Limited - balance sheet or income surplus calculation is also possible
November 9, 2010 | 30,00 EUR | answered by Bernhard Müller
Hello,
does a newly founded Ltd. (business operation in Germany) also have to keep its bookkeeping here, make a balance sheet at the end of the year, or can it also use an income-expenditure account and current taxation?
Thank you in advance!
Dear inquirer,
The obligation to prepare balance sheets arises from § 242 of the German Commercial Code (HGB). For corporations, this obligation is modified in § 264 HGB. Limited companies (Ltd) are also considered corporations, so you must prepare a balance sheet for the Ltd in any case.
However, according to § 274a HGB, there are size-dependent simplifications for the preparation of the balance sheet. These simplifications only make the preparation of the balance sheet easier but do not exempt from the obligation to prepare it. The definition of size classes can be found in § 267 HGB.
§ 274a HGB
Small corporations are exempt from the application of the following provisions:
1. § 268 (2) on the preparation of a fixed assets schedule,
2. § 268 (4) sentence 2 on the requirement to explain certain receivables in the notes,
3. § 268 (5) sentence 3 on the explanation of certain liabilities in the notes,
4. § 268 (6) on the deferred items according to § 250 (3),
5. § 274 on the deferral of deferred taxes.
§ 267 HGB
(1) Small corporations are those that do not exceed at least two of the following three characteristics:
1. €4,840,000 balance sheet total after deduction of a loss shown on the asset side (§ 268 (3)).
2. €9,680,000 sales revenue in the twelve months before the closing date.
3. An average of fifty employees per year.
(2) Medium-sized corporations are those that exceed at least two of the three characteristics mentioned in paragraph 1 and do not exceed at least two of the following three characteristics:
1. €19,250,000 balance sheet total after deduction of a loss shown on the asset side (§ 268 (3)).
2. €38,500,000 sales revenue in the twelve months before the closing date.
3. An average of two hundred and fifty employees per year.
(3) Large corporations are those that exceed at least two of the characteristics mentioned in paragraph 2. A corporation within the meaning of § 264d is always considered large.
(4) The legal consequences of the characteristics in paragraphs 1 to 3 sentence 1 only occur if they are exceeded or not exceeded on the closing dates of two consecutive financial years. In the case of conversion or establishment, the legal consequences occur as soon as the requirements of paragraph 1, 2 or 3 are met on the first closing date after the conversion or establishment.
(5) The average number of employees is calculated as one-fourth of the total of employees employed on March 31, June 30, September 30, and December 31, including employees working abroad but excluding those undergoing vocational training.
(6) Information and consultation rights of employee representatives under other laws remain unaffected.
Best regards,
Bernhard Müller, Attorney at Law
