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UG / GmbH:

  • Type: Limited liability company
  • Capital Requirement:
    • UG: Minimum 1 EUR
    • GmbH: Minimum 25,000 EUR
  • Liability: Shareholders’ liability is limited to their capital contribution
  • Purpose: Suitable for small to medium-sized businesses (UG often used for startups)
  • Management: Managed by one or more managing directors (Geschäftsführer)
  • Taxation: Subject to corporate tax (Körperschaftsteuer) and trade tax (Gewerbesteuer)

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UG & Co. KG / GmbH & Co. KG:

  • Type: Hybrid between a limited liability company (UG/GmbH) and a limited partnership (KG)
  • Capital Requirement:
    • UG & Co. KG: 1 EUR minimum for the UG
    • GmbH & Co. KG: 25,000 EUR minimum for the GmbH
  • Liability:
    • General partner (UG or GmbH) has limited liability
    • Limited partners’ liability is restricted to their investment
  • Purpose: Combines the benefits of limited liability with the tax advantages of a partnership
  • Management: Managed by the general partner (the UG or GmbH)
  • Taxation: Taxed as a partnership, with personal income tax for partners and trade tax for the company

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KG (Kommanditgesellschaft):

  • Type: Limited partnership
  • Capital Requirement: No specific minimum capital requirement
  • Liability:
    • General partner has unlimited liability
    • Limited partners’ liability is restricted to their investment
  • Purpose: Used by businesses that want to involve external investors without giving them full control
  • Management: General partner manages the company
  • Taxation: Taxed as a partnership, with personal income tax for partners and trade tax for the company