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Comment by robtro | Hacker News Reader

Germany is one of the worst countries when it comes to bureaucracy nothing is fast here if you go the legal path and stay within the law (which is mostly for small people big players have different ways) and as you see everything costs a lot so if you are founding a pure online business do yourself a favor and incorporate somewhere else and if you still live in Germany look into licensing or subcontracting yourself to your company in another country it's way more flexible and you probably have Easier access to grants etc.

Another part is taxation the tax office takes your money really fast but returns can be another slog where the tax office denies legal claims again and again untill you get a lawyer etc. and it generates costs again needlessly because it's really dependent on who works on your tax records and there mood apparently.

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I have yet to find the mythical efficiency everyone was talking about.

Trains, Berlin Brandenburg Airport, this.

It's rules and adherence to rules, more than efficiency, that I've found in my experience.

There is no efficiency to be found.

It's a "cover your ass" mentality that resists any changes.

Another recent example : https://www.telegraph.co.uk/world-news/2026/06/10/germanys-h...

They laid 600+km of cables wrong ultimately delaying the project by 6 years.

The efficiency is a thing of the past, an mainly when dealing with manufacturing, which we were really good at.

The world got faster, but german industries and politics never got the memo.

My experience with German colleagues is not efficiency; but they do have a remarkable ability (in my field) to read a 400 page regulator rulebook and overlay it on a 200 page design document and pinpoint the rulebook edge cases not covered by the design...

> I have yet to find the mythical efficiency everyone was talking about.

Comes down to a misrepresentation of history. Germans were never known to be efficient, they were known to be precise with everything, including bureaucracy. This happens to be handy with machinery, but not much else.

...but their machinery (or cars and motorcycles at least) are needlessly complex and unbelievably frustrating to work on.

Really I think that they just landed on some really successful marketing.

> Really I think that they just landed on some really successful marketing.

It depends. For some machinery the complexity is inherent, this makes German machines very good at what they do. But this approach does not tend to scale well, which is part of the reason the German economy tends to be fairly specialized with „hidden champion“ SMEs.

Made in Germany has (had?) a very positive connotation to it, but for historic reasons.

Japanese engineers seem to have figured out the "inherent complexity".

This was an advantage when bureaucracy was still young. It's a beast that only grows though.

Germans a rule based and were really precise which came in handy like 50 years ago. The modern German is not flexible enough for the modern job market. German companies are also not flexible enough to compete. Germany goes downhill for a reason.

It's a mistake to think Germany is efficient, I don't know where they got that stereotype.

Germans are thorough, not efficient.

It’s from >50y ago, then became a meme detached from reality. And for some reasons people are still repeating it even if they know literally nothing about the country

Don't incorporate somewhere else it will only lead to disaster. The company will end up being German tax resident anyways due to management and control being in Germany as you live in Germany .

Then you have to be compliant in 2 jurisdictions (file forms/balance sheets in both countries etc..) and worst case you could become subject to double taxation (if there is no agreement).

The optimal solution is just to leave Germany .

Can't you just incorporate a Wyoming LLC (zero corporate tax + federal tax because you're non-resident in the US) then just open a Wise account?

Wyoming LLC gives passthrough taxation, and because you're in Germany, you'll be subject to German corporate and personal taxes alone, I presume?

Edit: changed from just personal tax to personal+corporate

Finanzamt may well decide this is a German company in the cunning disguise of a cowboy hat, and charge it German corporate tax

Which is still fine imo. My idea was not about skipping German corporate or personal taxes - it was about skipping German bureaucracy.

> it was about skipping German bureaucracy

By creating a company that requires a special filing status to the German tax office?

Ouch, is that painful too? Damn.

Bookmarking for my personal posterity.

What should the US LLC do ? It will end up being treated like a GMBH in Germany (keyword : Typenvergleich ) and you will have to do all the bureaucracy in the us + Germany and end up paying the same taxes

The point I thought was a plus was that you'd be paying German taxes without all the German bureaucracy? Because there's definitely no bureaucracy for a Wyoming LLC except for a couple of IRS forms annually.

from what I know this is very much possible, you can also use tax treaties to transfer taxation to Germany.

e.g. Irish Ltd that is a resident in Germany

you won't have to bother with the naming problems etc. either

Unfortunately it doesn't work like that. You are just adding us bureaucracy+ dual accounting (euro/USD) to German bureaucracy where nothing changes .

My point is that US bureaucracy is very minimal - like I said, just need to submit a couple of forms to the IRS as a foreign-owned LLC.

Do not know Germany's specific tax code, but in most EU countries should a control fire up it would result in tax evasion (not even tax avoidance), as in this case Germany can easily demonstrate the center of control is in fact in Germany.

Especially as you will have to file tax forms and disclosures for your salary.

You guys might want to take a consultation with a proper accountant/tax advisor for these setups.

> The optimal solution is just to leave Germany

Just go to one of them Baltic states. They actually have a functioning electronic ids and other necessary infrastructure.

There’s no reason to live in Germany if you’re working with international clients.

Malta and Cyprus offer much better quality of life and also significantly less taxes .

Also Polands IP Box(5% tax rate) regime can be very interesting to software engineers right across the border.

> Malta and Cyprus offer much better quality of life and also significantly less taxes .

To each their own, I guess. I can't imagine living on those islands.

I do not know an EU or Asian country that doesn’t have a similar paperwork misery; I had a company in DE and in many others; you won’t survive in Spain as SL if you are small and follow the rules either. So literally no one does. No different in DE. We never got fined or even reprimanded. Largest fine in DE we got was for charging the wrong VAT for some items and that was not really that bad compared to all the tax breaks we got.

In Romania it's so bad that there are companies who will handle everything for you, even if technically the chamber of commerce has a digital interface as well. Everything is handled online and you get digitally signed papers in a reasonable amount of time.

This is probably the solution, an EU-wide company that has local offshoots and can handle the bureaucracy for a fee.

When there is an industry offering workarounds-as-a-service, then it is time for legal reform.

As far as I know, incorporating a BV in the Netherlands can be done in 1-2 weeks, with a lot of less pain. Many services are integrated and available online.

Estonia makes it very easy.

I don't think you've lived in many EU or Asian countries... While incorporation sucks in France, Spain, and Germany, in most North European countries, East European countries, and even in most Balkan countries, it's a breeze (when compared to Germany).

Incorporation might be easy in some places but then getting a bank account for the company is hard if you or some of other shareholders don't live there; then you still have nothing useful and a lot of paperwork to go.

That's completely irrelevant to the discussion. Creating a bank account as a non-resident is even in the US not that straight forward.

Let me guess, you're German? Germans will say they're not very patriotic, but really the way German patriotism manifests is a resistance to outside criticism paired with a stubborn insistence that it's worse in other countries.

Setting up a business in the UK is a breeze. It takes 30 minutes, costs 20 quid and it's all done online. I'd go so far as to say the UK is the friendliest place in the world for small businesses (as long as you don't have a physical location, because business rates are incredibly regressive and backwards)

A friend of mine in Iceland literally just set up a UK ltd company today - I'm a shareholder, took 5 minutes to verify my identity - by linking it to my existing companies house account.

Not EU though. But yes, easy, I had one there.

> nothing is fast here if you go the legal path and stay within the law

> and as you see everything costs a lot

this sounds like a system primed for corruption

if you can pay half the needed amount to do everything 5 times as fast, would you not do it?

But you can't. It's not like you can bribe the bureaucrat working on your form, and there is no regular fast pass.

> It's not like you can bribe the bureaucrat working on your form

are you trying to say "bureaucrat can't speed up" or are you doubting someone physically can't give someone else some cash?

The third option is “they could speed up but won’t do it for a bribe”.

As someone living in Germany, I would be very surprised if someone legit manages to bribe their way to skip a step somewhere. At an institutional level, perhaps it's more surprising if it never ever happens anywhere at all; but at an individual level, your particular case hitting a bribeable person and you knowing of it seems like worse odds than seeing a shooting star during a solar eclipse. Maybe if you are close family, or close enough plus a sob story, the person might have the ability to handle your case first; that sounds like something the computer system would allow in order to avoid getting stuck on a case they can't currently work on (for whatever reason) at the head of the queue. They're probably not the only step though so it might not help much

It literally can't be done, in Germany.

There is corruption in Germany, but it simply does not exist at this level. It also wouldn't work in practice: You would have to find out who is the office worker working on your documents (you usually don't know that, and never in advance). Then that person has safeguards: He is part of a team, someone will check his work, usually at least a colleague and his boss. Assume you'd try anyway, you meet the person somehow alone - how would you find out whether he is corruptible? If you try to ask you will face severe consequences.

Plus, it's never worth it for him: If they were caught they would be facing jail time, lose their job, all the benefits already earned (the special pension state servants get, their health insurance, ...). You'd have to offer that much money that all of that is worth it. Not even twenty times the money we are talking about here would be enough.

I never had any issue with Finanzamt being slow, they take my money with a proper disclosure ahead and also as quickly pay whatever I’m owed back

100% agreed! Reality is, many german businesses are just flying under the radar, as they simply dont want or cannot deal with all the tax crazyness and bureaucracy.

Doesn't Germany have Controled Foreign Company rules?

Yes , but cfc rules are mostly targeted against passive income and exclude active companies. They wouldn't matter in that case anyway as he would shift the tax residency to Germany by managing & controlling the company from Germany.

It's the scientific slash managerial state brought to you by Anglo-German leftist thinkers of the 19th century. Enjoy utopia.

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