.DPMA – Trade marks
Costs and time
| Item | Amount |
|---|---|
| Notary and commercial register (GmbH, model protocol) | about €500–750 Check the official source |
| Notary and register with custom articles of association | about €700–1,500+ (depends on the deal value and how complex the documents are) Check the official source |
| Trade registration (Gewerbeanmeldung) | about €15–65 depending on the city Check the official source |
| Share capital (not a fee, stays in the company) | GmbH: €12,500 minimum paid in; UG: from €1 |
| Tax adviser for annual accounts and returns | roughly €1,500–5,000 per year for a small GmbH Check the official source |
How long it takes: Typically 2–4 weeks from the notary appointment to entry in the commercial register. Online notarisation and fast bank account opening can make it shorter.
Taxes
| Tax | Rate | Note |
|---|---|---|
| Corporate income tax (Körperschaftsteuer) | 15% + 5.5% solidarity surcharge (≈15.8%) | Legislated cut of 1 point per year from 2028, reaching 10% in 2032. |
| Trade tax (Gewerbesteuer) | about 7–17%+ depending on the municipality | 3.5% base rate × local multiplier (Hebesatz, at least 200%). For example, Berlin is about 14.4% and Munich about 17.2%. Combined burden is roughly 30%. Check the official source |
| VAT (Umsatzsteuer) | 19% standard, 7% reduced | Small-business exemption if turnover was ≤€25,000 last year and is expected to stay ≤€100,000 this year. Check the official source |
| Tax on dividends to individual shareholders | 25% flat withholding + solidarity surcharge (+ church tax if applicable) | Founders often hold shares through a personal holding GmbH to defer tax on exits; get tax advice before founding. |
Protect your name
TrademarkDPMA (national) or EUIPO (whole EU)€290 online at DPMA for up to 3 classes; €100 per extra class Trademark officeTrademark basics →
PatentDPMA (national) or European Patent Office (EPO)Patent officePatent basics, and when not to bother →
Tips for co-founders
- Transferring GmbH shares, including under vesting buy-back clauses, requires a notarial deed, so build vesting into notarised documents from the start.
- Vesting with good/bad leaver clauses is common in German startups and investors expect it, usually over 3–4 years with a 1-year cliff.
- You can use the Musterprotokoll with up to 3 founders and one managing director, but it is inflexible; most VC-backed teams use custom articles.
- Online founding by video notary works for GmbH and UG; you need a German ID card with eID or a comparable EU eID.
- Many founders hold their shares through a personal holding GmbH for tax reasons, and this is much easier to set up before founding than afterwards.
- Employee participation is often done with virtual share options (VSOP) because real share transfers need a notary.
Official links
General information, not legal or tax advice. Rules and fees change; always check the official source. Last checked: November 2026.