We look forward to hearing from you. The best way to contact us is by phone or e-mail.
Contact
RA Benjamin Schreiber
Leonrodstr. 54
D-80636 Munich
(Click for view on Google Maps)
We look forward to hearing from you. The best way to contact us is by phone or e-mail.
RA Benjamin Schreiber
Leonrodstr. 54
D-80636 Munich
(Click for view on Google Maps)
If you are working on setting up a company in Germany, it is practically impossible to avoid dealing with the "good ole
GmbH", the limited liability company. There are over 800,000 of these companies in Germany today. After sole
traders, this is by far the largest group. The small ‘companies’ with 10 or fewer employees also clearly predominate.
The GmbHconsists of one or more managing directors and the shareholders' meeting. GmbHs with many employees
(>500) also require a supervisory board.
The GmbH is a classic corporation. Its great attraction, as the name suggests, is that it minimises the personal
liability of the shareholders. In practice, however, this protection comes at the price of a whole series of
necessary formalities, which generally also cost quite a bit. The defining feature of a GmbH is the required
minimum share capital of 25,000 euros. This serves as security for customers and business partners and is
therefore an important ‘confidence gauge’ for the commercial activities of the GmbH. Sole traders in services
in particular, who involve a certain amount of financial risk, are therefore faced with the question of whether
it is worthwhile or sensible for them to set up a GmbH.
GmbH formation compact
• The GmbH is still one of the most popular company forms for company founders in Germany.
• The advantages of the GmbH lie in the well-limited economic risk and the simple transferability of shareholdings.
• The main disadvantages are the extended accounting requirements and possibly unnecessary multiple taxation.
Do you want to set up a GmbH?
Whether you are already an experienced entrepreneur or a real ‘start-up’ -
with many years of experience in company law, commercial law and labour law, I can support you in almost all
legal matters when founding your GmbH in Munich or throughout Germany. Firstly, I can analyse the formation of
the GmbH in a targeted manner, then plan and implement it successfully, avoiding risks and thus laying the
foundation for sustainable economic success together. With my many years of legal and business management experience,
we can also make your GmbH formation as stress-free and successful as possible.
Contact us for legal advice/initial consultation - in person, phone, video call.
In addition to limiting liability risks, it is the existence of a mandatory share capital that offers a better reputation. Business partners and customers can therefore better assess the risk they are taking when doing business with a GmbH. Compared to many other company forms and sole proprietorships, this can be very important in day-to-day business, whether you receive orders or not. Another advantage is that the shareholdings in the GmbH remain flexible and can be changed relatively easily.
The main disadvantages of a GmbH are, of course, the extended accounting obligations. In practice, these require
a not inconsiderable amount of time and money. Withdrawals from the GmbH can also result in multiple taxation
(including trade tax), which you would not have as a sole trader. This is where it can be interesting for many
people to look into other company forms or even the possibility of freelancing.
Managing director liability is also important, as the actual founder often also takes on this position, but does
not have extensive legal and business knowledge. Without external help or advice, you are taking a risk here,
which is precisely what you wanted to reduce by choosing to set up a GmbH. There is also always a residual risk
of recourse liability in the absence of expertise.
Last but not least, the formation of the GmbH itself is quite complex. In addition to notarisation, an entry in
the commercial register is mandatory. Unexpected follow-up costs (chamber of commerce) are then added.
The articles of association may also need to be amended in the future, which in turn entails costs and expenses.
A lawyer is not mandatory when founding a GmbH, but it does offer some advantages. Firstly, with the help of a lawyer it can be clarified whether a GmbH is the right legal form for the planned company. This question is always appropriate, especially for founders who are starting out without many employees. The same applies to people who are eligible to be categorised as freelancers but who do not benefit from improved liability issues. Borderline cases in particular must be analysed in detail and assessed on a case-by-case basis. For example, a software developer can work excellently as a freelancer, but not having a company in the background can have a negative impact on the acquisition of customers and projects. Large projects and orders from major and industrial customers are particularly difficult to acquire without a suitable company form.
However, a lawyer can also provide further assistance after providing specific advice on the company form. A customised partnership agreement can be particularly useful if several shareholders are involved in the formation of the GmbH and there are individual interests to consider. In principle, the following always applies here: Anyone who has successfully founded a GmbH with a lawyer already has the good feeling of having experienced legal advice for future legal issues.
A GmbH offers the advantage of limited liability for its shareholders. Nevertheless, certain circumstances can lead to personal liability. A lawyer can inform you about your legal obligations as a managing director or shareholder and help you to minimise liability risks (see also Managing director liability).
The formation of a GmbH naturally also has tax implications. The lawyer can inform you about the tax obligations and opportunities associated with the formation and management of a GmbH. They can also help you to optimise the tax structure of your company in order to minimise taxes and avoid tax risks.
Last but not least, legal advice when setting up a GmbH can also prevent legal problems that you could not recognise yourself. Trade mark and copyright aspects in particular are often neglected by founders in the euphoria of setting up a company. An experienced lawyer will be able to examine and recognise problems of this kind in advance.
Expertise is not about holding titles - it is about constant, professionally correct, practical work over many years.
Every case is different - as a lawyer, every case requires its own individual approach in order to do justice to the subject matter and the client.
Legal standards alone do not solve cases - efficient communication between lawyer and client, but also with the opposing party, ensures real results.
Serving various areas of law with specialised lawyers to represent personal and economic interests.
We stand for personal advice, constant availability and professional expertise in foundation of a GmbH in Munich.
+49 (89) / 139 284 10