Establish Your Company in Bavaria

Anyone Can Establish a Company

Anyone can establish a business in Germany - irrespective of nationality or place of residence. Entrepreneurs are classified as either business persons (Kaufleute) or freelancers (Freiberufler), and dealt with by the tax authorities as "self-employed per-sons". Especially terms of tax the two groups are dealt with differently.

A business person is anyone who operates his or her own business in the area of industry or the skilled crafts. A business (operation) is any business activity that some-one conducts at their own cost, own responsibility, and with the long-term aim of achieving a profit. The business must only be registered with the trade licensing office. The necessity of registering in the commercial register depends on the legal form.

Anyone exercising a freelance profession must only register with the tax authorities and, depending on the profession, possibly with the relevant professional association. Trade tax payments are not levied. In principle, independently exercised scientific, artistic, writing, teaching, or educational activities are freelance professions. Anyone who works on one's one account as a doctor, lawyer, notary, patent lawyer, surveyor, engineer, architect, auditor, tax advisor, economic consultant, certified accountant, tax consultant, healer, dentist, physiotherapist, journalist, press photographer, interpreter, translator, or pilot is also a freelancer.

The Bank Account

Anyone running a company in Germany should have a bank account in Germany. To open a bank account, you usually need only a valid passport and a confirmation from the residents registration office that your place of residence is in Germany. In many banks, it is possible to have accounts in foreign currencies. Practically all large inter-national banks are represented in Germany.

Entry in the Commercial Register

The commercial register is a list of all business persons and business companies and can be viewed by anyone free of charge at the local court as well as online. It con-tains information on the names of the companies, their legal form, and their partners. Principally all business persons and companies are required to be registered in the commercial register. The application for entry into the commercial register must be submitted in a form certified by a notary.

Registering the Business

The first step when establishing a business as a business person is to fill out the business registration at the local trade licensing office, as a result of which the business is entered in the local trade register. The office forwards the registration to the tax authority, the regional association of professional trading associations, and the chambers of industry and commerce or chamber of skilled crafts. A license of approval for the business registration is not necessary in the majority of cases.