UG (Unternehmergesellschaft)

30 posts in this topic

Hallo,

 

Can somebody explain me what exactly UG is and what are the rules for this, and also if somebody has documents in english please send me a link.

 

thanking you for your information.

 

Regards,

KALR

0

Share this post


Link to post
Share on other sites

The problem is everything am getting in German,if you have some information in english, can you please provide it..thanking you

1

Share this post


Link to post
Share on other sites

 

The problem is everything am getting in German,if you have some information in english,

Have you bothered to read that link that eurovol took the time to give you? That information is in English. There's even great big English language pdf attachments about how to set up companies.

 

Maybe this sort of approach explains why you "have a problem"? If this is how you act (can't be bothered) and reply (impolitely and inaccurately and "me, me, me, I want more") with people who actually do give you what you ask for - in their own time and for free - then good luck as an "entrepeneur". You will need it. Goodwill will run out fast.

 

Finally, a tip from one English-speaking "entrepeneur" to another. To borrow the famous words of our deputy chancellor: this is Germany! The information you need to run your business is in German. You can't keep asking other people to tell you stuff (except perhaps if they are family, but even then it's a lot of work). You need to (1) learn German (2) put the German through a translation website in your own time or (3) pay experts to advise you. Perhaps all three.

5

Share this post


Link to post
Share on other sites

A UG is a small private company with limited liability. The full name is Unternehmergesellschaft (haftungsbeschränkt), meaning entrepreneurial company (with limited liability). Apparently it is a quite new development in Germany, a sub-type of the German GmbH (Gesellschaft mit beschränkter Haftung--company with limited liability), meant to compete with Britain's small private limited companies. Here's a PDF on it.

 

I don't know what swimmer's problem is. You said your pleases and thank yous. It's not like you're forcing us to answer or something.

7

Share this post


Link to post
Share on other sites

Can anyone explain what difference it makes how much capital you invest in a new UG? I have heard it should be over 300 euro, with 500 suggested as a practical minimum, but a full GmbH is 25,000 so I'd guess somewhere between 500 and 25,0000 but how should I decide?

 

I found this but I'm still a bit in the dark what the effect would be:

 

 

Bei der Gründung einer Kapitalgesellschaft können Sie die Haftung des Unternehmens auf die Höhe des von Ihnen gewählten Stammkapitals begrenzen. Bei der GmbH muss das Stammkapital mindestens EUR 25.000 betragen. Bei der UG können Sie ein Stammkapital zwischen EUR 1 und EUR 24.999 frei wählen, müssen aber zwingend den nicht abkürzbaren Firmenzusatz "UG (haftungsbeschränkt)" tragen und dürfen nicht den gesamten erzielten Gewinn ausschütten (Thesaurierungspflicht in Höhe von 1/4). Die Höhe des Stammkapitals wird in das Handelsregister eingetragen. Ferner ist zu berücksichtigen, dass Sie bei Kapitalgesellschaften einen erhöhten Verwaltungsaufwand haben (Pflicht zur Erstellung eines Jahresabschlusses, Veröffentlichungspflichten).

 

 

0

Share this post


Link to post
Share on other sites

HellesAngel: I had to go thru this because the IHK would not give the license for an insurance broker to a UK Ltd., thus we had to set up a subsidiary of our main company and I really did not want to bind more capital than necessarry with a unit that is only a tool to fulfill typical German red-tape administration below the existing and well established main corporation.

 

First of all, you can buy a ready-made UG (haftungsbeschränkt) thru a service from a company called GoAhead. Costs a wee bit more than if you do all yourself, but you get fully legally approved founding documents including a bank account and all and can start basically your business within 48 hrs. The initial capital of the company in the form of the UG (haftungsbeschränkt) can be rather low as you describe, but you have to put aside profits after each year until you reach the 25k required to transform it into a GmbH. So, in the end, the UG is meant to be a way to offer the entrepreneurial security for new business of a GmbH without requiring the high capital input at the beginning and allows you then gradually to transform it into a GmbH. Of course, because of the low capital, many (if not most) banks, leasing companies, suppliers etc will require the owner/director to cover personally for any loans or invoices for larger quantities of goods...but the same is true for most new GmbHs, too.

For many freelancers who are in danger of being considered "Scheinselbstständig" or, in teaching occupations, would face the danger of having to pay 19.x% of their income for public pension, this is also a rather inexpensive way to avoid these troubles and risks because as a 1-man UG/Gmbh you can pay yourself a salary while the company bills your client(s) and thus you can never be considered "Scheinselbständig". From a taxation point it certainly has pros and cons which weigh differently depending on what kind of business you are running, thus a tax advisor should be consulted before doing that.

 

If anyone wants some info about my experience with GoAhead, please feel free to PM me, happy to share this info as I was (and still am)quite pleased about the professional services they offer to this regards.

 

Cheerio

7

Share this post


Link to post
Share on other sites

Thanks Starshollow. So essentially whatever capital the UG starts with doesn't really matter as the idea is the UG heads towards a full GmbH later, and until it reaches the full 25k capital the company is referred to as HellesAngel Beer Drinking Services UG (haftungsbeschränkt).

0

Share this post


Link to post
Share on other sites

 

Thanks Starshollow. So essentially whatever capital the UG starts with doesn't really matter as the idea is the UG heads towards a full GmbH later, and until it reaches the full 25k capital the company is referred to as HellesAngel Beer Drinking Services UG (haftungsbeschränkt).

 

This is correct. As you can see in the part from your quote above, it states that at least 1/4 of your profits (after taxes) have to be put aside to fill up the capital stock of the UG until it reaches the level where it can be transformed into a GmbH

 

 

Is there a difference between a UG and a GmbH iG?

 

Yes. The UG is also called a "Mini-GmbH" and there are less requirements to the capital and also to certain legal requirements initially. It is therefore a separate form of corporation compared to a GmbH, even though it also shares a lot of commonalities. See below some of the advantages compared to founding a GmbH

 

A GmbH i.G means it is "in Gründung" and thus not all initial steps to make it a formally registered GmbH have been reached. Normally this title is used after the company has been founded with a contract but before the contract and the company are registered in the "Handelsregister" because in the meantime you have to show proof that the capital stock has been paid in and that the directors are not barred from their position by legal means (because of fraud in the past etc). During the time a GmbH is "in Gründung, all shareholder still are liable for any claims against the company together just like a BGB-Gesellschaft. UNtil an UG is registered in the Handelregister, it would also be considered to be an UG i.G., btw. Which is why I personally chose the way to purchase a company that had already been legally created by GoAhead and just change certain parts of the contract and registration with a notary appointment because such a company was not an i.G. anymore and already registered in the Handelsregister of BONN.

 

</h3>

 

 

<h3>Die Mini-GmbH – Ihre Vorteile auf einen Blick

Vorteil 1:

Niedriges Stammkapital ab 1 Euro

Bereits ab 1 Euro Stammkapital können Sie eine Unternehmergesellschaft (haftungsbeschränkt) gründen. Dem steht eine Einlage von EUR 25.000 bei der GmbH gegenüber. Vorteil 2:

Beschränkte Haftung

Mit einer Unternehmergesellschaft (haftungsbeschränkt) sind Sie genauso wie mit einer GmbH vor dem Durchgriff auf Ihr Privatvermögen geschützt.

 

Vorteil 3:

Schnelle Gründung

Die Unternehmergesellschaft (haftungsbeschränkt) ist mit der notariellen Beurkundung bereits eine Gesellschaft in Gründung und damit handlungsfähig. Durch den Eintrag im Handelsregister erreicht der Gesellschafter den sicheren Haftungsschutz - was etwa 2 bis 3 Wochen dauert.

 

Vorteil 4:

Geringerer Kostenaufwand

Wenn Sie eines der beiden vom Gesetzgeber vorgegebenen Musterprotokolle verwenden, ist die notarielle Beurkundung kostenbegünstigt.

 

Vorteil 5:

Deutsches Recht

Die Unternehmergesellschaft (haftungsbeschränkt) unterliegt allein dem deutschen Recht, was eventuelle Vorbehalte wegen des niedrigen Stammkapitals verringert.

 

Vorteil 6:

Hinführung zur GmbH

Eine Unternehmergesellschaft (haftungsbeschränkt) ist zur Rücklagenbildung verpflichtet. Jahr für Jahr werden 25 % ihres Gewinns nach Steuern als Gewinnrücklage bilanziert - bis das Stammkapital für eine GmbH erreicht ist.

 

Cheerio

0

Share this post


Link to post
Share on other sites

I thought UG stood for UGly. Also makes you think of UGg boots...

 

I suppose its a good idea though, alternative to the hassle of a GmbH.

 

But why don't they just make GmbHs easier to form and to run, instead of creating yet another category.

 

I'd rather have a GmbH than an UG. But for that matter I'd rather have a LTD than a GmbH.

 

Wonder if UGs get discriminated against compared to GmbHs eg by banks, suppliers, clients etc?

 

Why can't we just have an EU wide corporate company form?

0

Share this post


Link to post
Share on other sites

it was actually the German IHKs (international chamber of commerce) who lobbied for the UG/mini-GmbH as a German "answer" answer to the growing number of Ltd. coming to Germany. Evern since some changes in EU regulations some years ago, people in Germany could open and run a Ltd. in Germany and that appears to have created some problems with how German bankruptcy laws etc. which are quite tough, can be used on a Ltd. At the same time the IHKs and the politicians started to understand that the threshold to put 25k EUR into the founding of a GmbH (plus notary fees and other costs) was simply too high, so German legislation came up with the Mini-GmbH instead.

 

I agree, a EU-wide recognized corporation structure would be a nice thing to have, but just remember how long it took to develop a simple unified plug for electric tools etc accross continental Europe and of course without the UK joining in...

 

Both a Ltd and an UG are still frowned upon by German banks, insurances and suppliers. So, yes, you will find it harder at some levels to get accepted and recognized with these company forms until you have done >2 years business and can back up your success with numbers/balance sheets. Until then, while the "limited" is supposed to protect new business start-ups to lose all their private means and wealth in case of failure, it does not work as any lender of credit will ask the director and/or owners to guarantee for the credit personally.

 

Still, for Germany it was a positive development, I think. But it would have been easier to accept and embrace the British style Ltd as an alternative to the GmbH.

 

Cheerio

0

Share this post


Link to post
Share on other sites

 

I agree, a EU-wide recognized corporation structure would be a nice thing to have, but just remember how long it took to develop a simple unified plug for electric tools etc accross continental Europe and of course without the UK joining in...

 

Say no more. Phone sockets and plugs are the same. Or rather not the same, they still tend to be different in each EU country as well.

 

 

Both a Ltd and an UG are still frowned upon by German banks, insurances and suppliers. So, yes, you will find it harder at some levels to get accepted and recognized with these company forms until you have done >2 years business and can back up your success with numbers/balance sheets. Until then, while the "limited" is supposed to protect new business start-ups to lose all their private means and wealth in case of failure, it does not work as any lender of credit will ask the director and/or owners to guarantee for the credit personally.

 

What I suspected. And thats why Id much rather they modified the GmbH regulations, rather than creating a "second-class" company designation.

 

 

At the same time the IHKs and the politicians started to understand that the threshold to put 25k EUR into the founding of a GmbH (plus notary fees and other costs) was simply too high, so German legislation came up with the Mini-GmbH instead.

 

These politicians never cease to amaze with how they always follow on so way behind events: "politicians started to understand...".

0

Share this post


Link to post
Share on other sites

I was just googling and TT searching something similar! A work colleague and I have a great idea for a business and want to run a pilot scheme to test the waters so to speak. It would just be the two of us, certainly for the next year or so as we would be able to handle any growth ourselves. There is no conflict with our current employment. There is a business plan in place, the area studied and now all that's left is to see if what is written on paper transfers to reality!

 

I'm having trouble trying to get my head around setting up a business. We have very little capital so a GmBh is out of the question so I guess that leaves the UG option. Are there any others? Also, my business partner to be is Iranian and its got a little bit confusing as to whether or not he is actually allowed to own a business in Germany as he isn't an E.U citizen. He has a student residence permit that expires at the end in 9 months and then after that he has 1 year working visa.

 

Would it be easier for me to register the company in the UK and have a Berlin office? Or would this just create more paperwork and hassle? It is of little concern whether we have ltd or UG after our name as we would be trading throughout Europe, except of course trying to get a business bank account...

0

Share this post


Link to post
Share on other sites

If your friend had a permanent residency here and so was properly registered then I doubt if there would be any restriction on him being a company owner. On a student visa & temporary working visa I don't know. You saw Starshollow's post above? Try giving GoAhead a call and see what they say.

0

Share this post


Link to post
Share on other sites

Ownership of company shares is never restricted by where you have residence. Any person from Iran can buy shares from BMW or Thyssen-Krupp and it is not different in any way or form as to how big a company is and how much of the shares you own.

As HellesAngel says above, you might want to try out the services from GoAhead because they offer both, Ltd and UG, ready made if you want and in the case of the British Ltd. good legal help to establish the German branch (Zweigniederlassung) in Germany even though for the first year or two you would actually not need to do even that.

If you are going to do business Europe wide I would personally rather go for a Ltd. as this is certainly a company form more people outside Germany can relate to than the UG. We at our company established our company exactly for that reason as Ltd. because our main clients usually have a background from Anglo-American culture and thus can relate better to a Ltd. in my opinion than with a GmbH. The UG as subsidiary was only necessarry additionally because as insurance broker you need a license and the IHK in Germany for policital reasons did not accept our application as Ltd. for registration and said we would need to register with the British FAS - which I would have happily done, but the FSA won't register a business that only works outside the UK. Hence we needed to create the UG which is 100% owned by the Ltd. to fulfill these legal requirements. But I think personally that the Ltd. is the better company form.

Still, the folks who are designing and creating our new website (soon to be launched) also created their new company as UG for the time being and will transform it in 1-2 years with the profits from the first years into a GmbH and they are smart businessmen. So, there are a lot people out there who think that the UG is a good idea and for German focused businesses I would certainly rather opt for a UG than for a Ltd. Your case, however, sounds different.

Opening bank account is no prob for a Ltd - at least not with a Sparkasse. And everything else would be taken care off by the full service of a provider like GoAhead. I am sure there are more out there offering such services, I am only rooting for them from very positive personal past experience.

 

Cheerio

0

Share this post


Link to post
Share on other sites

A word of warning to anyone who is thinking of starting a company - there are, as ever, scammers out to deceive you and in Germany they're as bold as ever. The most profligate are the various 'Handelsregister' companies that produce directories of companies. They send out highly official looking letters like the attached and seem highly plausible. Be careful what you pay...

 

post-4088-13229991503221_thumb.jpg

 

You can read more here and here. There are loads of these companies and the bills can come for over 800 euro. To paraphrase a widely respected TT financial advisor: So many bastards, so few bullets.

5

Share this post


Link to post
Share on other sites

Here's another good one. The text hasn't come out too well but it's worth a read, note the shabby grey paper like the Finanzamt uses and the various terms about obligations and requirements; you have to really study it to know if it's a scam or not.

 

post-4088-13230006640065_thumb.jpg

post-4088-13230007468778_thumb.jpg

 

Answer: It's a scam.

3

Share this post


Link to post
Share on other sites

Thanks for the heads-up, HellesAngel - my employer (GmbH) recently went through change of MD and I had an absolute flood of these letters for a couple weeks after! They all look official, but they are ALL, without exception, scams. There is one, and one only, that needs to be paid, and in our case it was less than 50 Euros - as opposed to the scams, that ask for 500 Euro and upward. At the time, I meant to post a warning here as well, but unfortunately forgot in the press of everyday stress.

0

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!


Register a new account

Sign in

Already have an account? Sign in here.


Sign In Now