Five months and €9,600 to start a German company — and still no invoice sent

A founder chronicles the cost of incorporating his second German business: roughly €7,600 in fees plus €2,000 in share capital locked in an untouchable account, accumulated over five months across a notary, two courts, a law firm, a tax firm, and software vendors. Every one of those parties managed to bill him on schedule. He, meanwhile, still cannot issue a single invoice of his own, because the VAT ID he needs for cross-border reverse-charge billing has yet to arrive — by post. The process chains each step to the next, attaches a fee to every link, and lets a founder rack up legal, notarial, court, and subscription costs on zero revenue before granting the one permission a company exists for.

The piece contrasts this with Estonia’s online registration and the UK’s same-day, low-cost incorporation, arguing there is no inherent reason the process must take months and travel by mail. The author is skeptical of the official justification — that all the checks exist to keep out bad actors — noting the same system failed to catch the €2 billion Wirecard fraud while reliably deterring legitimate new founders. He also can’t simply leave: exiting Germany would trigger a six-figure exit tax on unrealized gains from his first company.

Two asides underline the absurdity. His chosen name, ‘Plenty,’ was rejected as too generic (German law demands distinctiveness), and after weeks of rejected variants he got approval only by deleting a space to form ‘PlentyLabs.’ He also explains the UG & Co. KG structure — a two-entity arrangement that secures limited liability and sane single-layer taxation while sidestepping the GmbH’s €25,000 capital requirement, which the UG instead claws back in installments from annual profits.