Oliver Eidel ·
March 06, 2026
An Efficient German Company Setup (GmbH)
Some friends of mine are currently setting up a company in Germany (GmbH), and their questions have prompted me to write up a sort-of "guide" on everything I learned while running 3 companies in Germany for 5 years or so.
So if you're considering founding a small-ish company here in Germany, this guide is for you, because it'll save you an epic amount of time.
If you didn't know it yet, the experience of founding and running a GmbH in Germany is somewhere between "cumbersome" and "a complete shit-show". This is my attempt to soften the blow you will experience once you leave your sheltered employee-job and get exposed to the full crappiness of German bureaucracy. Let's get started!
So if you're considering founding a small-ish company here in Germany, this guide is for you, because it'll save you an epic amount of time.
If you didn't know it yet, the experience of founding and running a GmbH in Germany is somewhere between "cumbersome" and "a complete shit-show". This is my attempt to soften the blow you will experience once you leave your sheltered employee-job and get exposed to the full crappiness of German bureaucracy. Let's get started!
Tax Advisor
The #1 priority of running a GmbH is to have a tax advisor which doesn't suck. This is harder than it sounds, because it seems that this job tends to attract weird people. Still, it's possible. The rough requirements for a great tax advisor are:
- They respond to emails. This is rare.
- They are actually pragmatic people, e.g. they're able to handle "edge case" scenarios like "we went on a company off-site in Spain with 2 employees and 1 contractor" - surprisingly hard for most tax advisors.
- They don't over-bill you. I've paid anywhere between 100€ and 1k€ for monthly bookkeeping, crazy.
- They have a software stack which is not dysfunctional. Also really rare. We found a tax advisor which uses "BuchhaltungsButler", a startup-like software for bookkeeping, which turned out to be a blessing because it gives you some control over your bookkeeping and has an API for some automation. Most tax advisors use the "Datev" stack, which tends to suck quite a bit.
How do you find one? I've tried finding them through Google Reviews and Google Searches, but the short answer is that those are useless here. Instead, ask your entrepreneur-friends for recommendations. Especially those friends which are actually running their own profitable, small business, because those are exposed to the day-to-day work with tax advisors. Contrary to that, asking people who run mid-size (10+ people) companies, optionally with VC investment, is often not useful, because they no longer are exposed to the crappiness of their tax advisors.
As a side note, you might think "hey, can't I just do bookkeeping and taxes myself?" The answer is No, because that will easily turn into a full-time job. As a GmbH, you need to do double-entry bookkeeping which stands for "an epic amount of overhead and a job-creation scheme". Also, the yearly bookkeeping (Jahresabschluss) tends to be 30-60 pages of tax forms, so yeah.. another job-creation scheme for tax advisors. Which brings me to bookkeeping!
As a side note, you might think "hey, can't I just do bookkeeping and taxes myself?" The answer is No, because that will easily turn into a full-time job. As a GmbH, you need to do double-entry bookkeeping which stands for "an epic amount of overhead and a job-creation scheme". Also, the yearly bookkeeping (Jahresabschluss) tends to be 30-60 pages of tax forms, so yeah.. another job-creation scheme for tax advisors. Which brings me to bookkeeping!
Bookkeeper + Salary Bookkeeping
This one's interesting. Some tax advisors offer (read: "force") you to choose them for your monthly company bookkeeping (Finanzbuchhaltung). This might work, or it might not. The problem is that you're locked in, and if they're incapable, you can't swap them out for a capable bookkeeper. This happened at our last tax advisor. The person was friendly, but simply very slow and borderline incapable. That meant our monthly bookkeeping cost up to 1k€, crazy!
At our new tax advisor, they let you choose (and find) and own bookkeeper. We found ours through Upwork and she's awesome. It also reduced our bookkeeping costs from 1k€ / month to 100-300€ / month, nice.
Besides the monthly bookkeeping (Finanzbuchhaltung), you also need a monthly salary bookkeeper (Lohnbuchhaltung). The background here is that, apparently, doing salary calculations in Germany is so complex that you need to hire specialized people to do it. Did I mention that all of this is a job creation scheme?
Whether to outsource this or not is a bit more tricky. My experience here has been that it's actually alright to let you tax advisor do this, because the coordination overhead when choosing an external company tends to be significant. And the costs tend to be not-so-high, e.g. 10-20€ per employee per month. So here it might be a good choice to work with your tax advisor. If however they don't have capacity for you right now (this happened to me, as always), you'll have to search for an external provider. And with all things about bureaucracy, most of them suck; even worse, some of them will outright decline you as a customer because they e.g. only take on companies with 5-10+ employees or so. Good luck.
At our new tax advisor, they let you choose (and find) and own bookkeeper. We found ours through Upwork and she's awesome. It also reduced our bookkeeping costs from 1k€ / month to 100-300€ / month, nice.
Besides the monthly bookkeeping (Finanzbuchhaltung), you also need a monthly salary bookkeeper (Lohnbuchhaltung). The background here is that, apparently, doing salary calculations in Germany is so complex that you need to hire specialized people to do it. Did I mention that all of this is a job creation scheme?
Whether to outsource this or not is a bit more tricky. My experience here has been that it's actually alright to let you tax advisor do this, because the coordination overhead when choosing an external company tends to be significant. And the costs tend to be not-so-high, e.g. 10-20€ per employee per month. So here it might be a good choice to work with your tax advisor. If however they don't have capacity for you right now (this happened to me, as always), you'll have to search for an external provider. And with all things about bureaucracy, most of them suck; even worse, some of them will outright decline you as a customer because they e.g. only take on companies with 5-10+ employees or so. Good luck.
Bookkeeping Automation
Every month, you have to gather all invoices which you received, and all invoices your business sent out. Obviously, this is a lot of overhead because, well, you literally need a PDF invoice for every transaction which took place in your bank account that month - technically speaking, you even need PDF invoices for transactions which haven't happened yet, as long as the invoices were issued that month.
This quickly gets complicated because you're gathering a lot of PDFs every month. Typical examples here are Google Workspace, Slack, AWS, etc. I don't know how companies in other countries do it, but my gut feeling is that they don't overcomplicate things like this and actually get business done.
Anyway, roughly speaking, the work can be grouped into these categories, and here's how you can optimize them:
This quickly gets complicated because you're gathering a lot of PDFs every month. Typical examples here are Google Workspace, Slack, AWS, etc. I don't know how companies in other countries do it, but my gut feeling is that they don't overcomplicate things like this and actually get business done.
Anyway, roughly speaking, the work can be grouped into these categories, and here's how you can optimize them:
- Getting the PDF invoices via email: Most companies send you your monthly invoice via email. In that case, just set up a Gmail filter to auto-forward those emails (including the invoice PDF) to your bookkeeping software (e.g. BuchhaltungsButler). We actually built a small Rails application which extracts data from those PDFs and uploads that to BuchhaltungsButler, this saves our bookkeeper a lot of time.
- Manually getting the PDF invoices: Some companies don't send you a monthly invoice, e.g. ChatGPT. In that case, you have to log in manually and download it every month - fun. We hired a Virtual Assistant via Upwork to do this every month - we essentially provide a list of services (URLs) and credentials (limited privileges etc.) to log in to every month, and then the VA sends the PDF invoices via email to BuchhaltungsButler.
- Chasing down PDF invoices: This is an epic mess and it happens only rarely. Sometimes, companies fail to issue you a proper PDF invoices, this e.g. happens sometimes on Amazon. Because German bookkeeping is rather strict, it's now your job to chase them down to actually issue you a PDF invoice. No real optimizations here. Maybe OpenClaw in the future.
Bank Account Selection
This is a bit of tricky one. The priorities for a bank account are 1) you don't get randomly locked out, 2) it syncs well with your bookkeeping software and 3) it doesn't suck. Most Fintechs (including Wise / Revolut) don't suck, at least UI-wise, but they tend to randomly lock you out and they don't sync well with German bookkeeping software.
So the better choice here is to choose an old-school German bank. A benefit you get here is that you usually have a customer rep who you can message via email any time, and they are fairly responsive.
We chose Deutsche Bank - they are great in general, but sometimes a bit slow. Getting a Visa Debit card recently took 2 months. Wise is our backup. Syncing Deutsche Bank with BuchhaltungsButler is seamless, syncing Wise is not as it relies on a cobbled-together CSV export from Wise, then running that through a Google Sheets macro (!), then importing it into BuchhaltungsButler. Fun.
So the better choice here is to choose an old-school German bank. A benefit you get here is that you usually have a customer rep who you can message via email any time, and they are fairly responsive.
We chose Deutsche Bank - they are great in general, but sometimes a bit slow. Getting a Visa Debit card recently took 2 months. Wise is our backup. Syncing Deutsche Bank with BuchhaltungsButler is seamless, syncing Wise is not as it relies on a cobbled-together CSV export from Wise, then running that through a Google Sheets macro (!), then importing it into BuchhaltungsButler. Fun.
Postal Mail Scanning
Running a GmbH in Germany will confront you with the fact that this country still runs on physical snail mail. In fact, you'll notice this right after founding your company at the notary, as the notary will send the physical stack of founding documents to your new company address!
Unless you want to spend one afternoon per week walking to your office address (more on that below) to pick up physical mail, you should set up a mail scanning service. This is a service which receives your physical mail, scans it to a PDF with OCR (nice) and messages you via email that you've got new mail.
The contenders here are Dropscan, a Berlin-based private company, or Postscan, the official service by the German post office. The comparison is not even close - choose Dropscan. Their web UI and service are awesome, and I'm a customer with all my companies there (no affiliate commission, sadly). Postscan, like most "digital" services of the German post office, sucks tremendously.
Unfortunately, you can't fully avoid interacting with the German post office, because you have to set up a mail forwarding job from your official office address to the Dropscan address (which is more or less like a PO box). And the German post office has recently raised prices for this service significantly - it costs 54.90€, and lasts only 6 months, then you have to renew it. It's called Nachsendeservice. The important pointers here are to select "Geschäftskunde" and "vorübergehende Abwesenheit"; the whole system doesn't seem to be ready for a company (like yours) which is trying to digitalize things, so you're essentially pretending that you company temporarily moved its headquarters somewhere else (to the Dropscan mailbox).
And if your company is in Berlin, you're in for another surprise: Some areas in Germany like Berlin use multiple postal companies. Besides the German post office, there's also "PIN", which is a private company also delivering mail. Now, get ready for this, the Berlin tax office has chosen PIN for their physical snail mail which they'll send to your company, so you also have to set up a forwarding job with them, too, costing you essentially double. Here's the PIN website where you do it. The good news is that 1) PIN sucks much less than Deutsche Post, 2) it's cheaper and 3) you can book it for 24 months (vs. 6 months at Deutsche Post), so you only have to renew this every 2 years. The price is 79.90€ for 24 months. Same pointers here: Select "geschäftlich" and "vorübergehende Abwesenheit", and forward mail from your official office address to your Dropscan address.
Unless you want to spend one afternoon per week walking to your office address (more on that below) to pick up physical mail, you should set up a mail scanning service. This is a service which receives your physical mail, scans it to a PDF with OCR (nice) and messages you via email that you've got new mail.
The contenders here are Dropscan, a Berlin-based private company, or Postscan, the official service by the German post office. The comparison is not even close - choose Dropscan. Their web UI and service are awesome, and I'm a customer with all my companies there (no affiliate commission, sadly). Postscan, like most "digital" services of the German post office, sucks tremendously.
Unfortunately, you can't fully avoid interacting with the German post office, because you have to set up a mail forwarding job from your official office address to the Dropscan address (which is more or less like a PO box). And the German post office has recently raised prices for this service significantly - it costs 54.90€, and lasts only 6 months, then you have to renew it. It's called Nachsendeservice. The important pointers here are to select "Geschäftskunde" and "vorübergehende Abwesenheit"; the whole system doesn't seem to be ready for a company (like yours) which is trying to digitalize things, so you're essentially pretending that you company temporarily moved its headquarters somewhere else (to the Dropscan mailbox).
And if your company is in Berlin, you're in for another surprise: Some areas in Germany like Berlin use multiple postal companies. Besides the German post office, there's also "PIN", which is a private company also delivering mail. Now, get ready for this, the Berlin tax office has chosen PIN for their physical snail mail which they'll send to your company, so you also have to set up a forwarding job with them, too, costing you essentially double. Here's the PIN website where you do it. The good news is that 1) PIN sucks much less than Deutsche Post, 2) it's cheaper and 3) you can book it for 24 months (vs. 6 months at Deutsche Post), so you only have to renew this every 2 years. The price is 79.90€ for 24 months. Same pointers here: Select "geschäftlich" and "vorübergehende Abwesenheit", and forward mail from your official office address to your Dropscan address.
Office Address
The TLDR here is that it's often preferable to register your GmbH at an office provider address, e.g. a coworking space. Why? The problem is that if you register your GmbH at your private address and then start leasing space from your private house/flat to the GmbH (= the GmbH starts paying you rent), then the tax office is likely going to argue that this part of your property has become a "commercial business asset". This becomes problematic if/when your GmbH moves to another office address, or if you sell your flat/house in the future, because then technically you have to "remove" this commercial business asset from your business and pay taxes on its gains.
It's an epic mess. Sure, you could probably register your GmbH at your private address, but then you'd need to make sure you don't make your GmbH pay you rent. The safest bet is probably to choose an office provider address.
The prices I've seen range from 50-200€ / month. Running a GmbH is not cheap, and if you haven't noticed by now, there's a large group of friendly middlemen who are happy to take money off you.
There are some optimizations here - if you e.g. know another business with an office, they might be willing to sublease a "letterbox" to your business, assuming your business works remotely and doesn't need physical office space etc. Talking about which..
It's an epic mess. Sure, you could probably register your GmbH at your private address, but then you'd need to make sure you don't make your GmbH pay you rent. The safest bet is probably to choose an office provider address.
The prices I've seen range from 50-200€ / month. Running a GmbH is not cheap, and if you haven't noticed by now, there's a large group of friendly middlemen who are happy to take money off you.
There are some optimizations here - if you e.g. know another business with an office, they might be willing to sublease a "letterbox" to your business, assuming your business works remotely and doesn't need physical office space etc. Talking about which..
Rundfunkbeitrag
The "Rundfunkbeitrag" is a very weird concept in Germany, and every German I've talked to dislikes it strongly. The idea is that every household in Germany has to pay a fixed fee every month for the public television and radio stations. Note that this is regardless whether you actually watch them - it doesn't even matter whether you have an actual TV or not! You always pay. It's no surprise that it's very unpopular.
Well, guess what, when you incorporate your business, one of the first letters you get is about the Rundfunkbeitrag, because, well, you just moved into a "new office" (which might be a letterbox) and you're surely watching state TV in your new office (instead of getting work done).
The hack here is that if you're renting your office from an office service (coworking space etc.), then your office provider is likely already paying this for you and you're all set. However, if you're actually renting a new physical office somewhere, then you indeed have to pay this. It's around 10€ / month.
Well, guess what, when you incorporate your business, one of the first letters you get is about the Rundfunkbeitrag, because, well, you just moved into a "new office" (which might be a letterbox) and you're surely watching state TV in your new office (instead of getting work done).
The hack here is that if you're renting your office from an office service (coworking space etc.), then your office provider is likely already paying this for you and you're all set. However, if you're actually renting a new physical office somewhere, then you indeed have to pay this. It's around 10€ / month.
SEPA Direct Debits (Tax Office + Health Insurance)
The TLDR here is that if you have the chance to set up a SEPA direct debit anywhere, you should likely do it because it saves you the hassle of manually setting up bank transfers every month.
The #1 use case here is to set up a direct debit for the tax office (Finanzamt) so that they can deduct (or credit) your account with the monthly VAT payments (remember your monthly bookkeeping?).
Another good use case here is setting up a direct debit with the health insurance providers of your employees.
Oh wait, are you ready for this?
Germany currently has 93 health insurance providers, only counting the public ones. For employees, the fees are deducted from their salary and paid by their employer. There is no central "provider" of collecting these fees, so you have to pay each employees health insurance separately every month.
In the worst case, assuming you have 93 employees where each employee has a different health insurance, you're looking at 93 separate health insurance payments per month.
The good news is that you can set up a SEPA direct debit, but.. you'll still have to do it for each insurance company individually. All of them have paper forms and expect you to fill them out by hand and sending them via snail mail, good luck.
It gets better: Some insurances notify you if you've hired a new employee who is insured by them, and kindly send you an empty direct debit form (thanks). Other insurances just don't message you at all and it's up to you to notice that 1) you have a new employee who chose them, 2) find the crappy SEPA form from their website, 3) print it and 4) mail it to then.
Happened to me once, I thought Techniker Krankenkasse would send us a nice welcome letter and SEPA form - nope. We ended up paying additional late-payment fees a few months later when I set up the direct debit.
The #1 use case here is to set up a direct debit for the tax office (Finanzamt) so that they can deduct (or credit) your account with the monthly VAT payments (remember your monthly bookkeeping?).
Another good use case here is setting up a direct debit with the health insurance providers of your employees.
Oh wait, are you ready for this?
Germany currently has 93 health insurance providers, only counting the public ones. For employees, the fees are deducted from their salary and paid by their employer. There is no central "provider" of collecting these fees, so you have to pay each employees health insurance separately every month.
In the worst case, assuming you have 93 employees where each employee has a different health insurance, you're looking at 93 separate health insurance payments per month.
The good news is that you can set up a SEPA direct debit, but.. you'll still have to do it for each insurance company individually. All of them have paper forms and expect you to fill them out by hand and sending them via snail mail, good luck.
It gets better: Some insurances notify you if you've hired a new employee who is insured by them, and kindly send you an empty direct debit form (thanks). Other insurances just don't message you at all and it's up to you to notice that 1) you have a new employee who chose them, 2) find the crappy SEPA form from their website, 3) print it and 4) mail it to then.
Happened to me once, I thought Techniker Krankenkasse would send us a nice welcome letter and SEPA form - nope. We ended up paying additional late-payment fees a few months later when I set up the direct debit.
Conclusion
Looking back, what are the biggest levers? Ranked by impact, I'd say:
- Get a pragmatic tax advisor - spending hours / days discussing trivial stuff with tax advisors is extremely annoying.
- Automate your bookkeeping - set up Gmail filters, use a bookkeeping software which offers receiving invoices via email (most of them do).
- Outsource trivial tasks - bookkeeping, VA for invoice downloading, etc.
- Use all the "set it and forget it" automations which are available, e.g. mail scanning, SEPA direct debits, etc.
Any questions? Comment below. Good luck!
Leave a comment. Or send me a message on LinkedIn.