gUG formation in Germany – setting up a German non profit Entrepreneurial company

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gUG formation in Germany – setting up a German non profit Entrepreneurial company

Are you interested in forming a company whilst at the same time taking action for a charitable purpose? Is the requirement to have seven founders discouraging you from forming a Verein (association)?

As a law firm with years od experience in formation and supported clients, we are familiar with the requirements and special features of the gemeinnützige UG (non-profit entrepreneurial company), and can set up a company. Fast, legally secure and at a fixed price. The non-profit company articles of association are drawn up by a lawyer, individually tailored to your needs

Our website provides comprehensive answers to questions such as:

  • “What is a gUG?”
  • “How much does it cost to form a gUG?”
  • “What’s the difference between this and a gemeinnütziger Verein (non-profit association)?”

We set up your gUG. You focus on business

gUG formation

Contents

Andre Kraus, lawyer and founder of the  KRAUS GHENDLER RUVINSKIJ law firm, is your contact in matters of company formation, trade mark law, reputation protection and corporate law.

Online gUG formation or in-person appointment

You can form a company directly online, book a free initial consultation online or send us a message

Free initial consultation

You will receive a comprehensive initial consultation for the formation of your gUG free of charge. During this meeting, we will clarify any open questions you may have and advise you on the most important basic issues in company formation, such as the right legal form or the costs and procedure involved in forming a company.

Forming your gUG

We start by forming your company. We will support you, from providing legal advice on forming a company, drafting tailored articles of association, arranging a notary appointment and entering your company in the commercial register, to registering a trademark, drawing up your application for tax and business registration, and handling your bookkeeping.

Overview of gUG formation in Germany

The gemeinnützige Unternehmergesellschaft (haftungsbeschränkt) – non-profit entrepreneurial company (limited liability) – is a sub-form of the UG (entrepreneurial company) created in 2013. It offers enormous tax advantages to companies with a non-profit, charitable or ecclesiastical corporate purpose. For example, gUGs are not subject to corporation tax or trade tax. The activity of a non-profit may be concentrated in a wide variety of areas, such as:

  • the welfare of young people and the elderly,
  • environmental protection and animal welfare, and
  • the protection of consumers and monuments.

Founders often make use of the gUG, because it brings with it the following advantages:

  • The option of formation as one-person UG.
  • Effective corporate management by managing directors.
  • Release from private liability for shareholders.
  • Formation with only €1 seed capital.

The gUG is the optimal legal form for founders who want to start their business at low cost and operate on a non-profit basis, while at the same time limiting liability.

We form your gUG for you, leaving you free to focus on your business.

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gUG formation: Our packages

Übersicht der Pakete

gUGRechtssicher

€689,–zzgl. € 130,91 USt.

  • Für Gründer die eine Gründung mit umfassender anwaltlicher Beratung und individueller Vertragserstellung wünschen.

  • Mehr Informationen
  • Anwaltliche Rechtsberatung
    • Erstberatung 30 Min.
    • Gründungsberatung als Video- oder Telefoncall 60 Min.
    • --
  • Begleitung und Organisation
    • Individuelle Video- oder Telefonberatung mit Rechtsanwalt
    • Notartermin zur Beurkundung
    • Kontoeröffnung
    • Einlageneinzahlung
    • Handelsregister
    • Finanzamtsverfahren Gemeinnützigkeit
    • IHK Firmenprüfung
    • --
    • --
  • Umfangreiches Vertragspaket
    • Individueller Gesellschaftsvertrag / Satzung
    • Geschäftsführer Einstellungsvertrag
    • Mustervertragspaket
    • Muster-Eröffnungsbilanz
    • --
    • --
    • --
JETZT ONLINE GRÜNDEN!
oder online Erstberatung reservieren

gUG Plus

€939,–zzgl. € 178,41 USt.

  • Für Gründer, die den gesamten Prozess an uns abgeben wollen. Wir kümmern uns um alles. Beratung zu steuerlichen und enthaftenden Gemeinnützigkeitsprivilegen sowie alle Anmeldungen inklusive.

  • Mehr Informationen
  • Anwaltliche Rechtsberatung
    • Erstberatung 30 Min.
    • Gründungsberatung als Video oder Telefoncall 60 Min.
    • Abschlussberatung "Steuern & Assets" als Video oder Telefoncall 60 Min.
  • Begleitung und Organisation
    • Individuelle Video- oder Telefonberatung mit Rechtsanwalt
    • Notartermin zur Beurkundung
    • Kontoeröffnung
    • Einlageneinzahlung
    • Handelsregister
    • Finanzamtsverfahren Gemeinnützigkeit
    • IHK Firmenprüfung
    • Erstellung Gewerbeanmeldung
    • Elektronische Durchführung Steuerliche Anmeldung
    • Elektronische Durchführung Umsatzsteuer-ID Anmeldung
    • Elektronische Durchführung Eröffnungsbilanzeinreichung
  • Umfangreiches Vertragspaket
    • Individueller Gesellschaftsvertrag / Satzung
    • Geschäftsführer Einstellungsvertrag
    • Mustervertragspaket PLUS
    • Eröffnungsbilanz
    • Gewerbeanmeldung
    • Steueranmeldung
    • USt.-ID Anmeldung
JETZT ONLINE GRÜNDEN!
oder online Erstberatung reservieren

Hier finden Sie eine detailierte Auflistung.
Rückruf anfordern oder direkt anrufen: 0221 – 6777 00 55.

What is a gemeinnützige Unternehmergesellschaft (gUG)?

The gemeinnützige UG (haftungsbeschränkt) was created in 2013. It is derived from the UG, which was introduced by a special regulation in 2008. The aim was to create a legal form that could replace the English limited company. This was in response to the demand from German entrepreneurs for a legal form with limited liability and lower requirements for the initial capital contribution than the €12,500 or €25,000 usual for a GmbH. A legal reform in 2013 created the gemeinnützige GmbH (non-profit limited company), which has the same legal status as the gemeinnützige UG.

Definition of the non-profit UG

A gemeinnützige UG is a limited liability corporation that is formed to pursue a non-profit purpose. Due to the increasing popularity of social entrepreneurship, the gUG (haftungsbeschränkt) plays an important role in Germany. More than 2.3 million people are now employed in the non-profit sector. A non-profit is defined above all by its charitable purpose, which must be documented and anchored in its statute.

As a legal form, it combines the advantages of a commercial organisation with the advantages of preferential treatment as a non-profit-making organisation, as in the law governing the Verein (association). The gUG benefits from tax breaks, does not have to pay trade and corporation tax, and has priority access to public resources.

Liability of the gUG (haftungsbeschränkt)

Since the gUG (haftungsbeschränkt) is a corporation, the liability arising from operating debts is limited to the company’s business assets. As founder or beneficiary of a gUG, you are not liable with your private assets.

Exceptions to the limitation of liability

In certain scenarios, the limitation of liability of the gUG can be lifted and transferred to individual persons:

Personal guarantees: If one of the shareholders is a guarantor for loans or other liabilities of the gUG, they will be liable with their private assets in the event of payment.

Culpable conduct by the managing director: The managing director may be held privately liable if they have committed a criminal offence in their role as managing director.

Managing director liability: A disregard of the other duties of a managing director may also lead to the managing director being privately liable.

PartG

Formation with €1 initial contribution

Unlike a gemeinnützige GmbH, the gUG can be formed with an initial contribution of €1. The value has more of a symbolic role for freedom regarding share capital, because practically no company can be formed with €1. Therefore, a higher initial contribution is needed. However, this can be chosen freely and is therefore significantly below the €12,500 or € 25,000 required in order to form a gGmbH.

The gUG (haftungsbeschränkt) has its own legal personhood

As a corporation, the gUG has its own legal personhood. It can act independently as a contractual partner, or be sued in court (Sections 13, 5a GmbHG (German Limited Liability Companies Act)). If, for example, employees are hired or company premises are rented, the contractual partner is not the managing director or the beneficiary, but the gUG itself.

Option of formation as a single person

A gUG may also be formed by an individual person. The gUG is particularly suitable for this purpose, because of the low share requirements for share capital.

Company name of your choice

Since the gUG is a corporation, it can choose its own company name. The only requirements are that it must not be misleading or already in use (Section 30(1) HGB (German Commercial Code)), and must be distinctive (Section 18(1) HGB). In addition, the corresponding abbreviation “gUG (haftungsbeschränkt)” or “gemeinnützige Unternehmergesellschaft (haftungsbeschränkt)” must be added.

Appointing the managing director

The managing director of the UG does not have to come from the circle of shareholders. It is therefore possible to appoint an external managing director.

Aims of gUG formation

Aims of gUG-formation are:

  1. Tax savings
  2. Combining the non-profit status and the advantages of a UG
  3. Legally secure formation
  4. Minimising formal overheads

  • 1. Objective: Tax savings

    As a non-profit enterprise, the gUG is not required to pay trade or corporation tax. The resulting tax savings can be used entirely for reinvestment. In addition, no VAT has to be paid if it is incurred in the pursuit of the charitable purpose. A reduced tax rate of 7% can be deducted for business-related expenses or income. As a company entitled to make donations, the gUG is not subject to inheritance or gift tax. Finally, no real estate tax is payable on real estate used for the non-profit purpose.

  • 2. Objective: Combining the non-profit status and the advantages of a UG

    The formation of a gUG also serves to combine the advantages of an entrepreneurial company with those of the non-profit status. This limits private liability, while making sure you benefit from tax advantages. In addition, the gUG has priority access to public resources and benefits from the commercial structure compared to a Verein, while at the same time being tax-free. Non-profit founders appreciate the fast decision-making chains that make this legal form more agile than the Verein.

    2. Objective: Combining the non-profit status and the advantages of a UG

  • 3. Objective: Legally secure formation

    By forming a company with an experienced law firm in corporate law, you can establish legal certainty. We take care of the entire process with a legal guarantee: From drafting the articles of association to entering your company in the commercial register. Particular caution is required with the gUG, as revocation of the non-profit purpose can result in high tax back payments. We therefore focus on the legally secure presentation of the non-profit purpose in the articles of association.

  • 4. Objective: Minimising formal overheads

    Forming your gUG makes operating your business easier. We take care of all the formalities so that you can concentrate on starting your business. We only require your input where strictly necessary

    4. Objective: Minimising formal overheads

Advantages and disadvantages of forming a gUG

The gUG as a legal form offers founders many advantages. First and foremost is the release from liability with their private assets for a low share capital amount. This enables you to do business at a reasonable cost and with your private assets protected. Of course there are also some disadvantages; for example, salaries must not be too high. Please see below for an overview of the advantages and disadvantages of a gUG.

Advantages of forming a gUG

  • EXCLUSION OF YOUR PERSONAL LIABILITY

    As with a conventional UG or GmbH, the liability of the gUG is limited to its business assets. Neither shareholders nor managing directors are liable for business debts with their private assets (Sections 13, 5a GmbHG).

  • INEXPENSIVE FORMATION – FROM €1 SHARE CAPITAL

    A gUG can be formed with as little as €1 share capital, and is therefore considerably cheaper than forming a gGmbH, which requires €12,500 or €25,000 are required. Preparing documents and notarial certification are also simpler and therefore cheaper with the UG.

  • POSITIVE IMAGE THROUGH CHARITABLE PURPOSE

    The formation of the gUG creates a positive image due to its non-profit status. Participation in a non-profit enterprise can be used for marketing purposes, both for the company itself and for participating shareholders, who can also be legal persons.

  • NUMEROUS TAX ADVANTAGES AND TAX EXEMPTIONS

    The gUG enjoys numerous tax advantages and exemptions. It must pursue a non-profit purpose. It is thus exempt from the obligation to pay trade tax and corporation tax. The savings can be fully reinvested. Furthermore, no VAT has to be paid on sales from the charitable area. Only reduced VAT need be paid on other sales. A precise delimitation is necessary for this. Further tax advantages such as exemption from gift, inheritance and real estate tax are also available.

  • OPTION OF CONVERSION TO A GGMBH

    As soon as the gUG’s share capital has increased to €12,500 or €25,000, the gUG can be converted into a gGmbH. It is up to you whether to actually convert your gUG into a gGmbH (Section 5a(1) GmbHG).

  • CHEAPER USE OF PUBLIC RESOURCES

    As a non-profit gUG, you can take advantage of public resources at reduced prices. You may also be able to claim subsidies. For example, bureaucratic hurdles are reduced or, under certain circumstances, personnel are given preferential treatment

  • OPTION OF MANAGEMENT BY AN EXTERNAL MANAGING DIRECTOR

    The gUG may appoint a managing director who is not a shareholder. Appointing a third-party manager may limit or exclude your personal liability if you are a shareholder in the gUG and have previously managed the business.

  • SIMPLE CHANGE OF SHAREHOLDERS

    A change of shareholders in a gUG can be easily carried out. If the articles of association are designed to facilitate this, shareholders can sell their shares to interested parties

  • BENEFICIAL ACCEPTANCE OF DONATIONS

    The gUG is entitled to accept donations from other companies and organisations. It can issue a tax-effective donation receipt to the donor, allowing consumers, entrepreneurs and other market participants to reduce their own tax burden. It therefore offers good value for money.

  • COMMERCIAL ORGANISATION FOR ASSOCIATIONS AND FORMATIONS

    Forming a gUG enables you to tackle a charitable purpose within the framework of an association or foundation with a commercial organisational structure. The classic Verein form is often criticised as outdated. The gUG, on the other hand, is a modern variant for non-profit organisations, as it enables quick decision-making chains.

  • FORMATION BY ONLY ONE PERSON

    A gUG can be formed entirely by a single founder. They are then the sole shareholder of the company and at the same time the managing director.

Disadvantages of forming a gUG

  • FORMALITIES INVOLVED IN FORMING AND ADMINISTERING A gUG

    Forming a gUG involves more formal effort than, for example, forming an association.

    Alternative:  In theory, you could also pursue a non-profit purpose by forming a Verein. The bureaucratic effort involved in forming and administering the gUG is higher, but a Verein does not offer the entrepreneurial and tax advantages of the gUG

  • NON-PROFIT PURPOSE IS SUBJECT TO STRICT REQUIREMENTS

    The gUG’s non-profit purpose must be firmly anchored in its statute. In addition, it is subject to constant scrutiny by the tax office, which checks the company’s non-profit status for the current financial year. This status is always obtained retroactively. Salaries for managing directors and employees must be subject to a certain framework. Profit distributions to shareholders may not be made. Otherwise non-profit status will be revoked and the company will become taxable.

    Alternative: Forming an association also serves the public benefit. Since this structure is only intended for non-profit purposes anyway, there is no comparable risk of the non-profit status being revoked.

  • SALARIES MUST NOT BE TOO HIGH

    In order to preserve the overall character of the non-profit status, the salaries of the gUG’s managing directors and employees must not be too high. They must be in proportion to the services rendered. If salaries are too high, non-profit status may be revoked.

    Alternative: Non-profit enterprises may, of course, also operate with a conventional UG. Instead of a beneficiary, there is a shareholder, who may also be a legal person. Only the managing director’s salary must be proportionate, with a framework higher than that of a purely non-profit company. However, tax exemptions do not apply.

  • NO DISTRIBUTION OF PROFITS IS POSSIBLE

    In the case of a non-profit UG, distribution of profits to shareholders is not possible. You would lose your non-profit status and thus all tax advantages, and would henceforth have to act as a conventional UG. The distribution violates the principle of selflessness.

    Alternative: You can make profit distributions with a pure UG. For example, a Verein could be a shareholder of a UG and thus become involved. Other shareholders could be involved with economic self-interest.

  • ONLY LIMITED RESERVES CAN BE FORMED

    The selflessness of the gUG would stand in the way of building up capital. This means that 75% of annual income would always have to be invested in the charitable purpose. Only 25% may be retained to build up share capital. Other reserves may only be formed within the scope of the tasks set out in the statute.

    Alternative: Unconditional build-up of capital is possible with a profit-oriented UG (haftungsbeschränkt).

  • HIGHER ACCOUNTING EXPENSES THAN THE VEREIN

    The commercial organisation requires double-entry bookkeeping and balance sheet preparation. The gUG’s administrative costs are therefore disproportionately higher than those of an association. The latter only has to carry out double-entry once its turnover exceeds €500,000.

    Alternative: If your charitable project is expected to generate smaller revenues and profits, the Verein may be the better option if you want to minimise administrative effort. Alternatively, the GbR is not obliged to do anything more than keep a revenue-surplus account.

  • NOTARIAL CERTIFICATION REQUIRED

    As a corporation, the gUG requires notarisation before it can be entered in the commercial register and open a business account. Therefore, formation is a bit more expensive.

    Alternative: A GbR can also be formed to pursue a non-profit purpose. In this case, however, certification by a notary public is not required. However, there is no release from private liability for the shareholders.

  • WORSE IMAGE THAN THE GGMBH

    The gUG is a relatively new form of corporation and also has much less initial capital. Therefore, the image of the gUG is significantly worse than that of the gGmbH. This can be particularly problematic in commercial transactions, where the GmbH, as the absolutely most prestigious company form, always has priority.

    Alternative: If you want to form a non-profit company with a strong image, it is worth choosing the gGmbH as its legal form.

gUG founding by a lawyer

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Open questions? – Just call us:

0221 – 6777 00 55

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Duration of gUG formation

  • 1 - 2 days

    Formation advice, articles of association

    Legal formation advice and drawing up articles of association

  • 1 - 3 days

    Notarisation appointment

    Arranging a notarisation appointment

    1 - 3 days

  • 1 - 2 days

    Initial contribution

    Opening business account, paying in the initial contribution

  • 5 - 14 days

    Commercial register

    Entry into the commercial register

    5 - 14 days

  • 8 - 21 days

    Total duration

    Total duration- from Legal formation advice to entry into the commercial register

The minimum formation time of a gUG is 8 days from the first telephone call to the entry in the commercial register. On average, the formation of a gUG takes about 21 days – from the initial consultation to the registration of the UG in the commercial register.

Vorbereitung der gUG Gründung

Die Gründung einer Kapitalgesellschaft bedarf einer umfangreichen und präzisen Planung vorab. Schon vor Beginn des Gründungsprozesses sollten Sie sich ausreichend Zeit nehmen, um alles zu planen. Eine nachträgliche Änderung der Gesellschaftssatzung kann teuer und umständlich werden. Schlimmer ist es sogar, wenn nur ein Mustervertrag benutzt wird, und im Nachhinein Schwierigkeiten auftreten.

Daher sollten Sie in der Vorbereitung 4 wichtige Schritte beachten.

  • Schritt 1 - Erstellung des Businessplans

    Erstellen Sie zunächst einen Businessplan, um Ihr Vorhaben realistisch und umfänglich einzuschätzen.

  • Schritt 2 - Finanzierung und Marketing

    Stellen Sie sicher, dass Ihre Finanzierung und der Vertrieb stehen. Beginnen sie frühestmöglich mit der Akquise für Ihr Produkt / Ihre Dienstleistung.

    Schritt 2 - Finanzierung und Marketing

  • Schritt 3 - Beachtung der rechtlichen Grundfragen

    Machen Sie sich Gedanken zu den rechtlichen Grundfragen Ihrer Gründung.

    Wichtige Aspekte sind:

    • Gemeinnützigkeit
    • Rechtsform
    • Vertretung und Geschäftsführung
    • Gesellschafter
    • Begünstigte
    • Stammkapital
    • Nachfolge
    • Erbschaft

  • Schritt 4 - Firmennamen aussuchen

    Schließlich sollten Sie sich entscheiden, wie Ihre gUG heißen soll. Er  darf nicht irreführend oder bereits vergeben sein (§ 30 Abs. 1 HGB). Zudem muss er Unterscheidungskraft haben (§ 18 Abs. 1 HBG).

    Schritt 4 - Firmennamen aussuchen

Forming a gUG in 11 steps – step by step

Overview: Course of forming a gUG

  1. Free initial consultation
  2. Legal formation advice
  3. Checking the company name
  4. Drawing up the articles of association
  5. Checking non-profit status
  6. Notarisation meeting
  7. Eintragung in das Transparenzregister
  8. Opening the business account, paying in the initial contribution
  9. Entry into the commercial register
  10. Final consultation
  11. Tax and business registration

gUG founding by a lawyer

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Over

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FOUNDING ONLINE NOW
Download Documents
↪ or reserve a free initial consultation.

Open questions? – Just call us:

0221 – 6777 00 55

(Mo. – So. from 9am to 22pm / NATIONWIDE – German landline)

Process of forming a gUG

  • Step 1 – Free initial consultation

    Before you take advantage of one of our start-up packages, you can get informed in our free initial consultation. One of our employees will clarify the most important and fundamental questions about forming a gUG. First of all, we clarify with you whether the gUG is suitable for your business project, and whether the principle of selflessness can be maintained. Following the consultation, you can independently decide on the appropriate legal form for you

  • Step 2 – Legal formation advice

    If it turns out that the gUG is the best choice for your non-profit enterprise, we will be pleased to welcome you as a client of our law firm. An experienced lawyer will personally guide you through the entire formation process. First of all, the legal questions that determine the further course of the process are clarified in detail. Appropriate time should be allocated for the intensive consultation. Good preparation prevents later correction, which is very costly. Your lawyer will take sufficient time to cover all aspects that are legally relevant to and influence your formation. Due to the non-profit nature of the project, we will especially check the selflessness of your project, which is necessary to obtain later tax advantages. The following topics are discussed in the formation consultation:

    • choosing the right legal form,
    • exclusion of your personal liability,
    • the selflessness of the company’s non-profit purpose,
    • beneficiaries,
    • share capital,
    • shareholders,
    • succession,
    • distribution of profits,
    • disposition of company shares, and
    • management

    Step 2 – Legal formation advice

  • Step 3 – Checking the company name

    After the consultation, your company name will be checked. If it complies with the requirements of company law, formation can proceed.

  • Step 4 – Preparing the formation documents

    Based on the findings of the intensive consultation, we prepare all the necessary documents for the formation. Since the gUG’s focus is on selflessness and its non-profit-making purpose, we devote particular attention to presenting this in the articles of association. In order for the status to be maintained in the long term, non-profit status must be enshrined in the statute.

    In addition, we will work out the further details of the articles of association in your interest. To save time, a “standard record” is often used for formation (Annex to Section 2(1a) GmbHG). We adapt this to your personal preferences.

    You decide on the form of the formation

    Depending on your personal preferences, we prepare the necessary formation documents:

    If you would like to introduce certain provisions for internal organisation, we will draw up tailored articles of association for you!

    There are no risks – we adapt your standard record personally.

    The fixed price remains the same – Our law firm offers formation at a fixed price, regardless of the complexity of the formation documents.

    Articles of association: The gUG’s formation costs are tax deductible.

    The formation expenses are only tax-deductible if the company is formed with a tailored statute. If it is formed with a standard record, the formation costs cannot exceed €300 in order to be deductible (para. 5 of the Annex to Section 2(1a)).

    Preparing for a crisis or dispute

    The articles of association for your gUG not only guarantee that your non-profit status is maintained, but also serve as a precaution in the event of a crisis or dispute. If important liability issues or succession are not adequately regulated, the company risks financial difficulties in the event of a crisis. If the relationship between shareholders deteriorates over time, clear distribution and responsibility rules can ensure that the stability of the gUG is maintained.

    Further formation documents

    In addition to the articles of association, further formation documents must be drawn up for your gUG. These include:

    All relevant shareholder and company resolutions, and resolutions of the shareholder meeting.

    List of shareholders and entry in the commercial register.

    Step 4 – Preparing the formation documents

  • Step 5 – Checking non-profit status

    We will send the prepared formation documents to the relevant tax office to check the non-profit status of your company. If we receive positive confirmation, formation will proceed, otherwise the articles of association will be amended according to the tax office’s suggestions.

  • Step 6 – Notarisation

    Once all the formation documents have been drawn up, we will arrange a notarial recording appointment. The appointment will take place in your area in accordance with your schedule. We will forward the necessary documents.

    Step 6 – Notarisation

  • Step 7 – Entry in the transparency register

    As of 2019, companies must be entered in the federal transparency register under the Geldwäschegesetz (GwG; German Money Laundering Act) of 2017. This should make it possible to recognise the persons economically responsible for a company at a glance. The first and last names, dates of birth, places of residence and the nature and extent of the economic interest of the beneficial owners must be entered. Registration may be waived if this information can already be retrieved from the commercial register or another public register.

    If necessary, your company will be entered in the transparency register after notarisation.

  • Step 8 – Opening the business account, paying in share capital

    After notarisation, we open a business account for your gUG at a suitable bank of your choice. You pay in the share capital. We prepare the bank appointment for you and provide a power of attorney and a checklist.

    Step 8 – Opening the business account, paying in share capital

  • Step 9 – Entering the gUG in the commercial register

    Your gUG will then be entered in the commercial register (Section 7 GmbHG).

  • Step 10 – Final consultation

    Experience has shown that many legal questions that were not previously apparent arise during the formation of a company. Therefore, we offer our clients a final consultation. This frequently involves discussing:

    • tax obligations,
    • commercial registration,
    • legal requirements,
    • business letters,
    • legally admissible advertising,
    • copyright,
    • dubious bills and fraud prevention, and
    • necessary insurance.

    Step 10 – Final consultation

  • Step 11 – Tax and business registration

    Based on the final consultation, we take care of tax and business registration for your gUG with the relevant authorities.

Transparency register

As of 2019, companies must be entered in the federal transparency register under the Geldwäschegesetz (GwG; German Money Laundering Act) of 2017. This should make it possible to recognise the persons economically responsible for a company at a glance. The first and last names, dates of birth, places of residence and the nature and extent of the economic interest of the beneficial owners must be entered. Registration may be waived if this information can already be retrieved from the commercial register or another public register

If necessary, your company will be entered in the transparency register after notarisation.

gUG founding by a lawyer

✔ CHEAP✔ FAST✔ LEGALLY SECURE

Over

20000

checked cases

FOUNDING ONLINE NOW
Download Documents
↪ or reserve a free initial consultation.

Open questions? – Just call us:

0221 – 6777 00 55

(Mo. – So. from 9am to 22pm / NATIONWIDE – German landline)

Taxes of a gUG

No corporation tax for the gUG

If its non-profit status is recognised by the tax office, the company does not have to pay corporation tax. This results in a saving of 15% on operating profit, which in turn can be invested in the charitable area. However, it must be noted that non-profit status is recognised independently for each year by the tax office. If the status expires, corporation tax must be paid. For this reason, tax consultancy support is particularly important for the gUG.

No trade tax

The gUG is also exempt from paying trade tax. Although it must register a business with the relevant office, it does not have to pay taxes if the non-profit status is maintained.

Solidarity surcharge

The gUG also does not have to pay the solidarity surcharge.

Capital gains tax

It is not exempt from capital gains tax. However, the gUG may not pay out any profits to its shareholders, as this would threaten its non-profit status. Otherwise, capital gains tax of 25% would have to be paid.

Salaries may only be paid within reasonable limits

In order to maintain non-profit status, the appropriateness of salaries paid is of particular importance to the gUG. The amount of the salary must always be in proportion to the services rendered. Otherwise, the tax office could interpret this as a hidden profit distribution, which would lead to the loss of non-profit status and the associated tax exemptions.

Exemption from other taxes

The gUG, just like the gGmbH, is exempt from property tax on real estate used for the company’s charitable purpose. Gift and inheritance tax are also not applicable.

Costs incurred when a gUG is formed

Übersicht der Pakete

gUGRechtssicher

€689,–zzgl. € 130,91 USt.

  • Für Gründer die eine Gründung mit umfassender anwaltlicher Beratung und individueller Vertragserstellung wünschen.

  • Mehr Informationen
  • Anwaltliche Rechtsberatung
    • Erstberatung 30 Min.
    • Gründungsberatung als Video- oder Telefoncall 60 Min.
    • --
  • Begleitung und Organisation
    • Individuelle Video- oder Telefonberatung mit Rechtsanwalt
    • Notartermin zur Beurkundung
    • Kontoeröffnung
    • Einlageneinzahlung
    • Handelsregister
    • Finanzamtsverfahren Gemeinnützigkeit
    • IHK Firmenprüfung
    • --
    • --
  • Umfangreiches Vertragspaket
    • Individueller Gesellschaftsvertrag / Satzung
    • Geschäftsführer Einstellungsvertrag
    • Mustervertragspaket
    • Muster-Eröffnungsbilanz
    • --
    • --
    • --
JETZT ONLINE GRÜNDEN!
oder online Erstberatung reservieren

gUG Plus

€939,–zzgl. € 178,41 USt.

  • Für Gründer, die den gesamten Prozess an uns abgeben wollen. Wir kümmern uns um alles. Beratung zu steuerlichen und enthaftenden Gemeinnützigkeitsprivilegen sowie alle Anmeldungen inklusive.

  • Mehr Informationen
  • Anwaltliche Rechtsberatung
    • Erstberatung 30 Min.
    • Gründungsberatung als Video oder Telefoncall 60 Min.
    • Abschlussberatung "Steuern & Assets" als Video oder Telefoncall 60 Min.
  • Begleitung und Organisation
    • Individuelle Video- oder Telefonberatung mit Rechtsanwalt
    • Notartermin zur Beurkundung
    • Kontoeröffnung
    • Einlageneinzahlung
    • Handelsregister
    • Finanzamtsverfahren Gemeinnützigkeit
    • IHK Firmenprüfung
    • Erstellung Gewerbeanmeldung
    • Elektronische Durchführung Steuerliche Anmeldung
    • Elektronische Durchführung Umsatzsteuer-ID Anmeldung
    • Elektronische Durchführung Eröffnungsbilanzeinreichung
  • Umfangreiches Vertragspaket
    • Individueller Gesellschaftsvertrag / Satzung
    • Geschäftsführer Einstellungsvertrag
    • Mustervertragspaket PLUS
    • Eröffnungsbilanz
    • Gewerbeanmeldung
    • Steueranmeldung
    • USt.-ID Anmeldung
JETZT ONLINE GRÜNDEN!
oder online Erstberatung reservieren

Hier finden Sie eine detailierte Auflistung.
Rückruf anfordern oder direkt anrufen: 0221 – 6777 00 55.

Costs overview

The following costs are incurred when a gUG is formed.:

DescriptionCosts
Formation costsAdvice on legal form, advice on forming a company and advice on financial statements, drawing up of the articles of association and forming documents, organisation of the formation, representation during the entire formation process, company audit by the IHK, managing director contract, opening balance sheet and preparation of the trade and tax registration, VAT ID application and contract documents.Fixed price: 689,– € (“Rechtssicher”) or 939,– € (“Rechtssicher PLUS”)
Notarisation costsNotarisation of the articles of association and other forming documents. By providing prior advice on formation and drawing up the articles of association and the formation documents for a fixed price, we may save you the significantly higher costs of a contract drawn up by the lawyer notary on the basis of the RVG (German Law on Lawyer’s Fees), or when invoicing on an hourly basis.Between 280,- (standard record) and 835,- € (individual statutes) on average
IHK contribution.From €115.00
Entry into the commercial registerOften between €150.00 and €240.00
Tax registrationFree of charge

Formation of a gUG at a fixed price

Our legal fee is a one-time fixed amount: you will not incur any further costs. In particular you will have to pay

  • no higher lawyer’s/notary’s fee according to RVG for the formation consultation as well as the final consultation
  • no higher lawyer’s/notary’s fee according to RVG for the preparation of your individual articles of association
  • no higher lawyer’s/notary’s fee according to RVG for the organization of your incorporation/your representation during the incorporation process
  • no higher notarial fee according to GNotKG for the preparation of the formation documents (shareholders’ resolutions, etc.)

These costs are usually not fixed from the beginning and can get very out of hand. With us it remains with a fixed price, which is independent of the complexity or lengthiness of your case (price transparency).

Discount for serial founders or Holdings

Often several companies are founded. This happens especially in the case of serial founders or when several companies are established within the framework of a holding model. In this case, we grant a discount of 20% on our respective fixed price from the second company onwards.

Questions and answers regarding the formation of a gUG

When forming a gUG, clients often have questions such as::

  • “When is a gUG  non-profit?”
  • “How is the profit of a gUG distributed?” or
  • “What is the difference between an UG  and a gUG?”

Below you will find the most frequently asked questions and our answers regarding the formation of a gUG.

The difference lies in the orientation of the purpose of the company. While the classic UG (haftungsbeschränkt) aims to maximise profits and skim off profits for personal enrichment, the gUG pursues a non-profit purpose. This must be firmly anchored in the articles of association.

This results in the following legal differences:

  • The gUG may not pay out any profits to its shareholders.
  • The salaries of the employees and the managing director must be in proportion to the services rendered, otherwise a hidden profit distribution is assumed.
  • The company’s non-profit purpose must be firmly anchored in the articles of association.
  • Due to its non-profit status, the gUG enjoys numerous tax exemptions.
  • The gUG must designate a beneficiary who will receive the capital in the event of the company’s dissolution.
  • The gUG must reinvest 75% of its income in the charitable purpose. Only 25% may be used to build up share capital.

As a commercial company to be registered, the gUG has a free choice of company name. It can therefore be in line with your marketing strategy or charitable values. Nevertheless, the requirements of commercial law must be met. The name:

  • cannot be misleading,
  • cannot be already in use (Section 30(1) HGB), and
  • must be distinctive (Section 18(1) HGB).

In addition, the official abbreviation must be appended in business transactions. These are “gUG (haftungsbeschränkt)” or “gemeinnützige Unternehmergesellschaft (haftungsbeschränkt)”.

In order for your UG (haftungsbeschränkt) to be classified as non-profit, the non-profit purpose must first be anchored in the statute. In doing so, the requirements of the law of public utility according to Section 52 AO must be taken into account:

The business purpose of the company must be non-profit, charitable or ecclesiastical.

The business purpose must be pursued selflessly, directly and exclusively. All activities must serve to fulfil the purpose of the company. An example of failure to do this would be the payment of excessive wages.

Pursuing the business purpose must benefit the public good. It must not benefit only a limited group of people.

The articles of association must specify a beneficiary who will benefit from the share capital in the event of the company being dissolved.

In order to maintain the gUG’s non-profit status, the profits may only be used to pursue the non-profit purpose. The principles of directness and selflessness apply here. In this context, direct means that the profits may not be saved up, but must be used directly for the charitable purpose. Selfless means that the salaries for managing directors and employees must always be in a comprehensible relationship to the work performed.

Reserves can be formed under certain conditions

It is only possible for gemeinnützige UGs to form reserves under certain conditions. These must be legally enshrined in the company’s statute. Unlike the gGmbH, the gUG can generally save 25% of operating profits in order to build up share capital. Justifications may include the need to save for a larger investment. However, this investment must again serve the non-profit purpose.

Caution against hidden profit distributions

Hidden profit distributions violate the principle of selflessness and lead to a UG being deprived of its non-profit status, which causes it to lose tax exemptions. If, for example, salaries are paid that are not in proportion to the services rendered, a hidden profit distribution may be assumed.

The gemeinnützige UG benefits primarily from tax breaks. For example, no VAT is payable for income that can be assigned to the non-profit business purpose in the charitable area. However, no input tax can be deducted for expenditure in this area. It must be deducted as acquisition costs.

The gUG continues to be entitled to deduct input tax when operating in the business area. There are three categories:

  • Asset management
  • Special-purpose operations
  • Other business operations

Income from special-purpose operations and asset management is only subject to the reduced tax rate of 7%.

19% VAT is normally payable on other business operations.

Input tax can therefore be deducted in those areas where VAT is incurred. These are all of the three sub-sectors of the business area mentioned above. Only for the charitable area can no input tax be deducted. It can be difficult to distinguish between special-purpose operations and the charitable area, and this should be done when drawing up the articles of association.

Social entrepreneurship is also becoming increasingly important in Germany. Until non-profit corporations were introduced, the eingetragener Verein was the common legal form for a non-profit organisation.

What may be an enrichment for the classic association is a burden for economically oriented non-profit organisations: The long decision-making chains and strong co-determination rights for association members. Only by convening a general meeting can important decisions be made, which makes the association more sluggish than the gUG.

The gUG combines the advantageous components of commercial organisation with the useful benefits of the non-profit status. Thanks to the position of the managing director, decisions can be made more quickly, but the shareholder meeting can still exercise control rights over the parties involved. At the same time, the enormous tax breaks benefit the charitable purpose.

The gUG is therefore worthwhile if: You want to set up a non-profit organisation and prefer short decision-making chains and a commercial organisation, and want to take advantage of tax benefits.

Since the introduction of the regulations on non-profit corporations, the need for the Verein has been drastically reduced. Due to its commercial organisation and full-time management, the gemeinnützige UG has become attractive to many organisations.

Converting an association into a gemeinnützige UG is somewhat complicated but still possible. Especially when associations accumulate a larger amount of capital or want to operate commercially, the conversion tends to be worthwhile.

No complete rebuilding necessary

There is no need to completely re-form and abandon the structures of the Verein. Existing contracts can usually be taken over. However, a general meeting resolution for legal examination and conversion is required. If the latter has been drawn up in accordance with the provisions of the law on associations, the articles of association must be drafted for the gUG. It is important here that the charitable purpose is anchored. In addition, a beneficiary organisation must be designated to which the capital will be transferred on dissolution. If the articles of association are notarised, the general meeting of shareholders can be convened to appoint the managing director. The process is then completed.

The business assets of the gUG shall be liable for any debts which arise in the course of pursuing the non-profit purpose. However, under certain circumstances, the managing director of a gUG (haftungsbeschränkt) may be held liable. For this, they must be responsible for personal misconduct.

Such conduct often takes place in the following areas:

  • tax law and social security,
  • in connection with insolvencies, and
  • in the event of damage being caused in the context of a breach of their duty of care.

It should therefore be noted that any misconduct in breach of the duties of a managing director will result in the managing director being liable.

Your formation team

Andre Kraus 
Specialist lawyer for insolvency law

Ahaliya Kapilan
Lawyer

Oksana Enns
Business law graduate

Sara Garcia Corraliza
Lawyer

and a team
of legal advisors, business law graduates and other lawyers

Over

8000

Mandates

Over

20000

free document reviews

Over

22000

free initial consultations

Over

2000

answered forum questions

Principles

  • Free initial legal consultation

    Free initial legal consultation on your foundation project.

  • Quick and easy

    We take care of the formalities of your formation – You concentrate solely on your business. There is no waiting period or long processing time.

  • Legal security

    Your incorporation directly from the lawyer. We fulfill the reservation of legal advice by a lawyer (§ 2 II RDG) and assume the full legal guarantee.

  • Price transparency

    We accompany you at a fixed price – without complex fees or indirectly allocated costs from intermediary portals.

  • Specialization

    Due to our concentration on certain core areas we offer you a particularly high level of expertise at a a relatively low fixed price.

  • Long-term perspective

    The consulting for your formation is our investment in a long-term cooperation in the fields of corporate and consumer law.

Start your company now!

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