Germany company formation for non-residents

Why founders choose a German GmbH

German customers, suppliers and employees know the GmbH and trust it. If most of your revenue comes from Germany, Austria or Switzerland, a local company often makes contracts, hiring and marketplace onboarding simpler.

It is not a low-tax structure. The combined rate is around 30% in most large cities, and bookkeeping follows German commercial law. Choose Germany when you need a real presence there.

Germany is cutting its corporate tax. Under the investment programme law published in July 2025, the rate stays at 15% in 2026 and 2027, then falls by one point a year to 10% from 2032.

Corporate tax, trade tax and VAT

A GmbH pays three taxes on profit. Corporate tax is 15% for 2026 under § 23 KStG. The solidarity surcharge adds 5.5% of the corporate tax, taking the federal part to 15.825% of profit.

Trade tax (Gewerbesteuer) is set locally. The base rate is 3.5% of trade profit, multiplied by the municipality's multiplier (Hebesatz). In most large cities the result is roughly 14–17% of profit, so the combined burden lands near 30% (confirm your municipality with your specialist).

VAT is 19% at the standard rate and 7% at the reduced rate. The Finanzamt registers the company for tax after a questionnaire, and the Federal Central Tax Office (BZSt) then issues the VAT ID. For cross-border sellers, the VAT ID can take several weeks, so we start the questionnaire as soon as the company is registered.

• Corporate tax: 15% (2026 and 2027), then 14% in 2028 down to 10% in 2032
• Solidarity surcharge: 5.5% of corporate tax
• Trade tax: 3.5% × municipal multiplier
• VAT: 19% standard, 7% reduced

Share capital and the notary

The minimum share capital of a GmbH is €25,000 (§ 5 GmbHG). Before registration, at least a quarter of each share must be paid, and the total paid must reach half the minimum, so at least €12,500 (§ 7 GmbHG). The capital stays in the company and can be used for business costs after registration.

The articles need a notarial deed (§ 2 GmbHG). Since August 2022 the deed can be done by video with a German notary, using the notaries' online platform and a supported electronic ID. Where the video route does not fit, you can sign before a notary at home with the documents apostilled.

A smaller variant, the UG (haftungsbeschränkt), can be formed with far less capital. It must set aside a quarter of annual profit until it reaches €25,000. We explain both before you choose.

How formation works

We prepare the articles and the shareholder list, then book the notary. After the deed, the capital is paid into the company's bank account and the managing director confirms the payment to the notary.

The notary files the application electronically with the local court that keeps the Handelsregister. The GmbH exists once it is entered. We quote 2–4 weeks after KYC approval; the bank account for the capital is usually the step that takes longest for non-residents.

After registration, we file the tax questionnaire with the Finanzamt and report beneficial owners to the Transparenzregister. You receive the register extract, articles and shareholder list in your client portal.

Expect a few extra steps after registration. The Finanzamt sends the tax number by post, the trade office (Gewerbeamt) may need a trade registration, and the Chamber of Commerce (IHK) registers the company as a member. We track these for you and tell you what arrives when.

Directors, registers and annual accounts

One managing director (Geschäftsführer) is enough, and German law sets no residency rule. The managing director carries personal duties, including filing for insolvency on time, so we recommend a German tax adviser from day one.

The Handelsregister is public and shows shareholders and managing directors. Beneficial owners go to the Transparenzregister. Following the EU Court of Justice ruling of 22 November 2022, public access to that register needs a legitimate interest.

Every GmbH prepares annual accounts under the Commercial Code and publishes them. An audit applies only if the company exceeds two of three limits on two consecutive year ends: €7.5 million balance sheet, €15 million revenue and 50 employees (§ 267 HGB).

Banking and running costs

German banks and EMIs apply their own onboarding checks, and some accept non-resident founders only for certain business models. We introduce suitable institutions and prepare the file; the bank decides.

Year 1 costs a fixed quote all-in with OCC and year 2 renews at a fixed quote. Bookkeeping, payroll and tax returns in Germany are quoted separately because they depend on your volumes.

If you employ staff in Germany, payroll and social security registration follow separate rules, and we connect you with a local payroll provider.

Is a German GmbH the right choice?

A GmbH fits when Germany is where you sell, hire or hold stock. Customers, landlords and public buyers often prefer a German counterparty, and marketplaces may ask for German registration details for sellers who store goods there.

It fits less well if you want a holding company or a low-cost base with no German activity. The combined tax rate, the notary step and the ongoing accounting duties make it one of the more demanding options in Europe.

Tax residence follows where the company is managed. A GmbH run entirely from another country may face questions from both tax authorities, so plan where the managing director works and where decisions are recorded (confirm with your specialist).

If you need an EU company but not a German one, your specialist can compare Poland or Lithuania, which have lower rates for small companies, before you pay.