To set up a GmbH in Germany you need €25,000 of share capital, of which at least €12,500 must be paid in at formation, articles of association certified by a notary and registration in the commercial register (Handelsregister). With little capital there is the Unternehmergesellschaft (UG), from €1. Here is the path, step by step.
GmbH, UG or sole proprietorship
- Sole proprietorship (Einzelunternehmen). The fastest route with no minimum capital, but you are liable with all your personal assets.
- GmbH. Separates your assets from the company’s. Requires €25,000 of capital, with at least €12,500 paid in at formation.
- UG (haftungsbeschränkt). A GmbH with less than €25,000 of capital, from €1. Each year it must put a quarter of its profit (less losses carried forward) into a statutory reserve.
The steps, in this order
Articles of association or model protocol
The articles set out the name, registered office, purpose, capital and management. With at most three shareholders and one managing director you can use the model protocol (Musterprotokoll): faster and cheaper, but without rules of your own. If you have co-founders or expect investors, your own articles are usually worth it.
Notarial deed
The articles must be certified by a notary. At the notary the managing directors are also appointed and the application to the commercial register is prepared.
Business account and payment
You open an account in the name of the company in formation and pay in the capital: at least €12,500 for a GmbH, the full amount for a UG.
Registration in the commercial register
The notary files the company with the Handelsregister. Before registration, the GmbH does not exist as such. Anyone who acts in its name beforehand is personally liable. So it is best to sign major contracts after registration.
Trade registration and tax office
After registration you register the business (Gewerbeanmeldung) with the municipality. The tax office (Finanzamt) sends you the tax registration questionnaire, which you file electronically through ELSTER. There you also decide whether to use the small business scheme (turnover of at most €25,000 in the previous year and at most €100,000 in the current year).
Bookkeeping from day one
A GmbH must keep books and prepare annual accounts under the Commercial Code (HGB) each year: as a small company, within six months of the year end. They are published in the company register (Unternehmensregister) no later than twelve months after it.
Costs
The notary and the register charge official fees that depend mainly on the capital and the route you choose. The model protocol is usually cheaper. We get the notary’s quote for your case.
Common mistakes
- Acting in the GmbH’s name before registration. Until then you are personally liable.
- Using the model protocol when an investor will soon come in. Every later change goes back through the notary.
- Treating the capital as personal money. It belongs to the company.
- Forgetting the UG reserve. A quarter of the profit goes to the reserve.
- Leaving the bookkeeping until year end. VAT is generally filed every quarter or every month.
Your checklist
- Legal form chosen: GmbH or UG.
- Articles of association or model protocol.
- Notarial deed.
- Account opened and capital paid in.
- Registration in the commercial register.
- Trade registration and tax registration questionnaire.
- Bookkeeping from day one.
If you like, we do it with you: we choose the legal form, coordinate notary and bank and set up the bookkeeping for the start. Formation has a fixed price.
Figures checked against official sources on 29 October 2026. They change every year, so confirm them before you act.