Starting a business in Germany: a checklist from registration to the first invoice
Starting a business in Germany involves several authorities, but the steps follow a clear order. This checklist covers what founders of small businesses typically need, from choosing a legal form to sending the first correct invoice. Requirements differ for regulated professions and for non-EU citizens, so check your case with the local chamber or a tax adviser.
Choose the legal form
Most small businesses start as a sole proprietorship or as freelancers, which need no minimum capital. A UG or GmbH limits personal liability but requires a notary, an entry in the commercial register and more extensive accounting. Partnerships suit several founders. Choose based on liability, costs and plans, not only on taxes.
Register with the authorities
The order matters, and most steps can be completed online:
- Trade registration at the local trade office, unless you work in a liberal profession.
- The tax registration questionnaire via ELSTER within one month of starting.
- Automatic membership of the chamber of commerce (IHK) or the chamber of crafts (HWK).
- Commercial register entry for a GmbH, UG or registered merchant.
- Permits for regulated activities, such as certain trades or catering.
Decide on VAT: the small business rule or not
Since 2025, the small business rule applies if turnover was no more than €25,000 in the previous year and does not exceed €100,000 in the current year. You then charge no VAT but cannot reclaim input VAT. If you mainly sell to businesses or invest heavily at the start, opting for regular VAT can be better.
Insurance, bank account and bookkeeping
Health insurance is mandatory, also for the self-employed. Check business liability insurance and, depending on the activity, other cover. A separate business account makes bookkeeping easier and is needed in practice for a GmbH. Set up bookkeeping from day one: keep receipts digitally and send invoices with all mandatory details.
Website and first customers
A business website needs an Impressum and a privacy policy. Add a Google Business Profile if customers visit you or you serve a local area. Plan the first customers before the launch: whom do you know, which offer can you test quickly, and how will you ask for reviews?
Example: opening a café
A founder opening a café registers the trade, asks the local authority whether a catering licence is needed (this depends on the federal state and on whether alcohol is served), attends the health instruction required by the Infection Protection Act, registers the POS system with the tax office and sets up a Google Business Profile with opening hours before the first day.
Frequently asked questions
- How long does it take to start a business in Germany?
- A sole proprietorship can be registered within days. A GmbH usually takes a few weeks because of the notary appointment and the commercial register.
- Can non-EU citizens start a business in Germany?
- Yes, but they need a residence permit that allows self-employment. Check the requirements with the immigration office before registering.
- Do I need a tax adviser?
- It is not mandatory, but for the tax registration and the choice of VAT rules, an initial consultation often saves more than it costs.
Sources
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