Living in Bogenhausen: Upscale villa district with elegant flair

With its 86,000 inhabitants, Bogenhausen is one of Munich’s largest districts and at the same time one of the least densely populated districts of the Bavarian capital. Along with Grünwald and Tegernsee, this upscale neighborhood is one of Munich’s most attractive places to live. The social structure is balanced, the crime rate low and the quality of life high. There is hardly any other part of the city where you can find as many villas as here. And if you need a break from the bustling city life, you can relax on the banks of the Isar – a magnificent view, typical Bavarian coffee and a fabulous sunset included.

Welcome to Munich: The capital of Bavaria

A high quality of life, low unemployment rate, booming economy and breathtaking nature make up the charm of Munich. Thus, not only couples, families and students can be enthusiastic about the romantic capital of Bavaria, but also entrepreneurs and investors. Munich is one of the most important business locations in Germany, along with Berlin and Hamburg.

Bogenhausen: Map & Location

The famous Bogenhausen district is located in the north-east of Munich and is thus somewhat removed from the hustle and bustle of the turbulent city centre. However, the popular districts of Lehel, Neuhausen-Nymphenburg and the historic old town are not far away by car.

Bogenhausen is a district and a borough at the same time. The district Bogenhausen can be subdivided into:

• Bogenhausen
• Oberfoehring
• Daglfing
• Denning
• Englschalking
• Johanneskirchen
• Zamdorf
• Steinhausen

Here map and location of Bogenhausen:

Sights of Bogenhausen: From the banks of the Isar River to Villa Struck

Bogenhausen is not only one of the most popular districts in Munich, it is also one of the places with the highest quality of life. No wonder: While the most expensive streets in Munich with their breathtaking architecture invite you to take a leisurely stroll, the local coffee houses and typical Bavarian restaurants delight with their local delicacies. Several monuments and sights can also be found in Bogenhausen. And if you need a change of scenery, you can quickly get to other parts of the city by car or public transport.

Here are the most famous sights in Bogenhausen:

• Angel of Peace
• Villa Struck
• Monacensia in the Hildebrand House
• Bogenhausen Cemetery
• River bank of the Isar

Especially the sunsets at the riverside belong to the most beautiful sunsets in Germany:

Celebrity neighbours: Jerome Boateng, Boris Becker, Manuel Neuer & Co.

If you live in Bogenhausen, you can count on celebrity neighbours. Whether it’s film, television, music or sport – it’s not just entrepreneurs and investors who have discovered this district of Munich for themselves, but also some of the most famous faces in Germany. For example, professional athletes Jerome Boateng and Boris Becker are among Bogenhausen’s best-known residents. Goalkeeper Manuel Neuer is also rumored to be moving here soon. The history of the villa district shows: Many a celebrity has also been drawn here in recent decades. Author Eric Kästner, actor Walter Sedlmayr and director Rainer Werner Fassbinder have not only lived here in the meantime, but are now buried here in Munich’s most famous celebrity cemetery.

Here are the famous residents of Bogenhausen:

• Jerome Boateng
• Boris Becker
• Manuel Neuer
• Eric Kästner
• Walter Sedlmayr
• Rainer Werner Fassbinder

Sightseeing: A tour through Bogenhausen

Living in the middle of the city in a stately villa with an adjacent park and its own beach? That’s also possible in Munich. And you don’t even have to be of blue blood to do it, although it helps immensely if you belong to the moneyed aristocracy. The highest density of villas in the city is to be found in the Bogenhausen district. This is the district north of Prinzregentenstrasse, which for decades has been the favorite neighborhood of celebrities – along with Grünwald – and has correspondingly high real estate prices. This is where society meets at the “Käfer” delicatessen counter or at the noble restaurant Aquarello in Mühlbauer Straße, goes out to the Prinzregenten Theater in the evening or visits one of the city’s celebrities during a walk through the old cemetery of St. Georg: Fassbinder, Eichinger, Sedlmayr and Helmut Fischer are buried here.

Alt-Bogenhausen: Historic apartment buildings & baroque architecture

Alt-Bogenhausen not only inspires with its many monuments, churches and historical sights. The most beautiful old buildings and monuments of the city are also at home here. For example, the magnificent old mansions in the classicist and baroque style of past centuries can be found along Maria-Theresia-Straße and Ismaninger Straße. They are among the most sought-after properties in the city.

The top locations in Alt-Bogenhausen: Maria-Theresia-Straße & Ismaninger Straße

See more on Streetview:

Mauerkircherstraße: Exclusive villas experience price increase

Mauerkircherstraße is located north of Ismanigerstraße. While in Alt-Bogenhausen you will find mainly apartment buildings, luxurious lofts and renovated apartments in old buildings, this corner of Bogenhausen delights with its many extravagant villas. The riverbank is only a few minutes away from here and so local residents appreciate the many Isar green spaces, beach access and the tranquility of the district. As a result, there has hardly been such a high price increase for real estate in any other street. You can expect prices per square metre of up to €13,700.

Apartment & house: 13,700 euros per square meter

Take a look at the most beautiful villas in Bogenhausen:

Real estate & prices per square metre in Bogenhausen

The Bogenhausen villa district has not only grown in size in recent years, but has also always enjoyed a large influx. The high demand is also reflected in the prices per square metre. How much does a newly built apartment in the east of the district cost? And how much rent can you ask for when you finally want to buy an apartment building, right on the banks of the Isar? You can find out this and more here.

Buy property: Altbogenhausen, Daglfing. Johanneskirchen & Co.

Whether it’s a new build or an older property, one thing is certain: only top earners can afford their own home in Bogenhausen. Prices for apartment buildings, condominiums and villas have risen significantly in recent years. In fact, they have doubled! For example, you now pay 12,300 euros per square metre for new apartments in Altbogenhausen, and almost 13,000 euros per square metre in the vicinity of Herzogpark. By way of comparison: five years ago, the price per square metre here was only 6,700 euros! Whereas apartments in older buildings used to be worth just under €4,000 per square metre, today you can hardly get an apartment for this price, even on the outskirts of the district, as prices per square metre have also jumped rapidly in the east.

Square meter prices almost double after 5 years!

Here everything at a glance:

• Altbogenhausen (new building): 13,000 euros per square metre
• Daglfing (existing): 6,000 euros per square metre
• Johanneskirchen (existing): 5,350 euros per square metre
• Daglfing & Johanneskirchen (new construction): 6,100 to 8,400 euros per square metre

The properties near the river are therefore among the most popular properties in the whole of Munich:

Rent apartment, house & land: Old building & new building

Rents have also risen in the meantime. Especially at Herzogpark, i.e. on the banks of the Isar, you can expect prices of up to €19 per square metre. That is still 5 euros higher than in the east of Bogenhausen. Whereas the western part of the district is attractive because of its proximity to the Isar, the eastern part is impressive because of its modern, newly built apartments, the good connections to the train station and airport, as well as the proximity to schools, theatres, shopping centres and hospitals.

In the west almost 5 euros higher than in the east

Here are the most important figures at a glance:

• New construction in the west: 18-19 euros per square metre
• Old building in the west: 11-12 euros per square metre
• New & old buildings in the east: 14 euros per square metre

Conclusion: Living in Bogenhausen

You would like to live in Munich? Here Bogenhausen delights with its prime location, the many historic mansions of years gone by and its proximity to the lakeside of the Isar. A high quality of life, first-class real estate and the elegant ambience of the district are what make Bogenhausen so charming. The exclusivity of the district is also reflected in the prices per square metre. Although these have risen rapidly in recent years, as an investor and landlord this means that you can look forward to a high return here. If you would like to buy a property in Bogenhausen, we recommend that you contact a competent estate agent. He will not only advise you on the subject of taxes and finances, but will also accompany you through the entire purchase process. An experienced real estate agent not only accompanies you through the entire purchase process, but also advises you on the topics of taxes and real estate, renovation and modernization with craftsmen, architects & Co, as well as real estate valuation and off market.

Munich: Real Estate in Bavaria

Munich is the most populous city in Bavaria and the third largest municipality in Germany. With around 4,800 inhabitants per square kilometre, the Bavarian metropolis is also the most densely populated municipality in Germany. The figures confirm the population growth. More and more people want to live in the Bavarian metropolis. The proximity to the Alps and neighbouring Austria make Munich very attractive.

Real estate in Munich

Munich counts itself as one of the economic metropolises of Germany. It is also famous for its high quality of life and the surrounding nature. Skiing in the Alps or hiking, as well as countless lakes for summer activities are in the immediate vicinity, not to mention the Italian coast in the south.

• Real Estate Munich

Living in Munich: Popular districts & residential areas

In no other German city is housing as expensive as here. Experts agree that a property in Munich in the right neighbourhood is a safe investment. But what does ‘right location’ mean in Munich and what kind of investment should one expect to make in order to buy a decent apartment or a luxurious house in the capital of Bavaria? We answer these questions here! To the overview: Living in Munich

• Bogenhausen
• Glockenbachviertel
• Haidhausen
• Maxvorstadt
• Nymphenburg
• Schwabing
• Lake Starnberg
• Tegernsee
• Grünwald

Sell, buy and live in Munich

More and more people want to live in the Bavarian metropolis. The proximity to the Alps and the neighbouring country Austria make Munich very attractive and also the individual districts have a lot to offer. While Lehel and the old town convince with their historical charm, the residential areas of Bogenhausen and Schwabing inspire with their variety of well-kept green spaces and parks. The vibrant Maxvorstadt and the elegant Nymphenburg are also among the most attractive places to live in Munich. Do you want to sell your apartment, your apartment building or your own property here? With our free guides on selling real estate in Munich, you are well prepared. To the overview: Selling real estate in Munich.

• Neuhausen-Nymphenburg
• Lehel
• Old Town
• Schwabing
• Bogenhausen
• Maxvorstadt

Joint stock company: formation, advantages and disadvantages

In the following, you will find out everything you need to know about setting up an AG. How do you become a shareholder of an AG? What are incomplete and complete companies? What are the advantages? What are the disadvantages? How do I set up a company? What is a company? Many questions – many answers! Plus everything you need to know about taxes and real estate trading.

If you’re considering forming a corporation, the first thing you need to know about is the formation process: Who can incorporate, when, at how many, what exactly… what are the differences and similarities between the various forms of corporate law? It is equally important to know the advantages and disadvantages of an AG: From profit distribution to saving taxes – an overview of the seven most important founding criteria for you.

What are the founding criteria?

1. Number of shareholders
2. Management
3. Foundation
4. Company name
5. Funding
6. Liability
7. Profit distribution

Corporation AG: Management according to HGB

In the entrepreneurial world, there are many different forms of business you can choose from. They are roughly divided into two categories, namely sole proprietorship and companies, which in turn are divided into incomplete companies – these include dormant companies and BGB companies – and complete companies – partnerships, corporations and some more.

The stock corporation – AG for short – is one of the so-called complete companies and, in contrast to incomplete companies, is not subject to the German Civil Code (BGB) but to the German Commercial Code (HGB). As a corporation, the AG has a more complex structure than other forms of corporate law, since – like a limited liability company (GmbH) – it cannot simply be founded informally, but rather certain formal requirements must be met in advance for the company to be founded. This essentially includes the notarial certification of the shareholders’ agreement.

Other typical corporations:

• European Company (Societas Europaea, abbreviated to SE)
• Partnership limited by shares (KGaA)
• Entrepreneurial company / UG (limited liability)
• Limited liability company (GmbH)

Together with the GmbH, the stock corporation is the best-known form of corporation. In Germany, it is primarily chosen as the legal form for listed companies and is considered the “big sister” of the limited liability company – not least because of the higher founding capital.

Legal form variant AG & Co KGaA – KGaA with general partner AG

Sometimes the AG also appears in combination with a partnership limited by shares (KGaA). Family businesses, for example, occasionally organise themselves as Aktiengesellschaft & Compagnie Kommanditgesellschaft auf Aktien – in short: AG & Co KGaA. In this case, they form a stock corporation in the legal sense – however, the general partner as a personally liable partner is not just any natural person, but specifically also a stock corporation. If the general partner is instead embodied by a GmbH, it is referred to as a GmbH & Co KGaA, and in the case of a Societas Europaea, as an SE & Co KGaA.

More about the individual hybrid forms:

• GmbH & Co KGaA – see limited liability company (GmbH)
• SE & Co KGaA – see Societas Europaea (SE)

Companies operating under the legal form variant of AG & Co KGaA have only existed since the end of the 1990s, following the unambiguous declaration of open legal issues by a court ruling of the Federal Court of Justice (BGF). The holding company of the well-known Hornbach Baumarkt AG, Hornbach Immobilien AG and Hornbach Baustoff Union GmbH has opted for the formation of an AG & Co KGaA, as have many other companies from a wide range of sectors: Ticketing & Live Entertainment, Medical and Security Technology, Adhesives, Cleaning Agents and Beauty Care, to name but a few.

Examples of AG & Co KGaA companies:

• CTS EVENTIM AG & Co. KGaA
• Drägerwerk AG & Co. KGaA
• Fresenius Medical Care AG & Co. KGaA
• Henkel AG & Co. KGaA
• HORNBACH HOLDING AG & Co. KGaA
• ProCredit Holding AG & Co. KGaA

CEWE Stiftung & Co. KGaA is a special case: In this company, the general partner is embodied by a foundation. In principle, the partnership limited by shares is possible in all conceivable combinations, as GUB Investment Trust KGaA points out as an example.

Continue reading here on the topic of setting up a family foundation:

• Establish a family foundation

Establishment & Formation of an AG – From Articles of Association to Registration

You want to found an AG and live your dream of independence in reality? No problem! Because for the foundation of a GmbH a natural – or legal – person is completely sufficient. If you want, you can be the sole founder of the company – called a shareholder – and thus automatically be the sole managing member of the board of directors. Such a one-person AG is often called a “small public limited company”. However, it is not possible to go it alone: a “small AG” must appoint at least three supervisory board members, which means that the smallest possible public limited company consists of four people.

The process of founding an AG can be divided into two phases, namely the internal formation of the AG and the external formation of the AG. While the first phase is basically a kind of preparatory phase or pre-foundation – in other words, it forms the basic framework for your public limited company – in the second phase you present your company to the public.

Phase 1 – Preparation & Basic Framework

You set up your public limited company internally. One of the most important steps is to draw up articles of association for your AG – also known as a shareholders’ agreement – which must later be certified by a notary public. For the formulation of the articles of association, all founding members must be fully present and the future executive board and the future supervisory board must also be present. At this first meeting it is decided how announcements are to be made in the company and how many board members are to be appointed.

Together you also decide on the company name – i.e. the name of your company as it is to be entered in the commercial register -, the registered office, the amount of share capital – 50,000 euros or more – as well as the nominal value and the number of shares, including details of the respective share type. From bearer shares to par value shares – find out more about the individual types of shares here:

• Types of shares – transferability, legal scope & share capital breakdown

The second step is the acquisition of the shares and the appointment of the bodies of a joint stock company, which must be notarized. The deposit of the securities itself can also take place after the notary appointment. Optionally, the auditor for the annual financial statements can already be appointed here. The supervisory board then appoints the management board of the public limited company as its first official act. At this point at the latest, the contributions must also be paid into the business account until at least a quarter of the share capital has been recorded.

Phase 2 – Entry in the Commercial Register

To complete the formation process for your public limited company, your company must be entered in the commercial register. This step equips the public limited company with its own legal personality and signals to the public that a new public limited company exists on the market. The founding members together with the supervisory board and executive board carry out the application for registration in the commercial register together. An overview of all supervisory and executive board members, various deeds and notarial certifications are required, the contribution of the shares must be documented and a price for the subsequent share issue must be defined.

After all documents and records have been submitted, the registration court assesses whether the formation of the public limited company has been carried out properly. In a final step, the entry is made in the commercial register and your public limited company is officially deemed to be established.

The foundation process at a glance

Here is an overview of all the steps up to the official, externally effective formation of your corporation:

• Phase 1 – Establishment in the internal relationship
  • Adoption of the Articles of Association (certified by a notary)
  • Share acquisition
  • Appointment of the AG bodies (notarized)
  • Appointment of the auditor, if applicable
  • Payment of deposits (min. 1/4 share capital)
• Phase 2 – External incorporation
  • Application for registration
  • Submission of documents & records
  • Assessment by the registry court
  • Entry in the register of companies

Entry in the Commercial Register: The most important applications for AG founders

The internal relationship determines the beginning of the company as the date contractually agreed between the shareholders. In the external relationship, however, the formation of the AG is dated on the first action on behalf of the company, i.e. at the latest with the binding entry in the commercial register. Registration costs you on average around 200 to 300 euros and is usually carried out by a notary.

As you are registered in the commercial register as a shareholder of an AG, you can officially trade under a company name – just like a shareholder of a GmbH. This means that your company has a company name, i.e. an official name, which you can freely design together with the other shareholders. It doesn’t matter whether it’s a personal company, a real company, a fancy company or a mixed company… As long as the name is in line with the prohibition of misleading people and bears the suffix “AG”, almost anything is allowed.

Tax ID, Trade Licensing Office, Articles of Association & Notary Public

You will first receive a tax identification number – tax ID for short – from your local tax office, which serves as a basic prerequisite for all other formalities and applications. The registration of your AG as a company or commercial enterprise is carried out by the Trade Licensing Office for a processing fee of approximately 10 to 65 euros.

According to the law, there is no obligation to make additional contributions for stock corporations, in contrast to cooperatives with and without limited liability, just as there is for general partnerships (Offene Handelsgesellschaften, OHG) or limited partnerships (Kommanditgesellschaften, KG). In the case of shares with restricted transferability, however, it is possible to stipulate in the articles of association that the shareholders are to make recurring payments – excluding cash payments. The precise ancillary obligations of shareholders are explained in the German Stock Corporation Act (AktG).

Excerpt from the law – § 55 AktG:

(1) If the transfer of shares is subject to the consent of the company, the articles of association may impose on shareholders the obligation to make recurring non-cash contributions in addition to the contributions to the share capital. In doing so, they must determine whether the payments are to be made against payment or free of charge. The obligation and the scope of the benefits shall be stated in the shares and interim certificates.
(2. The statutes may lay down contractual penalties in the event of failure to fulfil the obligation or failure to fulfil it properly.

Excerpt from the law – § 180 AktG:

(1) A resolution imposing ancillary obligations on shareholders shall require the consent of all shareholders concerned in order to be effective.

(2) The same shall apply to a resolution by which the transfer of registered shares or interim certificates is made subject to the consent of the Company.

Equity capital: 50,000 Euro Share capital & reserves

The share capital of a joint-stock company is called capital stock, because it forms the basis for the equity capital of the joint-stock company. The share capital is defined as the sum of all contributions and is given the term “subscribed capital” in the balance sheet. A prerequisite for registration in the commercial register is the payment of the required share capital of at least 50,000 euros into the business account. This means that twice as much share capital is required for the formation of a public limited company as for the formation of a private limited company, where 25,000 euros is sufficient as share capital. A return of the share capital to the shareholders is not permitted.

Excerpt from the law – § 57 AktG:

(1) Shareholders may not be repaid their contributions. The payment of the purchase price in the case of a permissible acquisition of treasury shares shall not be deemed to be a return. Sentence 1 shall not apply in the case of payments which are made in the event of the existence of a control or profit and loss transfer agreement (§ 291) or which are covered by a fully-fledged claim for consideration or restitution against the shareholder. Sentence 1 also does not apply to the return of a shareholder loan and payments on receivables from legal acts that correspond economically to a shareholder loan.
(2) Interest may neither be promised nor paid to shareholders.
(3) Prior to the dissolution of the Company, only the distributable profit may be distributed among the shareholders.

The second pillar of equity is the capital reserves. This includes all amounts that are added to equity, for example by means of a premium – alternative designation: issue premium or premium – i.e. the amount by which securities are priced above their nominal value. If shares are issued, the premium must be allocated to the capital reserves and thus contributes to the equity capital shown in the balance sheet. In addition, there are the revenue reserves, which are made up of the statutory reserves, the reserves under the articles of association and other reserves.

Caution: Reserves and provisions are not the same thing: Reserves are amounts of money that are saved for security or emergencies. Reserves, on the other hand, represent future liabilities and therefore do not count as equity under any circumstances!

Dividend & Reserve Accumulation

The distribution of profits takes place differently in the joint-stock company Kraft legal form than in other forms of corporate law. As a share trading business, the shares are understood as profit shares, whereby one share corresponds exactly to one profit share. The shareholders of an AG therefore also do not receive a profit distribution, as is the case with the general partnership (OHG), the limited partnership (KG) and optionally also the limited liability company (GmbH), they rather receive so-called dividends. The distribution of dividends is decided by the general meeting.

In addition, the German Stock Corporation Act (AktG) requires stock corporations to form legal reserves until ten percent of the share capital is reached. For this purpose, five percent of the net income for the year is added to the statutory reserves each year – after adjustment of the net income for any losses carried forward from previous years. The same applies to the capital reserve, where contributions must also be made until the ten percent mark is reached.

Other revenue reserves are possible within the framework of the adoption of the annual financial statements by the Management Board and Supervisory Board. The allocation may amount to a maximum of half of the net income for the year; higher amounts are only permitted if the Articles of Association allow this. Further contributions may be made to the reserve if a corresponding resolution has been passed at the Annual General Meeting.

AG Organs: Management Board, Supervisory Board & Annual General Meeting

A joint stock company consists of several organs. These bodies are divided into:

1. The Board,
2. The Supervisory Board and
3. Annual General Meeting.

The Management Board deals with the day-to-day business and other matters of the company and represents the stock corporation externally. The Supervisory Board is a legally prescribed self-monitoring body that appoints and monitors the individual members of the Management Board and, in case of doubt, also removes them. Furthermore, it is responsible for the written reporting of the annual financial statements as well as for annual reports. The Annual General Meeting acts as the decision-making body of the stock corporation.

Liability of an AG – internal relationship & external relationship

In the event of a loss, the stock corporation as a legal entity under private law is, to a certain extent, subject to a limitation of liability, because the liability burdens – with a few rare exceptions – exclusively the business assets of the company. In the external relationship, therefore, only the share capital is liable for any losses. In the internal relationship, however, the liability claim can vary depending on the governing body of the AG.

• Liability in the external relationship with the AG: through share capital
• Liability in the internal relationship with the AG: by the executive bodies

If you want to know in detail how a limitation of liability for shareholders, management board and supervisory board affects the internal relationship, read more here:

• Limitation of liability for AG bodies

Advantages: Limitation of liability, financial independence & Co

After presenting the typical features of a public limited company, you have certainly already recognised the advantages that this legal form offers you: The high initial capital also makes the AG a reputable legal form, which can be an advantage especially in matters of company financing. Financial institutions are therefore often willing to issue good loans and business partners and customers gain more security due to the good credit rating.

At the same time, the financial risk remains relatively low, as the liability claims are limited to the share capital and the AG shareholders cannot be held liable externally with their private assets. Plus: As a listed legal form, stock corporations are financially independent through the IPO.

• Respected legal form
• High credit rating
• More security for banks, business partners & customers
• Low financial risk due to limitation of liability
• Financial independence through IPO

Disadvantages: Share capital, formal incorporation & GewSt

The disadvantages that the formation of an AG can bring with it are also quickly located: On the one hand, the high share capital of at least 50,000 euros is an obvious problem for many start-ups. Also the social adhesion measures itself accordingly on at least 50,000 euro. The foundation may not take place informally, but is subject to extensive formalities and specifications. Banks can easily leverage the exemption from liability if, despite high creditworthiness, they aim for a directly enforceable guarantee from the shareholders. Last but not least, the AG is subject to trade tax and, depending on the purpose of the company and how it is handled, has to pay further taxes.

• High share capital required
• Liability based on share capital
• No informal incorporation
• Banks may require directly enforceable guarantees
• High trade tax levies

Evaluation: Low-risk legal form for large companies

After comparing the advantages and disadvantages, it becomes clear that the formation process is significantly more complex and extensive than is the case, for example, with a civil law partnership (GbR) or even a limited liability company (GmbH). In addition to the formal formation, the appointment of the individual bodies of an AG is also obligatory and the formation process as a whole is very time-consuming. It is rather difficult for small to medium-sized companies to raise the necessary share capital. For larger companies, however, the legal form of an AG may be a good option for expanding and gaining an international foothold.

A public limited company makes particular sense if business projects are planned that are exposed to a high level of risk, as the shareholders can protect themselves well through limitations of liability in the external relationship and optionally also in the internal relationship and their private assets remain unaffected. Fast-growing companies can also benefit from the formation of an AG.

Immobilien AG: Holding, trading, managing, letting

You don’t think the idea of an AG is bad at all and are now asking yourself how you can combine your capital company with the real estate business? A real estate company is a company that serves the financing, development, realization, leasing or marketing of real estate – starting with a single property up to a real estate portfolio in the three- or multi-digit range. The management of real estate property or third-party real estate on behalf of third parties can also be handled by a real estate company.

• Real Estate AG / REIT-AG

Taxes for AG shareholders: corporate income tax, trade tax, VAT, capital tax & income tax

As a shareholder of a public limited company, you need to know about some types of tax, because when you set up your company, you receive income from your business and must of course also pay tax on this. In accordance with tax law, sales tax must therefore naturally be paid, insofar as the AG does not only carry out tax-free sales. Profit distributions to the shareholders of an AG are also subject to capital gains tax – for natural persons in the company, income tax is of course also due.

The following applies to all corporations: They are subject to corporate income tax. The payment of trade tax is also obligatory for an AG, even if all founding members were freelancers, because by virtue of its legal form it is always regarded as a commercial enterprise.

• Corporate income tax (KSt)
• Income tax (ESt)
• Capital gains tax (KapESt)
• Value added tax (VAT)
• Trade tax (GewSt)

Here’s the entire list:

• Taxes in Germany

Attention: As already mentioned, the obligation to pay corporation tax and trade tax does not apply to REIT real estate companies as soon as the real estate company fulfils the legal requirements!

You can find out what taxes you can expect with a real estate corporation here:

• Save taxes on real estate

Conclusion: Public limited company – For whom is it worthwhile?

The formation of a public limited company requires a large amount of capital and an equally large amount of administrative work. For this reason, an AG is more worthwhile for large companies which, on the one hand, have the corresponding financial resources and, on the other hand, are already characterised by a certain routine in business processes and legal issues. Start-ups with monetary reserves and real estate investors are given an attractive opportunity by an AG to realise their dreams and entrepreneurial goals.

In the real estate industry, stock corporations are a stable legal form for the purpose of real estate preservation, real estate management as well as trading with and brokering real estate portfolios. If you are already trading within the meaning of the REITG, you can expect significant tax benefits. Real estate stock corporations are worthwhile for a variety of people of different professions: From builders to financiers to real estate fund shareholders, the real estate corporation can contribute significantly to stable cash flow and capital growth.

Tip: Apart from the stock exchange, a public limited company without a stock exchange listing is particularly suitable for families to jointly manage existing real estate portfolios.

Comparison: Sole proprietorship, one-man GmbH, small AG or entrepreneurial company?

If you plan to set up your business on your own, you can choose between different legal forms of business: On the one hand, there is the classic sole proprietorship, in which you act as a freelancer or registered trader, or set up a small business. Alternatively, you can choose between the one-man limited liability company and the entrepreneurial company – often referred to as a “mini-GmbH” – or set up a small public limited company.

You can find out more about the different legal forms for solo founders here:

• Sole proprietorship (EU)
• One-man limited liability company – see GmbH
• Entrepreneurial company / UG (limited liability)

Sole proprietorship & one-person GmbH

Basically, there is not much difference between the two legal forms of a sole proprietorship and a single-member company, because in both cases you are the sole shareholder with sole power of management and sole power of representation. However, the decisive difference arises in the form of the liability issue: As a registered businessman (e. Kfm.) or registered businesswoman (e. Kff.) you are liable without limitation, directly and jointly and severally – as the sole shareholder of a one-person GmbH, on the other hand, you are liable exclusively for the business up to the amount of the capital contribution you have made.

Are you a sole proprietor yourself and no longer want to bear the enormous liability risk? Then you should think about converting your sole proprietorship into a one-person limited liability company. The change of form is easily accomplished, but can make a huge difference in case of losses! In order to avoid personal liability, as part of the registered traders (e. K.) you only need a notarial certificate confirming a value of at least 25,000 euros for your business and submit this to the commercial register together with the opening balance sheet. The sole proprietorship is practically brought into the GmbH as a contribution in kind.

Entrepreneurial company & small public limited company

Alternatively, you can consider setting up an entrepreneurial company (UG). Often referred to as a “small GmbH” or “mini-GmbH”, this legal form of company is a sub-form of the conventional limited liability company, but unlike the “normal” GmbH, it only requires a single euro as share capital. It is therefore particularly attractive for solo founders who do not have 25,500 euros in their bank account. Without the share capital of a GmbH, however, your image with the banks could be lower and your chances of getting a good loan could decrease.

The so-called “small AG” is primarily intended for individual shareholders who wish to keep their public limited company within a small group of people. Apart from the individual shareholder, who also equally assumes the role of the management board, only three other persons are required to be appointed as supervisory board members. However, the formation of a public limited company, regardless of its size, is very time-consuming and more cost-intensive than the other common forms of corporate law. Therefore, a one-person limited liability company or an entrepreneurial company may be more suitable if you intend to found your company on your own. Alternatively, you might also consider setting up a sole proprietorship.

AG: Special case real estate and more

1. Real estate stock corporation (REIT-AG)
2. Real estate shares: List of companies
3. Legal forms: List

Real estate stock corporation (REIT-AG)

Real estate stock corporation / REIT-AG – You don’t find the idea of a stock corporation bad at all and are now wondering how you can combine your capital company with the real estate industry? A real estate company is a company that serves the financing, development, realization, leasing, or marketing of real estate – starting with a single property up to a real estate portfolio in the three or multi-digit range. The management of real estate property or third-party real estate on behalf of third parties can also be handled by a real estate company.

• Real estate stock corporation (REIT-AG)

Real estate shares: List of companies

Real Estate Shares – Not everyone can afford real estate as a capital investment. Through real estate shares, however, everyone can participate in the real estate market and invest money. The share prices of the big players are rising year after year. Vonovia, Deutsche Wohnen, Dream Global, CBRE and Patrizia are a few of the best known active companies in Germany. In addition, there are more than 25 other companies. We have an overview of the most popular real estate stocks for you as an investor. But first a look at the risks of a stock, the stock market, for beginners and beginners. Now to the list and more on the real estate market, your investment options and all prices at a glance, here in the article on real estate stocks.

• Real Estate Stocks

Legal forms in Germany

Legal forms – What types of company are there? If you want to start your first company, then choosing the ideal legal form is one of the first steps in the process of setting up a company. Whether it’s a special real estate company or a start-up, I’ve summarized all the types of companies in Germany for you here.

• Legal forms: List

Company types in detail:

• Sole proprietorship
• Registered businessman / registered businesswoman (e. K.)
• Civil law partnership (GbR)
• General partnership (OHG)
• Limited partnership (KG)
• Entrepreneurial company (UG)
• GmbH: Limited liability company
• Real estate GmbH / Asset management GmbH
• Real estate stock corporation (REIT-AG)
• Societas Europaea (SE)
• Foundation / Family Foundation

GmbH: foundation, advantages and disadvantages

In the following, you will find out everything you need to know about setting up a GmbH. How do you become a shareholder of a GmbH? What are the differences between incomplete and complete companies? What are the advantages? What are the disadvantages? How do I set up a company? What is a company? You will get an answer to all these questions and more – explained simply and quickly. Plus everything you need to know about taxes in Germany and real estate trading.

Learn everything important about it here! In addition, you will find all German types of companies and legal forms, as well as tips on how to start a company, including the special case of real estate GmbH, family foundation & Co.

If you’re considering setting up a limited company, the first thing you need to know about is the incorporation process: Who can form what exactly, when and to how many… what are the differences and similarities between the various forms of company law? It is equally important to know the advantages and disadvantages of a GmbH: From profit distribution to saving taxes – an overview of the seven most important founding criteria for you.

What are the founding criteria?

1. Number of shareholders
2. Management
3. Foundation
4. Company name
5. Funding
6. Liability
7. Profit distribution

Corporation GmbH: Management according to HGB

In the entrepreneurial world, there are many different forms of business you can choose from. They are roughly divided into two categories, namely sole proprietorship and companies, which in turn are divided into incomplete companies – these include dormant companies and BGB companies – and complete companies – partnerships, corporations and some more.

The limited liability company – in short: GmbH – is one of the so-called complete companies and, in contrast to incomplete companies, is not subject to the German Civil Code (BGB) but to the German Commercial Code (HGB). As a corporation, the GmbH has a more complex structure than other forms of corporate law, as it cannot be formed informally like a general partnership (OHG), but requires notarisation of the shareholders’ agreement.

Other typical corporations:

• Entrepreneurial company / UG (limited liability)
• Stock corporation (AG)
• European Company (Societas Europaea, abbreviated to SE)
• Partnership limited by shares (KGaA)

Legal form variant GmbH & Co KGaA – KGaA with general partner GmbH

Sometimes the GmbH also appears in combination with a partnership limited by shares (KGaA). For example, family businesses occasionally organise themselves as a Gesellschaft mit beschränkter Haftung & Compagnie Kommanditgesellschaft auf Aktien – in short: GmbH & Co KGaA. In this case, they form a stock corporation in the legal sense – however, the general partner as personally liable shareholder is not just any natural person, but specifically a limited liability company (GmbH). If the general partner is instead embodied by an AG, it is referred to as an AG & Co KGaA, and in the case of a Societas Europaea, as an SE & Co KGaA.

More about the individual hybrid forms:

• AG & Co KGaA – see stock corporation (AG)
• SE & Co KGaA – see Societas Europaea (SE)

Companies operating under the legal form variant of the GmbH & Co KGaA have only existed since the end of the 1990s, after open legal questions were clearly explained by a court ruling of the Federal Supreme Court (BGF). The licensing departments of some well-known football clubs have opted to set up a GmbH & Co KGaA, as have many other companies from a wide range of industries: Food, pharmaceuticals, clothing, publishing and digital media, to name but a few.

Examples of GmbH & Co KGaA companies:

• Asklepios Clinics GmbH & Co. KGaA
• Borussia Dortmund GmbH & Co. KGaA
• CoinIX GmbH & Co. KGaA
• Funke Media Group GmbH & Co. KGaA
• H&R GmbH & Co. KGaA
• Jack Wolfskin Ausrüstung für Draußen GmbH & Co. KGaA
• Merz Pharma GmbH & Co. KGaA
• Mineralbrunnen Überkingen-Teinach GmbH & Co. KGaA
• NorCom Information Technology GmbH & Co. KGaA
• Paragon GmbH & Co. KGaA
• Schwartauer Werke GmbH & Co. KGaA
• Wiley-VCH GmbH & Co. KGaA

CEWE Stiftung & Co. KGaA is a special case: In this company, the general partner is embodied by a foundation. In principle, the partnership limited by shares is possible in all conceivable combinations, as GUB Investment Trust KGaA points out as an example.

Continue reading here on the topic of setting up a family foundation:

• Establish a family foundation

Foundation & management: alone, as a partner or in a team

You want to found a GmbH and live your dream of independence in reality? No problem! Because for the foundation of a GmbH one natural – or legal – person is completely sufficient. If you want, you can be the sole founder of the company and thus automatically take over the management alone. Founder duos, on the other hand, usually share the management, whereas in a multi-person GmbH all shareholders can exercise their co-management rights. Optionally, the position of managing director can also be outsourced and filled externally. In this case, one speaks of a commissioned external managing director.

Whoever ultimately holds the power of management… There is an obligation towards the other shareholders to provide information on the affairs of the GmbH and to submit the books and documents to them for inspection upon request.

Tip: A limited liability company is an excellent way to set up a family business. Due to the flexible possibilities to adapt the share capital and the business shares to the financial framework of all family members and to manage the business across generations, parents, children and grandchildren can jointly participate in the corporation.

Entry in the commercial register: The most important applications for GmbH founders

The internal relationship determines the beginning of the company as the date contractually agreed between the partners. In the external relationship, however, the formation of the GmbH is dated on the first action on behalf of the company, i.e. at the latest with the binding entry in the commercial register. Registration costs you on average around 200 to 300 euros and is usually carried out by a notary.

Since you are registered in the commercial register as a GmbH shareholder, you can – just like a OHG shareholder – officially trade under a company name. This means that your company has a company name, i.e. an official name, which you can freely design together with the other shareholders. It doesn’t matter whether it is a personal company, a real company, a fancy company or a mixed company… As long as the name is in the sense of the prohibition of misleading and the name is “Gesellschaft…. mbH” or carries the suffix “GmbH”, almost anything is allowed.

Tax ID, Trade Licensing Office, Articles of Association & Notary Public

You will first receive a tax identification number – tax ID for short – from your local tax office, which serves as a basic requirement for all other formalities and applications. The registration of the GmbH as a company or commercial enterprise is carried out by the Trade Licensing Office for a processing fee of approximately 10 to 65 euros.

Moreover, a so-called obligation to make additional contributions can also be agreed in the shareholders’ agreement. This is an optional limited or unlimited obligation of the partners to make further limited or unlimited additional contributions on top of the existing contributions. Such a requirement is usually linked to certain conditions or the occurrence of certain situations, such as the pending redevelopment of a property. According to the Law on Limited Liability Companies (GmbHG), such agreed additional contributions must be in proportion to the GmbH shares of the individual shareholders. However, by means of an abandonment – i.e. the relinquishment of one’s own shares in the company – it is possible to free oneself from an existing obligation to make additional contributions.

Excerpt from the law – § 26 GmbHG:

(1) The memorandum and articles of association may stipulate that the shareholders may decide to demand additional payments (additional contributions) over and above the nominal amounts of the shares.

(2) The payment of additional contributions shall be made in proportion to the shares held.

(3) The obligation to make additional contributions may be limited in the memorandum and articles of association to a certain amount to be determined in proportion to the shares held.

25,000 Euro share capital, half for cash foundation

A prerequisite for registration in the commercial register is the payment of the required share capital of at least EUR 25,000 into the business account. At least half of the specified amount must be paid into the business account when the GmbH is founded in cash. For the residual value it is irrelevant whether it is a cash contribution or a contribution in kind such as real estate, machinery, real estate liens, etc., the main thing is that the capital contribution is recognisably noted in the shareholders’ agreement according to its type.

Possible contributions in kind:

• Real Estate
• Machines
• Car
• Office & business equipment
• Copyright
• Real estate liens
• Trademark rights
• Patents
• Receivables recoverable

In general, share capital is defined as the sum of all capital contributions and is given the term “subscribed capital” in the balance sheet. The exact value is determined by the shareholders in the shareholders’ agreement and can vary for the individual shareholders. The prescribed minimum amount is set above 100 euros, whereby all higher-value contributions must be a multiple of 50. In addition, a quarter must be paid in as a minimum on each capital contribution until summa sumarum 12,500 euros is reached.

Profits, Losses & Liability

In contrast to partnerships such as the general partnership (OHG) and the limited partnership (KG), a profit made by a limited liability company is not necessarily paid out directly. Rather, the partners decide jointly how to proceed with the profit: In the case of a profit distribution, the calculation of the profit shares is carried out in proportion to the shares of the individual partners. In the case of a reserve formation, on the other hand, the profit is retained and contributes to the increase of the equity capital.

The limitation of liability is a decisive factor for the name of a GmbH and often a criterion for choosing this and no other legal form of a company. As a corporation, the GmbH is a legal entity under private law. This has the consequence that the individual partners are limited in their liability to the corporate assets and do not have to participate in the losses with their private assets in the case of corporate debts. Before registration in the commercial register, however, it is still a pre-GmbH and thus all shareholders involved in the pre-foundation are liable without limitation, directly and jointly and severally.

However, a separate liability applies to the managing director: In case of doubt, he is the only one who must also be liable with his private assets.

GmbH Bodies: Managing Director, Supervisory Board & General Meeting of Shareholders

A limited liability company consists of several organs. These bodies are divided into:

1. The directors,
2. The Supervisory Board and
3. The shareholders’ meeting.

The managing directors deal with the day-to-day business and other matters of the company and represent their company externally in accordance with the GmbHG. The supervisory board is required by law above a certain number of employees and acts as the company’s supervisory body by appointing and advising the management, but also by monitoring and, in case of doubt, dismissing it. Alternatively, its establishment can also be determined within the framework of the articles of association. The shareholders’ meeting acts as the decision-making body of the GmbH.

If you want to know more about the individual bodies of a limited company, read on here:

• Corporate bodies of a limited liability company

Advantages: Reputation, credit rating, security, flexibility & Co.

After presenting the typical characteristics of a limited liability company, you have certainly already recognised the advantages that this legal form offers you: The high start-up capital also makes the GmbH a reputable legal form, which can be an advantage especially in matters of company financing. Financial institutions are therefore often willing to issue good loans and business partners and customers gain more security due to the good credit rating.

Furthermore, contributions in kind are also accepted, so that it is not solely a matter of the cash assets of a shareholder. The financial risk, on the other hand, remains low, since the partners are not held liable with their private assets. Taxation with corporation tax is also more favourable in many cases than having to handle everything – as is the case with partnerships – via income tax.

Flexible GmbH models further allow to establish a GmbH both alone and among partners as well as in a team – the management can be arranged internally and externally for one or more persons. Shares in the GmbH can be bought and sold by both individuals and legal entities. This makes the change of shareholders much easier.

• Respected legal form
• High credit rating
• More security for banks, business partners & customers
• Contributions in kind are permissible
• Low financial risk due to limitation of liability
• More favourable taxation with corporation tax
• High flexibility in structure & management
• Legal entities are accepted as shareholders
• Simple change of shareholders

Disadvantages: Trade tax liability, 25.000 Euro share capital & liability

The disadvantages, which the establishment of a GmbH can bring with itself, are likewise fast localized: On the one hand, the high share capital of at least 25,000 euros is an obvious problem for many start-ups. Also the social adhesion measures itself accordingly to at least 25,000 euro. The foundation may not take place informally, but is subject to extensive formalities and specifications. In case of doubt, the managing director is also liable with his private assets. Banks can easily leverage the exemption from liability if, despite high creditworthiness, they aim for a directly enforceable guarantee from the shareholders. Last but not least, the GmbH is subject to trade tax and, depending on the purpose of the company and how it is handled, has to pay further taxes.

• High share capital required
• Liability based on share capital
• No informal incorporation
• Possible private liability for managing directors
• Banks may require directly enforceable guarantees
• High trade tax levies

Evaluation: Invest, Risk & Hedge

After comparing the advantages and disadvantages, it becomes clear: At first glance, the formation process seems complex and much more extensive than, for example, with a civil law partnership (GbR)… Basically, however, the process is not overly difficult, especially if it is a one-person company. A limited liability company makes particular sense if business projects are planned that are exposed to a high level of risk, or if the managing director and shareholder are one and the same person. Business founders with monetary reserves and real estate investors are given many options for structuring and managing their dreams and entrepreneurial goals through a GmbH.

Especially for families, the GmbH is often a suitable legal form, since each family member can contribute to the company according to his or her qualifications, possibilities and reliability, and changes can easily be made across generations.

GmbH models with and without shareholders

As a sole shareholder, you are your own boss: you are founder, shareholder and managing director at the same time and can set up your GmbH entirely according to your wishes. If the entrepreneurial responsibility is too high for you or if you have plans for whose implementation you are dependent on several people, you can bring in as many co-founders as you wish or add them to the GmbH later. You can also divide the management authority among one or more persons. The multi-person GmbH is therefore the most common GmbH model.

By appointing new shareholders or leaving existing shareholders, the limited company model you choose can easily change. Whether it’s a one-person company, a two-person limited liability company or even a company that operates without any shareholders at all…. In each case, there are specifics you should be aware of as they deviate from the norm of the traditional limited liability company. In the following, you will learn the most important aspects for solo founders, founding duos and team founders in order to be able to make an informed decision regarding the form of company that is best suited to you and your plans before you start your own business.

• Two-person limited liability company
• One-person limited liability company
• No-Person-GmbH

Tip: For GmbH formations with a maximum of three shareholders, a sample protocol is available that can significantly simplify the formation process for you.

Immobilien GmbH: Management, Leasing, Marketing & Co.

You think the idea of a limited liability company is not bad at all and are now wondering how you can combine your capital company with the real estate business? A real estate company is a company that serves the financing, development, realization, leasing or marketing of real estate – starting with a single property up to a real estate portfolio in the three- or multi-digit range. The management of real estate property or third-party real estate on behalf of third parties can also be handled by a real estate company.

Small tip: When acquiring and/or managing real estate, make sure that all details are clearly stated in the partnership agreement.

Vermögensverwaltende GmbH – Variant 1: Advantages of the Immobilien GmbH

This variant of the asset-managing GmbH is often referred to as a leasing company due to the advantages associated with it. It impresses with several advantages, first and foremost impressive tax advantages: Instead of having to pay tax on the rental property privately at high rates (income tax, solidarity surcharge, church tax), a corporation placed in front of the property can save taxes to a considerable extent. The rental income is counted as business income and is therefore taxed at the corporate tax rate, which significantly reduces the overall tax burden.

Furthermore, the renting and leasing of private real estate property is generally not considered a commercial activity, which would have to be regarded as taxable. The pure asset management takes place outside the general economic traffic, which is why the trade tax is completely omitted upon application to the competent tax office. In order not to risk a later taxation with the full trade tax rate, you should outsource all commercial administrative as well as manual tasks as a precaution.

Attention: In the case of a real estate GmbH, the usual distribution of profits is not provided for, as the shareholders must charge the final withholding tax on their earnings in the event of a distribution of profits. Instead, any savings resulting from the tax benefits will be used to repay debts or as an asset investment.

Asset-managing GmbH – Variant 2: Advantages of the holding company

This variant of the asset-managing GmbH is – in contrast to the Immobilien GmbH presented above – a commercial real estate company. Here, direct participations are combined in a hierarchically superior parent company – called a holding company. In addition to holdings in corporations such as the GmbH and the AG, other corporate legal forms can also be incorporated. One of the purposes of a holding company is to save taxes: By combining the various company holdings, no capital gains tax is levied in the event of a profit distribution.

Taxes for GmbH shareholders: KSt, GewSt, USt & Co.

As a GmbH shareholder, you need to know about some types of tax, because with the establishment of your company you receive income from your business and must of course also pay tax on this. In accordance with tax law, sales tax must therefore naturally be paid, insofar as the GmbH does not only carry out tax-free sales. The following applies to all corporations: They are subject to corporate income tax. An exemption from taxation is possible under certain circumstances, for example if the GmbH meets the criteria for non-profit status. The payment of trade tax is also obligatory for a GmbH, even if all founding members were freelancers, because by virtue of its legal form it is always regarded as a commercial enterprise.

• Corporate income tax (KSt)
• Trade tax (GewSt)
• Value added tax (VAT)
• Income tax (ESt)
• Capital gains tax (KapESt)

Other taxes: LSt for employees, GrESt & GrSt

As an employer, the GmbH is of course also responsible for the payment of income tax for all persons in an employment relationship with it. Under tax law, the managing director is considered a dependent employee. When a property is purchased, a one-time land transfer tax is due. It is always demanded if the company not only rents real estate, but acquires it by purchase. For all real estate owned by the GmbH, the real estate tax is then also applied.

• Wage tax (LSt)
• Real estate transfer tax (GrESt)
• Property tax (GrSt)

You can find out what taxes you can expect with a real estate corporation here:

• Save taxes on real estate

Conclusion: Limited liability company – For whom is it worthwhile?

With versatile GmbH models you can start your dream of your own company in any constellation and have the possibility to react flexibly to changes in the number of shareholders. Whether you prefer to work alone or in a team – a GmbH offers solo founders, team founders and entrepreneurial partnerships a suitable legal form to handle even risky transactions skillfully and without private liability. The easy introduction of new shareholders and changeable management allow for a cross-generational management of the corporation and can also organize a secure succession.

In real estate terms, asset-managing real estate companies are particularly worthwhile for start-ups and investors with high private assets who wish to manage, rent out and, if necessary, sell their own and/or third-party real estate portfolios on a non-commercial (Immobilien GmbH) or commercial (Holding) basis. The GmbH is also a good choice for long-term transfers of real estate property to children and grandchildren. Furthermore, the capital contributed to the GmbH is protected even if private financial bottlenecks arise.

Comparison: Sole proprietorship, one-man GmbH, small AG or entrepreneurial company?

If you plan to set up your business on your own, you can choose between different legal forms of business: On the one hand, there is the classic sole proprietorship, in which you act as a freelancer or registered trader, or set up a small business. Alternatively, you can choose between the one-man limited liability company and the entrepreneurial company – often referred to as a “mini-GmbH” – or set up a small public limited company.

Sole proprietorship & one-person GmbH

Basically, there is not much difference between the two legal forms of a sole proprietorship and a single-member company, because in both cases you are the sole shareholder with sole power of management and sole power of representation. However, the decisive difference arises in the form of the liability issue: As a registered businessman (e. Kfm.) or registered businesswoman (e. Kff.) you are liable without limitation, directly and jointly and severally – as the sole shareholder of a one-person GmbH, on the other hand, you are liable exclusively for the business up to the amount of the capital contribution you have made.

Are you a sole proprietor yourself and no longer want to bear the enormous liability risk? Then you should think about converting your sole proprietorship into a one-person limited liability company. The change of form is easily accomplished, but can make a huge difference in case of losses! In order to avoid personal liability, as part of the registered traders (e. K.) you only need a notarial certificate confirming a value of at least 25,000 euros for your business and submit this to the commercial register together with the opening balance sheet. The sole proprietorship is practically brought into the GmbH as a contribution in kind.

Entrepreneurial company & small public limited company

Alternatively, you can consider setting up an entrepreneurial company (UG). Often referred to as a “small GmbH” or “mini-GmbH”, this legal form of company is a sub-form of the conventional limited liability company, but unlike the “normal” GmbH, it only requires a single euro as share capital. It is therefore particularly attractive for solo founders who do not have 25,500 euros in their bank account. Without the share capital of a GmbH, however, your image with the banks could be lower and your chances of getting a good loan could decrease.

The so-called “small AG” is primarily intended for individual shareholders who wish to keep their public limited company within a small group of people. Apart from the individual shareholder, who also equally assumes the role of the management board, only three other persons are required to be appointed as supervisory board members. However, the formation of a public limited company, regardless of its size, is very complex and more cost-intensive than the other common forms of corporate law. Therefore, a one-person limited liability company or an entrepreneurial company may be more suitable if you intend to found your company on your own. Alternatively, you may also consider setting up a sole proprietorship.

You can find out more about the different legal forms for solo founders here:

• Sole proprietorship (EU)
• Entrepreneurial company / UG (limited liability)
• Small public limited company – see AG

Reading tip: Legal forms & real estate GmbH

1. Legal forms: List
2. Real estate GmbH / Asset management GmbH

Legal forms: List

Legal forms – What types of company are there? If you want to start your first company, then choosing the ideal legal form is one of the first steps in the process of setting up a company. Whether it’s a special real estate company or a start-up, I’ve summarized all the types of companies in Germany for you here.

• Legal forms: List

Company types in detail:

• Sole proprietorship
• Registered businessman / registered businesswoman (e. K.)
• Civil law partnership (GbR)
• General partnership (OHG)
• Limited partnership (KG)
• Entrepreneurial company (UG)
• Real estate GmbH / Asset management GmbH
• Stock corporation (AG)
• Real estate stock corporation (REIT-AG)
• Societas Europaea (SE)
• Foundation / Family Foundation

Real estate GmbH / Asset management GmbH

In this article you will learn the basics about real estate companies. Briefly explained: A real estate company is a company that pursues the purpose of renting, developing, financing, realizing and/or marketing. It doesn’t matter if it’s one property or multiple properties. The management of residential and commercial real estate – in its own interest or as a service offered to third parties – is also a popular focus for real estate companies and asset management GmbHs. Find out more about the main advantages and disadvantages of buying real estate and the expected costs.

• Real estate company