So you're saying for a small UG you should always spare 1-2 years (most likely more than 1) in case you decide not to pursue the business anymore? I'd rather spend 2-5k on other things.
Apart from being an absurdly high amount for something that can be read out easily from any sane accounting system (thanks Germany for basically forcing everyone to use Datev, which they obviously only sell to professionals, so that's how a simple task becomes 2k+ per year [0]).
> Maybe they do want to make sure that the process stays legitimate
That doesn't really solve the problem, I've had clients with GmBHs who ended up not paying what they owed me - just because they pay a lot to accountants, notary, the state etc. doesn't make the business more sound. Conversely, you can handle a legitimate business (e.g. selling expertise in form of consulting projects) much cheaper and with less time invested elsewhere.
Maybe if everyone weren't wasting so much manpower on inefficient systems, things would actually work.
The added burden of dealing with personal tax, the high price tag for it along with social welfare (which only helps in highly rare circumstances, e.g. when I literally don't have anything anymore - which I don't need because of what I've invested) and the time lost just don't add up.
I've lived in many countries, small, large, rich, poor, and I think Germany is the worst among them to start a business (and also to live, but everyone has their preferences) unless you have a really good reason to be there.
To start something you need flexibility, low overhead, and not to waste time you could be using to talk to customers and build something, rather than deal with bureaucracy. Germany offers neither.
[0]: one quick note on the side, I've used Collmex to do my own accounting back then after I had to fire my tax accountant for absurd things I was being charged and to wrap up the business that I wasn't working on anymore. For me it worked out - in principle what is accounting: you want to track receipts and transform them into a balance sheet and P&L statement + a few of the extras you need in Germany, like VAT reporting. Still a massive pain to transform it into what the tax agency wants and get the info what that actually is, I think it's hard on purpose to waste people's time and direct them to tax accountants that overcharge.
Anyway, time invested vs. paying someone to do it probably doesn't fully add up but I learned a bit more about accounting which is nice to have in any business context.
> So you're saying for a small UG you should always spare 1-2 years (most likely more than 1) in case you decide not to pursue the business anymore? I'd rather spend 2-5k on other things.
I am telling you that if a company runs out of funds to sustain its operations, it's bankrupt. In Germany it is called Insolvenz. You can feel as emotional about it as you want, but that's what it is called. Yes, you absolutely need to take this into consideration, if you want to shut down a company gracefully. You need to have that financial resource available. You can, of course, finance your company by capitalizing it with extra funds and that's really simple - you put the money in the bank account of the company and write a document as a director stating what has happened.
In any country in the world, when a company does not have money to pay its obligations, it's bankrupt.
Well to me it’s quite unfriendly to small businesses to (without telling you in advance - UG is always advertised as the simplification that it isn’t) require so much money for essentially nothing. I think it should be much cheaper and easier to shut down a business. Yes, there are alternatives, but nothing is really great to start a business there, especially if you want to bootstrap and not get a massive apparatus running before you have a good market fit.
My impression of Germany was that they try to force you to keep things going on forever - health insurance, pension, etc. as soon as you want to change something you lose a ton of money. Also: don’t ever criticize anything because they obviously really know what they’re doing.
> I've lived in many countries, small, large, rich, poor, and I think Ger many is the worst among them to start a business (and also to live, but everyone has their preferences) unless you have a really good reason to be there.
Try India. There was an HN post the other day about a guy who tried to set up some manufacturing and 2 years in he was still far away from all the permits.
One thing the article we are discussing notably lacks is the mention of bribes. Obviously, you'd add, those would be illegal. Haha. True! They are illegal in India too. And in all other countries. But compared to some forms that are (outrageously!) in German, those re a real PITA.
I'm living in Germany now, by choice, and it's a lovely country with lovely people. Not everything is perfect, but many of the imperfections contribute to the loveliness. Just like in many other countries, rich and poor.
Agree that bribes should be part of the analysis, but I would do the comparison with the time and cost to accomplish a goal, without judging the method.
If you look at the outrageously high fees and lack of competition (notaries and tax accounts - yes there’s a bunch out there but it’s not the market dictating the fee and no guarantees that they won’t work towards a suboptimal outcome) I don’t really see how bribes are worse. In Germany corruption has just moved up the chain making everything expensive.
Overall it’s a lost opportunity to create wealth, jobs and a competitive advantage, both in India and Germany.
Then there’s the bit about personal preference. I didn’t see anything good in Germany, but happy for you if you do and live there.
> Agree that bribes should be part of the analysis, but I would do the comparison with the time and cost to accomplish a goal, without judging the method.
I'm sure you can get your business quickly off the ground if you are friends with the dictator in a country with an oppressive regime. (Others go to jail but that's less important apparently.)
So you're saying for a small UG you should always spare 1-2 years (most likely more than 1) in case you decide not to pursue the business anymore? I'd rather spend 2-5k on other things.
Apart from being an absurdly high amount for something that can be read out easily from any sane accounting system (thanks Germany for basically forcing everyone to use Datev, which they obviously only sell to professionals, so that's how a simple task becomes 2k+ per year [0]).
> Maybe they do want to make sure that the process stays legitimate
That doesn't really solve the problem, I've had clients with GmBHs who ended up not paying what they owed me - just because they pay a lot to accountants, notary, the state etc. doesn't make the business more sound. Conversely, you can handle a legitimate business (e.g. selling expertise in form of consulting projects) much cheaper and with less time invested elsewhere.
Maybe if everyone weren't wasting so much manpower on inefficient systems, things would actually work.
The added burden of dealing with personal tax, the high price tag for it along with social welfare (which only helps in highly rare circumstances, e.g. when I literally don't have anything anymore - which I don't need because of what I've invested) and the time lost just don't add up.
I've lived in many countries, small, large, rich, poor, and I think Germany is the worst among them to start a business (and also to live, but everyone has their preferences) unless you have a really good reason to be there.
To start something you need flexibility, low overhead, and not to waste time you could be using to talk to customers and build something, rather than deal with bureaucracy. Germany offers neither.
[0]: one quick note on the side, I've used Collmex to do my own accounting back then after I had to fire my tax accountant for absurd things I was being charged and to wrap up the business that I wasn't working on anymore. For me it worked out - in principle what is accounting: you want to track receipts and transform them into a balance sheet and P&L statement + a few of the extras you need in Germany, like VAT reporting. Still a massive pain to transform it into what the tax agency wants and get the info what that actually is, I think it's hard on purpose to waste people's time and direct them to tax accountants that overcharge.
Anyway, time invested vs. paying someone to do it probably doesn't fully add up but I learned a bit more about accounting which is nice to have in any business context.