This is what you should consider if you want to register a business

Almost everyone who wants to become self-employed has to register a business. But how exactly does a business registration actually work? Where to do it?

Registering a trade

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Almost everyone who wants to be self-employed has to register a business.

But how exactly does a business registration actually work?? Where to do it? And what is required to register a business?? You can find the answers to these and other questions in this article.

What is the business registration?

Business registration is a bureaucratic process that involves registering a business with the relevant authority.

In the course of registering a business, it is also checked whether you meet all the requirements for taking up a particular trade or not.

At the same time, the term is also used for the document that you must fill out and submit in the course of registration.

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How does a business registration work??

The registration of a trade is not as complicated as you might think. Basically, it can be divided into these four steps:

Step 1: Download or request the form

First of all, you need to obtain the document for registering a trade (also called a trade license). For this you can contact your local trade office or simply use the Internet.

Most trade offices now make all the important documents (including those for registering and deregistering a trade) available online.

Step 2: Fill out the form

Once you have the form, the next step is to fill it out completely and, of course, truthfully.

The trade license requires you to u.a. Details of:

  • of your person (name, place of residence, date of birth, etc.).)
  • Name of the business
  • Address(es) of the company
  • Legal form (this must already be determined before the business registration)
  • Place and number of the trade register entry (if available/needed)
  • Details of the planned activity

Step 3: Submit further documents

As a rule, you must present your identity card or passport when registering a business.

In addition, there are a number of types of business for which you must submit special documents when registering.

In the section "Documents for business registration" we will tell you which documents you need to fill in.

Whether you have to submit special documents (and if so, which ones) depends on whether you are practicing a trade that requires a license or supervision. You can find more detailed information on this in the Trade Regulation Act (GewO).

Step 4: Submit all documents to the trade office

Once you have filled out the trade license and gathered any required documents, you can submit everything to the trade office. You have various options for this:

  • personal
  • by mail
  • by fax
  • electronically (rather the exception)

Good to know: The electronic transmission of the business registration is still rather the exception. If you still cannot or do not want to appear in person at the Trade Licensing Office, we recommend that you send the documents by mail or fax.

However, it can also happen that your trade office insists on a personal appearance – for example, if you want to carry out a trade that requires a license or supervision.

What happens after the business registration?

Once the Trade Licensing Office has ensured that you meet all the requirements for carrying out a particular trade, it will pass on your data to various other authorities and offices.

This includes among others:

  • Tax office
  • Chamber of Industry and Commerce or Chamber of Crafts
  • Employment agency
  • Health insurance

Once this is done, you will first receive mail – for example, the tax registration questionnaire from the tax office (important for assigning your tax number) and from the IHK or. HWK (who will inform you about your compulsory membership).

In addition, you will be automatically entered in the municipal trade register after registering your business. In addition, you will receive a stamped copy of the business registration, which will serve as proof.

The most important aspect for founders is this one: As soon as you have completed the business registration, you can officially start your business.

Who is required to register a trade?

In Germany, according to GewO §14, there is a general obligation to register a business.

This means: Anyone who starts a self-employed business with the intention of making a profit must register it with the trade licensing office.

This regulation applies regardless of the size and legal form of your trade.

If you do not comply with the obligation to register your business, you risk fines and high back taxes. In the worst case, you will no longer be allowed to register a trade in the sector you want to work in.

Good to know: Only freelancers and companies that belong to the so-called primary production (agriculture and forestry, horticulture and viticulture) are not required to register.

Documents for the business registration

The question "What do I need for the business registration??"cannot be answered in a generalized way.

Fact: Everyone who wants to register a trade needs a completely and correctly filled out trade license. In addition, it is always an advantage to have your identity card or passport at hand when you go to the Trade Licensing Office.

In addition, there are numerous special features that apply in particular to trades that require a license and supervision.

The special documents for the business registration are, among others:

  • Restaurant license
  • police clearance certificate
  • Trade card
  • Master craftsman’s certificate
  • Special permits and licenses

Please inform yourself individually which documents you need for your business registration. It would simply go beyond the scope of this article to go into detail about each individual case here.

Place of business registration

If you are wondering where to register your business, the answer is: Where you want to work or where your business is located. Your place of residence is irrelevant and you are welcome to live elsewhere.

The fastest way to find out where you have to register your business is on the Internet. Simply enter "Business registration location XY" and you will receive all the information you need.

Duration of the business registration

A business registration is basically a quick matter. If you are well prepared and follow the four steps described above, you can complete the actual application in a few minutes.

For a smooth process, it is important that you

  • fill out the trade license completely and correctly
  • you have all the required documents together and can present them

Costs of the business registration

Another question that many founders ask themselves: How much does the business registration cost?

Again, a general answer is not possible – because each trade office asks the founders with different amounts to the cash.

The processing fees for the business registration are determined by the respective municipality. They usually vary between 10 and 60 euros. In most cases, costs between 20 and 25 euros will be due.

Frequently asked questions

Below you will find answers to frequently asked questions on this topic.

When is a business registration required?

As soon as you intend to start a self-employed business activity and earn money with it, you must register a trade.

In Germany there is an obligation to do so. If you oppose it, it is a violation of the trade regulations. In this case, you will face fines and worse penalties.

Where can I find the business registration form?

If you want to register a trade, you must first find out which trade office is responsible for you. A short internet search will help you to do this.

In the next step, you can then find out whether the business registration form is also available online. Alternatively, you can visit the Trade Licensing Office in person and ask for the trade license.

When is the right time to register your business??

The business registration must be made at the latest at the time of commencement of business.

It is important that you already have an entry in the commercial register (if required for your legal form) when you register your business.

How long is it possible to register a business retroactively??

In principle, a retroactive registration of your business is not possible. However, if you are a few days late, a trade office will hardly impose a fine immediately.

Nevertheless, you should not necessarily take the risk. If you miss the business registration (intentionally or unintentionally) and thus disregard the trade regulations, you may risk high fines.

Is the business registration to be equated with the trade license?

When the term "business registration" is used for the form required for this purpose, it is a synonym for the trade license.

In principle, however, a distinction can be made between:

  • Business registration as an activity or bureaucratic procedure
  • Trade license as the form needed for this process

Can you deduct the business registration?

The costs incurred for a business registration are considered to be normal business expenses. You can therefore deduct them from your taxes without any problems.

Who must sign the business registration?

A trade is registered by the trader.

In concrete terms, this means for the individual business forms:

  • Sole proprietorship: The owner signs
  • Partnership: the managing director(s) or managing partner(s) sign(s)
  • Capital company: the managing director(s) or managing partner(s) sign the form

Can I give a power of attorney for the business registration?

Yes, it is possible for a third party to register the business with the help of a power of attorney.

In order to ensure that everything runs smoothly, you should inform yourself once again at the trade office beforehand.

When do you receive a tax number after registering a business??

As soon as you have registered your business, the Trade Licensing Office will transfer your data to the tax office. This in turn sends you the questionnaire for tax registration.

Once you have filled out and returned the form, it usually takes a few more days until you receive your tax number.

Good to know: It is permitted to issue invoices without a tax number during this transitional period. It is important then, however, the reference to the fact that you have already applied for the number.

Who does not need a business registration?

If you count as a freelancer, you generally don’t need to register a business.

The same applies to people who start their own business in forestry, agriculture, horticulture or viticulture.

Is it possible to register a business at 16?

In principle, minors are also allowed to register a business in Germany. However, some special rules apply to them, which must be observed at all costs.

You can find more information on this topic here.

Do I need a business registration also for a sideline business??

The obligation to notify a trade applies regardless of the size of the company.

This means that even a small business that is carried out as a sideline must be registered with the Trade Licensing Office.

Summary

Business registration is something the vast majority of founders can’t avoid. But even if the procedure seems daunting at first, you can be sure: Everything is not so bad.

If you have gone through the previous process of setting up a business (opening a business account, obtaining permits, possibly going to a notary, etc.), you should know what to do.), the business registration is the least of your worries. Promised.

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