Setting up a company in Germany as a US founder
Forming the company is the same as for any foreign founder. What’s genuinely different for an American is the immigration route — and it’s easier than most expect. Plus a US-tax dimension you’ll need a specialist for.
If you are a US citizen searching how to set up a company in Germany, most guides will walk you through the German formation steps — notary, capital, Handelsregister — which are essentially the same for everyone. Two things are actually specific to you as an American, and neither is the formation itself.
The first is good news: US citizens have a privileged immigration path into Germany that nationals of most countries do not. The second is a caution: owning a German company creates US tax-reporting obligations that have nothing to do with Germany and that you will need a US tax advisor for. This guide covers both, with the German formation mechanics themselves in the complete GmbH formation guide.
Can a US citizen open a company in Germany?
Yes — with no nationality restriction on ownership, and with a real advantage over most foreign founders when it comes to actually moving to Germany to run it.
On the company side, you are treated like any founder: a US citizen (or a US company) can own 100% of a German GmbH. Same notary, same €25,000 share capital for a GmbH (or €1 for a UG), same Handelsregister entry, same tax registration. You can attend the notary in person, or form the company from the US through a notarized, apostilled power of attorney.
Where being American specifically helps is the next layer — your right to live in Germany and run the business. Here US citizens are in a privileged group, and the route is markedly easier than for founders from, say, India or China.
Do I need a visa to move to Germany and run my company?
No visa beforehand. As a US citizen you can enter Germany visa-free and apply for the residence permit from inside Germany — you do not have to apply at a German embassy before you travel.
This is the central advantage, and it is worth being precise about because it is the opposite of how it works for most nationalities. Under § 41 of the German Residence Ordinance (AufenthV), nationals of a specific group of countries — the United States, along with Australia, Canada, Israel, Japan, South Korea, New Zealand, and the UK — may enter Germany visa-free even for a long-term stay, and apply for the required residence permit at the local immigration office (Ausländerbehörde) after arrival. You must file that application within 90 days of entering.
For most non-EU founders (an Indian national, for example) the rule is the reverse: they must apply for the residence visa at the German mission in their home country before travelling. As an American, you skip that step — you arrive, register your address (Anmeldung), and apply on the ground.
Two important limits, so this is not misread:
- You must not begin the business activity until the permit is approved. Visa-free entry lets you come and apply; it does not let you start operating before you have the title. (You can use a short visit to prepare a formation or investment — meetings, the notary, setting things up.)
- This is still a residence permit for self-employment. Being privileged on the procedure does not exempt you from the substance of qualifying, which is the § 21 route covered next.
What is the §21 self-employment permit, and do its conditions still apply?
Yes, the substantive conditions still apply: economic interest, positive economic effect, and secured financing, assessed with an opinion from the local Chamber of Commerce (IHK). But as a US national there is a second, treaty-based easing worth knowing about.
The residence permit for running your own business is granted under § 21 AufenthG. Its core conditions, assessed together, are:
- an economic interest or regional need for the business,
- expected positive effects on the economy, and
- financing secured through your own capital or a confirmed loan.
In practice the immigration office consults the IHK for an opinion, and the assessment looks at the viability of the business idea, your entrepreneurial experience, the capital involved, the employment effect, and any innovation. The centrepiece of the application is a substantive business plan (concept, revenue forecast, investment and capital-requirement plan). If you are over 45, adequate retirement provision generally comes into play. The permit is granted for up to three years, after which a permanent settlement permit (Niederlassungserlaubnis) becomes possible if the business has succeeded.
Now the part specific to Americans. Germany has friendship, trade, and establishment treaties — with most-favoured-nation or goodwill clauses — with a particular set of countries that includes the United States. For nationals of these states, the § 21 permit may be granted irrespective of the standard conditions in subsection 1. This is a discretionary decision by the immigration authority, not an automatic exemption — so it is best understood as a potential easing in how your case is weighed, not a guarantee or a way around the process. It is, however, a genuine advantage that founders from non-treaty countries do not have.
One more route worth naming: if running your own business is not essential and an employment-based path would suit you, § 19c AufenthG covers residence for qualified employment and can sometimes be more straightforward. Which door fits depends on your situation.
Can my US company open a German subsidiary?
Yes — a US company can wholly own a German GmbH, and that is a clean, standard structure. But the parent being American does not change your personal immigration position; that still depends on your own nationality.
This is a common and sound structure. A US corporation or LLC can be the sole shareholder of a German GmbH. For the notary, the US parent provides an apostilled certificate of good standing and a board resolution authorising the German formation. A full GmbH (rather than a UG) usually fits better here, because the narrative of an established US company expanding into Germany sits more credibly with it.
Keep the company and the person separate, though. If you are a US citizen, the §41 visa-free advantage and the treaty-based §21 easing above are yours regardless of the corporate structure — they attach to your nationality, not your company. And there is a strategic fork: if your goal is market presence rather than personally relocating, the US parent can own the German subsidiary and appoint a local managing director who already has the right to work in Germany, while you stay in the US and visit. Whether you pursue a residence permit for yourself or appoint a local director depends entirely on whether you intend to live in Germany.
What US tax obligations come with owning a German company?
Significant ones — and they are US obligations, not German. A US-owned German company triggers US reporting like GILTI, Form 5471, and FBAR. This is specialist US tax territory: engage a US international tax advisor early.
This is the one area where being American makes things more complex, not less — and it is important to be honest about its limits, including ours. As a US person, you are taxed on your worldwide income and you carry US reporting obligations on foreign companies and accounts that founders of other nationalities simply do not have. In broad terms, owning a German company can bring US filing requirements such as Form 5471 (reporting ownership of a foreign corporation), FBAR (reporting foreign financial accounts), and the GILTI rules, which can mean US tax exposure on the company’s profits even in years when nothing is distributed to you. German banks will also ask US persons to complete FATCA self-certification when opening the company account.
None of this prevents you forming a German company. But it is US tax law, it is genuinely complex, and it changes — so this is not something to navigate from a general guide, and not something we advise on. The right move is to engage a qualified US international tax advisor (alongside a German tax advisor) at the very start, before the company is running, so the structure is set up with the US side in mind. We flag it here precisely because the German-formation guides usually do not, and founders discover it too late.
Why set up in Hamburg specifically?
Hamburg is one of the more navigable entry points for an international founder — a major trade hub with a dedicated investment-promotion body — and competing for “[your nationality] + Hamburg” is far less crowded than for Germany as a whole.
Germany is a federation, and where you base the company determines which authorities handle your registration, tax, and IHK opinion. Hamburg is northern Germany’s trade and logistics centre, internationally oriented and used to cross-border business — which helps when your case is assessed for economic substance. Handelskammer Hamburg’s own guidance for foreign founders confirms the route described above, including that US nationals apply for the permit at the Ausländerbehörde after entry.
Hamburg also has a dedicated investment-promotion organisation whose job is to help international companies establish in the city — real support when you are navigating an unfamiliar system. Eren Consulting holds an official representative mandate covering exactly this region, so local access to the Hamburg ecosystem is something we can provide directly.
In short: the immigration path is easier, the US tax side is harder
For a US founder, the German company formation is routine, and the immigration route is genuinely favourable: visa-free entry, apply from inside Germany, and a possible treaty-based easing of the § 21 conditions on top of the standard route. The real complexity sits on the US side — GILTI, Form 5471, FBAR — which needs a US tax specialist from day one. Get the right advisors in place early, and the US-to-Germany move is one of the more straightforward ones.
Frequently asked questions
Can a US citizen own a company in Germany? Yes. There is no nationality restriction — a US citizen or a US company can own 100% of a German GmbH. The formation process is the same as for any founder.
Do US citizens need a visa to set up or run a company in Germany? Not before travelling. US citizens can enter Germany visa-free and, under § 41 AufenthV, apply for the residence permit from inside Germany within 90 days of entry — unlike most nationalities, who must apply at a German embassy beforehand. The business activity may not begin until the permit is approved.
Do the §21 conditions still apply to Americans? Yes. The substantive conditions (economic interest, positive economic effect, secured financing, with an IHK opinion) still apply. However, under the US-Germany friendship treaty, the permit may be granted irrespective of those standard conditions at the authority’s discretion — a potential easing, not an automatic exemption.
Can my US company open a German subsidiary? Yes — a US company can wholly own a German GmbH, using an apostilled certificate of good standing and a board resolution for the notary. The parent being American does not change your personal immigration position, which depends on your own nationality.
What US taxes apply if I own a German company? US reporting obligations such as Form 5471, FBAR, and the GILTI rules can apply, and German banks request FATCA self-certification. These are US obligations, separate from German tax, and they are complex — engage a US international tax advisor early. This guide does not provide US tax advice.
How long does the §21 permit last? Up to three years initially. If the business succeeds, a permanent settlement permit (Niederlassungserlaubnis) can follow.
Setting up in Germany as a US founder is two projects: a straightforward German formation with a genuinely favourable immigration route, and a US tax-compliance picture that needs a specialist from the start. If you want the § 21 route and the Hamburg setup mapped to your situation, book a confidential consultation — and for the formation mechanics, see the complete GmbH formation guide.