That’s not correct. Creating a UG will set you back hundreds of EUR for notary fees, commerce registry entries etc. And you have to prepare your annual accounts, which, if you let a professional handle it, will easily cost you hundreds more
All in all, I'd say cost of doing business. What's next, do we atart complaining that Lenovo isn't providong free laptops? Or that office space costs money?
Could you provide a source for this claim?
In a best-case scenario, where you have founded your company on Jan 1 2021, you so far would have still had to
- hand in your initial balance sheet at the time of founding
- hand in your Umsatzsteuervoranmeldung every month.
Moreover, you will definitely have to
- hand in your Umsatzsteuererklärung, Körperschaftsteuererklärung, Gewerbesteuererklärung (all for 2021) by 31.07.2022
- send your "electronic tax balance sheet" (Elektronische Steuerbilanz / eBilanz) for 2021 to the tax authorities by 31.07.22
- set up your balance sheet for 2021 by 31.06.22 and send it to Bundesanzeiger by 31.12.22
The law very clearly disagrees with you:
https://www.gesetze-im-internet.de/hgb/__242.html
> And your deadlines are longer than if you eork with a registered tax advisor.
True. If you're paying a tax advisor, you don't really care about the deadlines and all the paperwork, anyway, though. You just pay people to do all that for you.
I've never heard about this and also can't find any sources for that when googling. Could you post an article that describes why a UG wouldn't have to file a "Jahresabschluss" in the first two years?
Product market fit doesn't matter if you are unable to run a business.
An American company will focus on American market and while doing that is - due to using a wide spread language - immediately useable world wide and then can adapt to languages and cultures over time.
The point is not that startups shouldn't follow regulations, it's that startups are a uniquely weak type of venture, but with the potential to be tremendously valuable to society. So designing a set of regulations for startups that balances the benefits to society of the regulation with the benefits to society of the potential startups is likely to lead to better outcomes for society.
As an analogy - in the city I live in, no-one is allowed to do any digging around a tree without prior permission from the city tree specialist. That regulation is designed to prevent large construction companies from damaging old and valued trees in the community. But in theory, a child planting an apple seed or small tree without permission would be breaking the regulation - can you see how that might reduce the number of trees being planted? The answer is not to remove the regulation, but to have exemptions or light-weight versions of the regulations for those use cases, and then apply more stringent regulations as the company (or tree) grows and becomes more robust and healthy.
Here is the thing: Most of these "startups" are never raising any money, let alone millions. The burden of regulation should be split into pre-raising and post-raising. (Many governments have figured that out with income, like if you have less than xx.xxx per year, you can get away from some reporting).
Startups don't begin with million of VC money which is what we're discussing here.