It is not only well known for its major industrial companies, but also for its specialized small and medium enterprises, proudly known as the “Mittelstand”. More than 1,000 of these companies are global market leaders in their field of expertise and are labelled as “Hidden Champions”.
Law & Taxation
Germany has a traditional civil law system based on Roman Law principles and influenced by the Napoleanic Code. Generally, it is composed of Public Law (öffentliches Recht) and Private Law (Privatrecht).
As part of Public Law, Germany defines over 30 different taxes. The type of taxes a business must pay depends on the legal form of the business and the nature of its business. These taxes are distributed between the federation (Bund), the states (Länder), and the municipalities (Gemeinden). Even non-residents are liable if they have certain types of income in Germany. However, the amount of tax may be reduced by various deductions and allowances.
Generally, all products and services are subject to value-added tax (VAT). Other types of tax include income, corporation, trade, real property, inheritance, capital gains, aviation and motor vehicle taxes. Additionally, employment income earned in Germany is subject to mandatory insurance contributions covering health, pension, nursing and unemployment insurance.
In contrast to Public Law which defines the rules between the state and its citizens, Private Law determines the relationships among individuals and corporations. The most important private law is the famous German Civil Law Book (Bürgerliches Gesetzbuch, BGB). It was put into effect on January 1, 1900, and has been the central codification of civil law ever since.
The primary form of business organisation are the stock company (Aktiengesellschaft, AG), the company with limited liability (Gesellschaft mit beschränkter Haftung, GmbH) and the limited partnership (Kommanditgesellschaft, KG).
German Corporate Law is open to the establishment of different types of businesses – regardless of whether or not it involves a German or a foreigner. However, the company must have a registered office in Germany. It further requires at least one director and a shareholder. A corporate director is not permitted whereas the shareholder can be an individual or a legal corporate entity.
Although the director can theoretically be a foreigner, it is recommendable to choose a local individual due to tax substance, legal, trade compliance and operational reasons.
Germany, known as the land of poets and thinkers, is one of the world’s most important business centers. Hence, all major banks, brokers and financial institutions are present. The same goes for many international legal and accounting firms. A stable government and a rich pool of highly qualified professionals are one of its greatest assets.
A sophisticated energy and communications infrastructure as well as first-class transportation networks ensure on-time delivery and short roads to success. Additionally, Germany is the world's leading trade fair location as more than two thirds of the world's leading trade fairs take place in Germany.
Vistra has been offering shelf companies in Germany for many years. You can either purchase a Shelf-GmbH available for immediate purchase or require a complex company structure.
The shelf companies are provided with a complete company kit including all relevant statutory documents. The Shelf-GmbH has a bank account with a fully paid share capital of EUR 25,000, a business address in Berlin, Cologne, Frankfurt am Main, Hamburg or Munich and two experienced managing directors who can be dismissed or retained depending on your needs.
If necessary, we can additionally offer a full package of corporate services, from domiciliation and director services over accounting, tax compliance and payroll to liquidation services. In this sense, we offer tailor-made solutions, including the establishment of multi-level corporate structures, e.g. for M&A and real estate transactions, as well as the administration of long-term management equity programs.
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