Some of the types of companies in Germany that may be considered for entrepreneurs and even foreign investors looking to invest in the country include: the limited liability company, joint stock company, limited partnership, general partnership, civil law partnership, sole proprietorship, and branch office. The experts of our German company formation team can help you to choose the best business form for you and its specific procedures.
| Quick Facts | |
|---|---|
| Main types of companies/structures in Germany | – limited liability company (GmbH), – joint stock company (AG), – limited partnership (KG), – general partnership (OHG), – civil law partnership (GBR), – sole proprietorship |
Foreign entities in Germany | – branches, – subsidiaries, – representative offices |
Minimum share capital | – EUR 25.000 for GmbH, – EUR 50.000 for AG |
| Remote company formation (YES/NO) | YES |
| Bank account required for share capital (YES/NO) | YES |
| General steps to open a company | – choose company name, – draft and notarize documents, – submit required capital, – register with Commercial Register, – register with tax authorities, etc. |
| General required documents | – application form, Articles of Association, – proof of deposited share capital, – ID documents of directors & shareholders, – proof of address, – power of attorney for our German lawyers, etc. |
| Special licenses and permits | For specific industries (food and beverage, hospitality, transportation, finance, construction, etc.) |
| Corporate income tax rate | 15.825% + local tax rate based on municipality |
| Personal income tax for sole traders |
Progressive rates, based on earned income. Our attorneys in Germany can give you the exact rates. |
| VAT registration | Mandatory for all taxable activities in Germany, but some exceptions apply to sole traders. |
| VAT rates | – 19% (standard), – 7% (reduced) |
| Minimum shareholders required | 1 for both GmbH and AG |
| Virtual office possibility (YES/NO) | YES |
| Assistance | Our law firm in Germany can help you with selecting the appropriate business structure and with the incorporation procedure. |
Table of Contents
What services do you offer in terms of company types in Germany?
Our German lawyers and company formation experts will assist you and your business in setting up a company in Germany. We offer the following services:
- Selection of the most appropriate company form in Germany according to the customer’s activities and goals;
- Incorporation of GmbH, AG and partnerships;
- Sole proprietorship and branch office establishment;
- Preparation and check of incorporation documents;
- Coordination of notarization and registration with the appropriate German authorities;
- Helping to set up a corporate bank account and capital;
- Selection of the registered office and management;
- Help with the preparation of the necessary documents for foreigners wishing to set up a business in Germany.
Which are the types of companies available in Germany in 2026?
The most common businesses types in Germany are:
- the limited liability company (GmbH): the most widely used business form, it is suited to small and medium-sized businesses. Our team can help you start a limited company in Germany.
- the joint stock company (AG): similar to the GmbH in terms of shareholder liability only that it can trade its shares and it is thus most suited to large corporations.
- the limited partnership (KG): a collaboration between two partners where at least one of them is subject to unlimited liability.
- the general partnership (OHG): the partners are liable for the debts and obligations of this business form and will share the profits.
- the civil law partnership (GBR): functions following the same principles as for the limited partnership where the two partners have unlimited liability but do not have to pursue a commercial purpose.
- the sole trader: the simplest business form where one individual sets up the business and has unlimited liability for the debts and obligations that arise.
- the German branch office: an extension of the parent company abroad, it is used by foreign corporations that wish to enter the market.
What are the requirements of the German Limited Liability Company (Gesellschaft mit beschränkter Haftung)?
The limited liability company is the most widely-used type of business. Only one founder is required for its formation and he can also be a shareholder. A particularity of the German limited liability company is that its name has to refer to the nature of the business or the name of the shareholder followed by GmbH.
The share capital of a limited liability company must be at least 25,000 euros from which 12,500 have to be deposited in a corporate bank account during the registration procedure. The shares of a GmbH cannot be traded on the stock exchange and they are not certificated either. Our lawyers can help open a bank account in Germany and deposit the share capital.
Here is also an infographic on this topic:
How can I start a German Joint Stock Company (Aktiengesellschaft)?
In order to start a German joint stock company one needs a capital of 50,000 euros and must be registered in the Register of Companies. A joint stock company requires one shareholder, and there are no restrictions on the number of shareholders that can be appointed. Also, there are no restrictions or requirements on the nationality of the shareholders. The board of directors will have the right to decide on the operational aspects of the company, as well as on its management.
What are the requirements to open the Limited Partnership (Kommanditgesellschaft) in Germany?
To start a German limited partnership you need a capital of 50,000 euros. This capital has to be split into shares. The business has to be registered with the Trade Register and the articles of associations have to be notarized. This type of company has a general partner who is the main representative and wholly liable for the company while the limited partners are only liable up to the value of the shares owned in the company. This type of legal entity is more suitable for small and medium sized enterprises (SMEs).
How can I start the General Partnership (Offene Handelsgesellschaft) in Germany?
In order to start a general partnership in Germany there is no need for capital, as each partner has unlimited liability. A general partnership has to be registered with the Trade Register and has to bear the OHG abbreviation at the end of the name for clarification or liability. The structure of a general partnership has to be a board of directors and a supervisory body. An important aspect when forming a general partnership in Germany is that accounting procedures are different (and simpler) than in the case of other types of legal entities. Also, it is necessary to have at least two associated partners in order to start a general partnership.
You can also watch a short video on the types of companies in Germany:
What are the procedures to start a Civil Law Partnership in Germany?
To start a civil law partnership it takes two partners with unlimited liability. The German civil law partnership has to be registered with the trade office if it is a small trade business. If the annual profit exceeds 25,000 euros it will become a commercial business, therefore it will be considered a general commercial partnership (oHG) and it will have to be registered with Commercial Register. The partners should sign a partnership agreement. The regulation is not compulsory, but it is recommended.
How the sole proprietorship (Einzelunternehmen) in Germany works?
A sole proprietorship is a common type of business structure in Germany. It is a form of business where an individual operates a business on their own without forming a distinct legal entity. Our law firm in Germany also handles sole proprietorship registrations.
The sole proprietor is the sole owner and operator of the business. There are no partners or shareholders involved. Unlike some other business forms in Germany, there is no minimum capital requirement for establishing a sole proprietorship. However, the owner is responsible for financing the business and its operations. If the business incurs debts or faces legal claims, the owner’s personal assets, including their home and savings, can be used to cover these obligations.
How branch offices work in Germany?
A branch office is a suitable type of business in Germany for foreign companies that want to establish a presence in the country. It serves the purpose of initiating business activities and maintaining contacts with business partners. Our German lawyers can also assist with branch registrations.
There are two types of branches in Germany:
- Autonomous branch office: This type of branch office operates with a higher degree of independence from the foreign head office company;
- Dependent branch office: A dependent branch office has a closer relationship with the foreign head office and operates with less independence.
What are the general company formation steps in Germany?
Below, we present the main steps to open a limited liability company, the GmbH, the most common company type in Germany:
- Choose the company name;
- Draft the documents;
- Notarize the documents;
- Submit the capital;
- Register the GmbH.
Entrepreneurs who wish to know more about company formation, the different business forms and the specific requirements for each one can contact our German law firm.