What are the notary costs for forming a GmbH?

Contents

• Why do you need a notary to form a GmbH?
• What are the notary fees for?
• Costs
• Warning
• How notary costs are calculated
• Variable notary fees 
• Other expenses
• Cost savings
• Outsourcing
• Notary costs for share purchase or sale

Why do you need a notary to form a GmbH?

The bureaucratic and legal part of setting up a business raises questions for many founders. For example, is it possible to set up a limited liability company without a notary? The answer is simply, no. Visiting the notary is mandatory to form a limited liability company.

This obligation is spelled out in the GmbH law. The same applies to the  Unternehmergesellschaft (UG) i.e. the so-called “Mini-GmbH” and the Aktiengesellschaft (AG).

All legal forms belonging to corporations must be entered in the commercial register (Handelsregister) of the competent register court (Registergericht). The notary serves as a link between the Handelsregister and the independent merchants.

What do founders of a GmbH pay a notary for?

In Germany, the notary attends to several stages of the formation phase at the same time. As a rule, a notary charges for the following items:

• Notarisation of the articles of association (Gesellschaftsvertrag) which is the shareholder agreement
• Formation resolution (Gründungsbeschluss)
• Notarisation of the appointment of the CEO
• Creating and sending the XML file
• Preparation of the list of shareholders (Gesellschafterliste)
• Registration in the commercial register (Handelsregister)
• Other expenses

It’s clear that the notary’s service costs depend on your individual wishes. Thus the preparation of the articles of association costs more than a company formation with a Musterprotokoll (literally translated it means model protocol – a standardised articles and registration statement). If you also decide to exceed the required minimum share capital of €25,000 for the establishment of a GmbH, additional costs will also be incurred.

You should also know about GmbH Shareholder Rights and Obligations

What fees can a notary charge to incorporate a company?

The notary fees are not arbitrary. In Germany, the law on costs of for courts and notaries (the GNotKG) regulates the total amount of costs incurred. The current prices have been valid since 2013.

The fees for filing and entry in the Handelsregister are also regulated throughout Germany and are invoiced by the relevant local courts.

The costs depend on the number of shareholders. The notary’s cost calculation is always based on the object value/value of the matter (Gegenstandswert). The higher the Gegenstandswert, the higher the fees. The fee directory in the GNotKG regulates which fee rates are applied. In the following table, you’ll find an overview of the costs for the most common variants of establishing a GmbH.

Starting a business in Germany can be taxing
Get advice from a tax adviser who knows SMEs 

Notary costs using customised articles of association

Cost summary using articles of association

After the notarisation, there are still further administrative costs for the founders. Here is a summary of the average costs:

Notary costs using the Musterprotokoll (model articles of association)

Cost summary using the Musterprotokoll

After the notarisation, there are still further administrative costs for the founders. Here is a summary of the average costs:

Sources: IHK Berlin [PDF], firma.de statistics derived from notary invoices (as of 2023)

*All figures are average prices and may vary from case to case. They are based on a Gerichts- und Notarkostengesetz fee chart as well as our own calculations from notary invoices from across Germany. This example assumes one managing director and a share capital amount under €7,000. If the amount of share capital exceeds €7,000, the fees increase by approximately €60. Additional managing directors or a greater object value can influence the multipliers and fixed costs that form the basis of these fees.

¹ Average sum of both fixed costs (notarising the founding documents and the commercial register application)
² Average value, billed per page
³ Average value, each municipality sets the fee for a business registration independently

Beware of bargain incorporations

Information on additional costs should be clearly stated in the offer. Due to the notary fees, it’s not possible to incorporate a GmbH for less than €500. Moreover, this minimum limit is only realistic if you are forming a GmbH with the minimum share capital allowed, one shareholder and the Musterprotokoll. As soon as you form a GmbH with several shareholders, you can not use the cheaper Musterprotokoll to form your company.

The notary’s costs can never be predicted exactly, as there are always some variable invoice items in addition to the statutory fees. So be sure to read the small print if you are offered GmbH start-ups at a suspiciously low price.

The notary’s office and the local court invoice the respective fees themselves and cannot be included in GmbH formation services.

How notary costs are calculated

The Gegenstandswert of a limited liability company depends on the amount of the paid share capital. Calculating the costs is based on a minimum value of €30,000, with the maximum value being € 10 million. In addition, the number of shareholders determines a multiplication factor.

Example: Assume that the value of your company is €30,000. A fee of €125 is charged for the minimum item value. As a one-person limited liability company, the notary charges a simple fee of €125. As a multi-person limited liability company, the fees are multiplied by a factor of 2. So the fees in this example are around €250.

There are basic fees and calculation rates for almost all cost items, depending on the number of shareholders and the value of the item. For your specific case, you can calculate the notary’s costs using the cost schedule and table B of fees in the German Court and Notary Costs Act.

As a general rule, the higher the share capital, the greater the Gegenstandswert will be. The higher the Gegenstandswert, the more expensive the company formation will be.

Which notarial costs vary when setting up a GmbH?

Sachgründungsbericht: Formation report of non-cash assets

This is required if you want to contribute non-cash assets instead of a cash contribution. The non-cash asset report includes a list and presentation (composition, age, value) and the valuation methods of your assets in kind. The report must be signed by all shareholders.

Betreuungsgebühr: Supervision of the share capital contribution service fee

Your notary supervises the deposit of your share capital and the transfer of your deposit slip from the bank to the registry court. This additional cost is often classified as a ‘Betreuungsgebühr‘ (supervision/care service fee).

Preparation of the list of shareholders

This list must be drawn up and notarised if you are incorporating with your own statutes. If you establish a GmbH with a Musterprotokoll, no list of shareholders is required.

Notarisation of the appointment of the CEO

This only affects the formation of your GmbH if you create customised articles of association. If you establish a GmbH with Musterprotokol, these costs don’t apply.

Other expenses

This covers costs for postage, telephone calls, stationery, printouts, copies, fax plus VAT. The amount that the notary will charge you for the additional expenses is not fixed. Usually, a flat rate covers all communication costs.

Tip: The cost calculator of the Federal Chamber of Notaries (Bundesnotarkammer) is one way of calculating costs in advance relatively accurately. The Excel-based program can be downloaded free of charge from the website of the Bundesnotarkammer.

Which invoice items can you save on?

Forming a GmbH with a Musterprotokoll

There’s no good general answer as to whether the cost savings from the use of the Musterprotokoll are worth it. Does your company meet the requirements for the use of the model protocol? If you want to form a company with more than three partners or more than one CEO, establishing a GmbH with the Musterprotokoll isn’t possible.

If you also want to have the chance to structure the takeover, power of representation or in the event of the withdrawal of a shareholder, you’ll have to have customised articles of association drawn up. So ask yourself which regulations should and must be spelled out in the contract. If a model protocol doesn’t cover these scenarios or areas, you’re saving at the wrong end.

Later down the track new articles of association can replace the Musterprotokoll, but additional notarial costs will be incurred. Any savings made when setting up a company with a model protocol will, therefore, be offset by subsequent fees.

Our suggestion: Let a notary advise you. In the case of multi-person companies, you will probably be advised to have individualised articles of association. The Federal Chamber of Notaries is an important contact when searching for a notary.

Which processes can you outsource?

The creation of the list of shareholders and the coordination with the IHK (chamber of industry and commerce) for naming the company is included in one item. In any case, you can draw up the list of shareholders yourself. However, if you make a mistake and your document is rejected by the IHK you will delay the formation of your company.

You can handle both processes yourself with the necessary know-how. However, you run the risk of a serious delay. Alternatively, you can outsource the notarial services, if you need help or don’t have the time to get through the steps of the GmbH incorporation process.

Starting your own business in Germany is heavy on the red tape
Book one of our GmbH start-up packages and we’ll slay the bureaucratic dragon for you.

Notary costs for the purchase and sale of shares in a GmbH

If you want to sell shares in a GmbH, the notarial costs are calculated based on the requirements of the German Court and Costs Act and the German Commercial Code (§54 GNotKG and § 266 para. 3 HGB). The amount of the notary fees depends on the sales value of the shares and the number of notarised transactions.

Another factor in the calculation is the amount of equity.  The notary uses the last balance sheet as the basis for calculation.

Suppose you want to sell your company share to the other shareholders. There’s a possibility to save notary costs here. What are the costs paying for?

• Notarisation of the transfer of company shares
• Notarisation of the approval of the sale by the shareholders
• Certification of multilingual documents

The certification of the consent to the sale is often spelled out in the GmbH articles of association. In principle, it’s correct that the shareholders must agree to the sale of shares in a GmbH. However, if you are a buyer yourself, the notary authenticates the same transaction twice with the same transaction value. Notary fees are incurred for both authentications.

Tip: There’s no legal necessity to notarise both resolutions. A simple record of the decision to approve the sale is sufficient.¹

Regarding the third cost factor: If not all parties are native German speakers, a lingua franca is often necessary. Notaries can also notarise contracts and resolutions in a foreign language. There are of course double costs for duplicates. A surcharge will be added to the usual fees for foreign-language certifications.

Tip: Avoid the surcharge and the costs for double authentication by preparing a bilingual document (e.g. alternating German and lingua franca or in two columns). The prerequisite for simple certification is that the translation is not be done by the notary and that you declare the German version to be binding.¹

With these two simple tricks, you can save notary costs when selling shares and when buying shares in GmbH.

Source: ¹ http://www.fgvw.de/neues/archiv-2014/notargebuehren-gestiegen-richtige-gestaltung-spart-geld (last visited: 21.08.2017)