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- Hacker News
- Going from the scheduled notary appointment to having the first company registered comes out to 17 days in the timeline. 24 days if you add the time for getting the notary appointment. From experience, getting your tax id will take another four weeks or so, depending on your local tax authority. OP is still in that four week window, starting from the point where the paperwork was filed. So about 2 months total of processes you can't speed up.
But notably in OP's case, most of the time is actually spent with the lawyer and tax advisor, no the bureaucracy itself. The more complicated company structure (Ug & Co KG is basically one company (an UG) owning another (a KG), giving a very similar structure to an UG at a slight tax advantage), doesn't help, but it's really not where the majority of the time here is lost (it probably does account for about half of the money though)
by wongarsu - Why so little? You are priviledged!
Imagine 3 young Italians that would like to work together in a startup. Let's consider only the first year, imagine a B2B SaaS, they are incorporating but they'll work on the product and approach possible customers. Zero revenue.
Well, if you followed the law, you probably would spend something between 23'000€ and 25'000€ in total. WITH NO REVENUE. This is because even if you work for free for your company, you still have to pay taxes for INPS, our pension system.
And if someone invests in your company, you can't live out of nothing and would like to pay a founder even the minimum salary, YOU HAVE TO PAY INPS AGAIN.
This is crazy, our country is a joke.
EDIT: Adding a bit more of scary context and nice sprites.
None of the common financial advisor you find in Italy have ever heard of funding ways or contract terms that are really well known globally.
Do you want to include drag along and tag along clauses in your company statute? You have to talk with really expert lawyers and notaries in Milan that will bill you thousands of € for something that in Delaware is a pretty much standard single line of text.
by Lucasoato - Having to pay into the social welfare system you benefit from :O :O :O :Oby philipwhiuk
- That sucks, my fellow Italian. I haven't looked into our country since I live abroad for a long time, but I'm also paying health insurance here which is not cheap at all, and haven't added it to the post since it's not necessarily a company spend.
Cordiali saluti!
by earcar - The authors claim that he spent "9,600 euros to start a company" is misleading. Since he wants to reduce his liabiliy and therefore the risk of his customers as much as possible, he opted for a complex solution that involved founding two joined companies.
In addition, he counted 2,000 € of shared capital as an expense, which it isn't. He did not opt for a "cheap" UG which requires no up-front capital, because of its bad reputation.
He also includes a bill for accounting software of 426.97 € into his calculation. This has nothing to do with founding costs, but are operational expenses.
As the author states that he set up the company through a law firm, I wonder which of the figures includes the cost of this service. To be fair, this should be listed separately, as such costs can vary widely or be omitted entirely if the company is incorporated solely through a notary.
Also the information about the minimum deposit when founding a GmbH is incomplete. He states: "A GmbH wants 25,000 euros sitting in a bank account before it is allowed to exist." Fact is that you need only deposit half of it upfront into the GmbH; you only have to deposit the rest of the money if the company is in trouble. The company can also immediately lend the deposit back to the founder at market rates. If the company’s articles of association permit it to hold shares in other companies, the company may also use the contributions to purchase shares or similar financial investments. His law firm should actually have advised him on this matter.
The main differences between a standard GmbH and a GmbH & Co KG lie in their somewhat different tax arrangements.
So all in all, the author paid 7,227.74 € to found a rather complex company structure. Judging by his reasoning, presumably for the wrong reasons.
When I found a GmbH in 2019 without the help of a law firm, it cost me about 2,000 euros (if I recall it correctly).
by Archelaos - Do you understand why the notary fees are €1,575.24? That's astonishingly high for (I presume) a couple hours of work at most.
- I also had the impression that either we didn't get the full story or his law firm didn't really advise him very well.by steve1977
- I founded a UG in december for 250€ (beglaubigt.de) + 180€ (notary but w/ Mustervertrag) + 150€ (round about, not a 100% sure, Handelsregister) and 35€ Gewerbeanmeldung (which isn't even tied to founding the company itself relly). Still waiting for my UStID tho. supposedly exists since january, but they aren't able to deliver the letter or tell me on the phone ...by RamblingCTO
- For information: GmbH & Co. KG is one of the most complicated forms an company can be founded, the same goes if the inner company is an UG. Many things have to be done twice. The only good thing is that an investor or an owner are not liable with their private money.by stop50
- He wanted to go all out and maximise "company form". Same as optimizing your website for hundred of thousands of visitors even if you have only like one hundred visitors...by Bombthecat
- It is not complicated, it is in fact quite standard here in Germany.
I explain in the post how the other options are worse.
by earcar - > The only good thing is that an investor or an owner are not liable with their private money.
That’s incredibly important. More than a footnote. I would consider any other form to be non-viable if it doesn’t have such protections.
For comparison, starting an LLC in the United States is a trivial operation. I can’t even remember how long it took me to set mine up because it was a trivial event. Maybe a couple hours, mostly research? I also have to fill out an online form and pay a few dollars every year to renew the LLC.
by Aurornis - > 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.
But it was his call. As the author has already pointed out, he could have started a sole proprietorship, but he did not want to take on that risk. The 25'000 is because it's not his risk if he starts a GmbH, it's the GmbH's risk.
Also, the 25'000 are not a toll, it's the company's Stammkapital. The GmbH owns that money. And afaik, in Germany you only have to pay in half of the 25k.
- You can also use the stammkapital right away but there are certain rules when you have to prevent insolvency. It’s really not that hard unless you want something wild
- No one of your debtors - ever - will see any of these 25000. If you file for bankruptcy / insolvency, your insolvency manager and the processes of dissolving the company will swallow that money before it sees the light of day.
- I can't verify if the author's attempts are even real tbh. Sounds like they were creating problems for themselves just to see how much it would cost to get sort them out. For a GmbH you also want to get an accountant and just delegate the whole process to people who can guide you before you hurt yourself.by isodev
- Yes, can confirm. You can start a GmbH with exactly half of it (12.500€). And the money does NOT need to stay locked on the bank account. You can spend it for company purposes (but NOT for founder wages).by preya2k
- 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 themselves and it went smoothly. It's not that it can't be done, it's more that OP chose an overly complicated and untypical scheme and was surprised about the complications.
by weinzierl - I incorporated a GmbH with Musterprotokolle and it still look me longer than OP.by nish1500
- Especially the combination of UG & Co KG. Never heard that one!by flopbob
- > If you want a GmbH quickly there are specialized lawyers that maintain a pool of freshly founded GmbH's for you to buy.
That. It's possible to go even simpler if no limited liability is needed.
Just Gewerbeanmeldung costs maybe 30€ and takes less than a month normally. Large cities even have online forms for this.
Also the reporting duties are much simplified. ChatGPT and some accounting software are very helpful. Although a tax consultant and probably a liability insurance are recommended to avoid bad surprises.
by blablabla123 - > 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.
by earcar - > If you want a GmbH quickly there are specialized lawyers that maintain a pool of freshly founded GmbH's for you to buy.
The fact that this absurd situation exists is a huge proof that the bureaucracy has gotten out of hand and that Germany is unfriendly to starting new businesses.
- Germany is one of the worst countries when it comes to bureaucracy nothing is fast here if you go the legal path and stay within the law (which is mostly for small people big players have different ways) and as you see everything costs a lot so if you are founding a pure online business do yourself a favor and incorporate somewhere else and if you still live in Germany look into licensing or subcontracting yourself to your company in another country it's way more flexible and you probably have Easier access to grants etc.
Another part is taxation the tax office takes your money really fast but returns can be another slog where the tax office denies legal claims again and again untill you get a lawyer etc. and it generates costs again needlessly because it's really dependent on who works on your tax records and there mood apparently.
by robtro - It's the scientific slash managerial state brought to you by Anglo-German leftist thinkers of the 19th century. Enjoy utopia.
- Doesn't Germany have Controled Foreign Company rules?by nopurpose
- 100% agreed! Reality is, many german businesses are just flying under the radar, as they simply dont want or cannot deal with all the tax crazyness and bureaucracy.by sliqqq
- I never had any issue with Finanzamt being slow, they take my money with a proper disclosure ahead and also as quickly pay whatever I’m owed back
- > nothing is fast here if you go the legal path and stay within the law
> and as you see everything costs a lot
this sounds like a system primed for corruption
if you can pay half the needed amount to do everything 5 times as fast, would you not do it?
by NooneAtAll3 - I do not know an EU or Asian country that doesn’t have a similar paperwork misery; I had a company in DE and in many others; you won’t survive in Spain as SL if you are small and follow the rules either. So literally no one does. No different in DE. We never got fined or even reprimanded. Largest fine in DE we got was for charging the wrong VAT for some items and that was not really that bad compared to all the tax breaks we got.by anonzzzies