Who Must Keep Books — Kaufmann Status and HGB §238
The obligation to keep double-entry bookkeeping (doppelte Buchführung) arises from Kaufmann status under HGB §1. Every GmbH, AG, and UG is legally a Kaufmann by virtue of its legal form, irrespective of actual trading activity or turnover level.
| Merchant Type | Category | Bookkeeping Required? |
|---|---|---|
| GmbH, AG, UG | Formkaufmann (legal form merchant) | Always — regardless of size or activity |
| Einzelkaufmann (turnover >€600K or assets >€60K) | Istkaufmann | Yes — double-entry under HGB §238 |
| Einzelkaufmann (small, below threshold) | Kannkaufmann | Optional EÜR (simple cash accounting) |
| Freiberufler (liberal professions) | Not a Kaufmann | EÜR (Einnahmenüberschussrechnung) only |
| GbR (civil law partnership) | Not a Kaufmann unless commercial scale | EÜR unless commercial scale triggers HGB |
HGB Size Classifications — Annual Accounts Obligations
The scope of annual accounts obligations and audit requirements depends on the company's size under HGB §267. Classification is based on two of three criteria (total assets, revenue, employees) being met in two successive years.
| Size Class | Total Assets | Revenue | Employees | Key Obligations |
|---|---|---|---|---|
| Kleinstkapitalgesellschaft | ≤ €350,000 | ≤ €700,000 | ≤ 10 | Simplified balance sheet only; no notes required for Bundesanzeiger |
| Klein (Small) | ≤ €6M | ≤ €12M | ≤ 50 | Abbreviated balance sheet; abridged notes; no management report; no audit |
| Mittelgroß (Medium) | ≤ €20M | ≤ €40M | ≤ 250 | Full accounts; management report (Lagebericht); voluntary audit |
| Groß (Large) | > €20M | > €40M | > 250 | Full HGB accounts; mandatory Lagebericht; mandatory statutory audit |
GoBD — Digital Accounting Compliance Rules
The GoBD (Grundsätze zur ordnungsmäßigen Führung und Aufbewahrung von Büchern, Aufzeichnungen und Unterlagen in elektronischer Form) are the BMF's binding requirements for digital accounting records. All electronic accounting systems used by German companies must be GoBD-compliant. Key requirements:
| Requirement | Practical Meaning |
|---|---|
| Nachvollziehbarkeit | Every entry must be traceable from original document through to the financial statement |
| Unveränderbarkeit | Once posted, entries must be immutable — no silent overwriting permitted |
| Vollständigkeit | All transactions must be recorded completely, without gaps |
| Aufbewahrungsfrist | Commercial records retained 10 years; business correspondence 6 years (AO §147) |
| Zeitgerechtheit | Transactions must be recorded promptly — ideally within 10 working days of occurrence |
Popular accounting tools used by German GmbHs include DATEV (market leader, recommended by Steuerberater), Lexware, and sevDesk (cloud-based, SME-focused). Xero and QuickBooks can be used but may require GoBD certification add-ons. Always confirm GoBD compliance status with your Steuerberater before deployment.
Bundesanzeiger Publication Requirements
All GmbHs must publish (offenlegen) annual accounts in the Bundesanzeiger within 12 months of financial year end, via the online portal at publikationsplattform.bundesanzeiger.de. Late publication triggers enforcement proceedings by the Bundesamt für Justiz (BfJ): fines start at €2,500 under HGB §335.
- Annual accounts preparation deadline: within 3 months of year end (§264 HGB); small companies have 6 months
- Shareholder approval required before publication
- Kleinstkapitalgesellschaften may file a simplified abbreviated balance sheet only
- Electronic submission via publikationsplattform.bundesanzeiger.de
- Non-compliance: BfJ initiates enforcement ex officio — fines from €2,500 up to €25,000
German Accounting Standards — Overview
HGB
German Commercial Code (all companies)
Handelsgesetzbuch — mandatory basis for German statutory accounts
IFRS
Required for listed companies
EU-listed groups must consolidate under IFRS since 2005
12 mo
Filing deadline
Annual accounts must be filed at Bundesanzeiger within 12 months of year-end
0
Min. audit-free period
Small GmbH below two of three size thresholds — no statutory audit
Frequently Asked Questions
Does a German GmbH use HGB or IFRS accounting?
German GmbHs use HGB (Handelsgesetzbuch — German Commercial Code) accounting standards by default. IFRS is mandatory only for consolidated accounts of publicly listed companies. HGB follows the prudence principle (Vorsichtsprinzip) and is more conservative than IFRS.
What is GoBD compliance and why does it matter?
GoBD are the BMF's binding rules for digital accounting records in Germany. They require that all entries be traceable, immutable, complete, and retained for 10 years. Non-compliant accounting systems can result in Finanzamt estimates of taxable income during a tax audit.
When must a German GmbH have its accounts audited?
A statutory audit is mandatory only for large GmbHs (two of three criteria: total assets >€20M, revenue >€40M, >250 employees). Small and medium GmbHs are not required to have a statutory audit but may choose one voluntarily for banking or investor purposes.
What is the deadline for publishing annual accounts in Germany?
German GmbHs must publish annual accounts in the Bundesanzeiger within 12 months of the financial year end. Preparation must be completed within 3 months (6 months for small companies). Late publication triggers automatic enforcement by the Bundesamt für Justiz with fines starting at €2,500.
Can a German GmbH use a 30 June financial year end instead of 31 December?
Yes. The financial year (Wirtschaftsjahr) does not have to end on 31 December. Any 12-month period is permitted, subject to Finanzamt notification via the Fragebogen zur steuerlichen Erfassung. A non-December year end can be used for group reporting alignment or to avoid peak season for Steuerberater.
What is the Maßgeblichkeitsprinzip in German accounting?
The Maßgeblichkeitsprinzip (authoritative principle) means the HGB commercial balance sheet is the basis for the tax balance sheet. Assets and liabilities recognised in the commercial accounts must also appear in the tax accounts unless specific tax rules require different treatment. This linkage simplifies reporting but requires careful management of timing differences.
What records must a German GmbH retain and for how long?
Under HGB §257, commercial books, inventories, opening balances, annual accounts, management reports, and booking documents must be retained for 10 years. Business letters (received and copies sent) must be kept for 6 years. The 10-year period starts at the end of the calendar year in which the document was created. GoBD requires retention in machine-readable format.
What is the difference between Einnahmen-Überschuss-Rechnung and Bilanzierung?
Einnahmen-Überschuss-Rechnung (EÜR) is a simplified cash-based profit and loss statement available to sole traders and freelancers with revenue below €600,000 or profit below €60,000. GmbHs must always use Bilanzierung — full double-entry bookkeeping with a balance sheet and P&L under HGB. There is no size threshold that allows a GmbH to use EÜR.
When is a management report (Lagebericht) required for a German GmbH?
A Lagebericht is mandatory for large and medium-sized GmbHs under HGB §289. It must describe the business's current position, expected development, and principal risks. Small GmbHs (two of three: assets ≤€7.5M, revenue ≤€15M, ≤50 employees) are exempt. Groups above certain thresholds must also publish a non-financial statement (Nachhaltigkeitsbericht) under the EU CSRD from 2025.
How does German accounting treat provisions (Rückstellungen)?
Under HGB, provisions for uncertain liabilities and anticipated losses must be recognised when there is a present obligation and an outflow is probable — even without a specific counterparty claim. This includes provisions for pending tax audits, employee jubilee payments, warranty obligations, and environmental clean-up. IFRS requires stricter certainty thresholds; HGB provisions are generally broader and more conservative.
Need professional help?
Goldblum und Partner AG — licensed German Rechtsanwälte in Düsseldorf since 2007.
Free ConsultationWork with the firm that knows Germany.
Licensed Rechtsanwälte and Steuerberater in Düsseldorf. Free 30-minute consultation, no commitment.
Book Free Consultation