UG (haftungsbeschränkt).
From €1. Same liability shield as a GmbH.
The Mini-GmbH is a sub-form of GmbH under § 5a GmbHG. Lower capital entry, 25% profit retention, conversion to full GmbH built into the statute.
The Unternehmergesellschaft (haftungsbeschränkt), legal shorthand "UG (haftungsbeschränkt)" or colloquially Mini-GmbH, lives inside § 5a GmbHG. Same liability shield as a GmbH (§ 13 (2) GmbHG), same governance, same tax treatment. The difference is upfront capital (from €1 vs €25,000) and a 25% statutory profit-retention rule that ends when your combined capital plus reserves reaches €25,000.
The capital rule
§ 5a (1) GmbHG allows any amount from €1. § 5a (2) GmbHG requires full cash payment at registration; in-kind contributions are not permitted. Shares must be divisible by €1 (§ 5 (2) GmbHG).
The 25% profit-retention rule
§ 5a (3) GmbHG requires 25% of annual profit to be allocated to a statutory reserve. The reserve can only be used to (a) increase capital to GmbH level, (b) cover losses, (c) cover carry-forward losses. It cannot be distributed to shareholders.
The rule ends the moment statutory reserve plus existing capital reaches €25,000. From that point, the UG can convert to a full GmbH (§ 5a (5) GmbHG) by shareholder resolution, amended Satzung, and Handelsregister filing. Same HRB number, same tax number, same bank account.
Musterprotokoll path
If you have at most 3 shareholders, one managing director, and cash contribution, you can use the Musterprotokoll under § 2 (1a) GmbHG. Notary fee scales with Geschäftswert: for a €1,000 UG, that is typically €100 to €200. Beyond three shareholders or non-standard governance, you need a custom Satzung.
When a UG fits
Solo founder, pre-revenue bootstrap, freelancer stepping up to a corporate shield, profit reinvestment anyway. When you need VC funding, large-counterparty procurement approval, bank credit lines or a regulatory licence, go straight to a GmbH. Banks in particular apply a discount to UG balance sheets when scoring credit.
Tax is identical to GmbH
Körperschaftsteuer 15% + Solz 5.5% on KSt = 15.825%. Gewerbesteuer at the municipal Hebesatz (14.35 to 17.15% in our 4 cities). Combined 28 to 33%. See the full corporate tax stack.
UG formation, step by step
Frequently asked questions
What is the minimum capital to form a German UG in 2026?
€1 under § 5a GmbHG. It must be paid in full, in cash, before registration; in-kind contributions are not allowed.
Must I pay in the capital before registration?
Yes. UG differs from GmbH here: 100% paid-in required at registration (GmbH requires only 50% minimum).
What is the 25% profit-retention rule?
§ 5a (3) GmbHG requires 25% of annual profit to the statutory reserve until reserve + capital hits €25,000. The reserve cannot be distributed.
When can my UG convert to a full GmbH?
When reserve + capital ≥ €25,000, under § 5a (5) GmbHG. Shareholder resolution, amended Satzung, Handelsregister filing; HRB number, tax number and bank account stay the same.
Does a UG really have the same liability shield as a GmbH?
Yes. Same § 13 (2) GmbHG shield, same personal liability only for director breaches under § 43 GmbHG.
Do German banks treat a UG differently from a GmbH?
Yes. Banks discount UG balance sheets for credit, some decline credit lines entirely, and procurement teams at larger counterparties often require GmbH minimum.
Can a UG be used as a Holding company?
Technically yes; § 8b KStG applies to any Körperschaft. But a UG-Holding signals thin capital to banks and tax auditors. Use a GmbH as Holding.
Musterprotokoll or individual Satzung, which should I pick?
Musterprotokoll if ≤3 shareholders, 1 director, cash-only contribution. Custom Satzung if you need vesting, drag-along, share classes, or beyond 3 shareholders.
How long does UG formation take end-to-end?
2 to 4 weeks typical. Musterprotokoll path is on the fast end.
How much does UG formation cost?
Pass-throughs: €300 to €900 (notary + HR + IHK). Our legal scope: €900 to €1,500 typical.
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