[matt4077]

There have always been options to start without capital requirements, usually at the price of personal liability. The idea is that you need a bit of "skin in the game" to protect vendors.

If you're in something like software and have no immediate plans for employees or large investments you can get the bureaucracy done in 30 min. It's literally a one-page form with address, name, purpose.

[matt_o]

Well, my "self-employement" form was actually 8 pages long and it featured a lot more items than address, name, purpose and processing it took about 4 weeks. To be fair, I could start my business as soon as I sent that out, but I could not invoice clients until I got the reply, which included my new tax number. This is how it works in Germany. Add on top of that the mandatory monthly VAT tax reporting.

That is a significantly higher cost of entry when compared with an Ltd/LLC, not to mention a sole proprietorship.

[matt4077]

Here's the sole proprietorship form, it's actually one page: http://www.hamburg.de/Dibis/form/pdf/Formular-Gewerbeanmeldu... – but obviously it depends a lot on the individual circumstances (like the tax ID you need for cross-border transactions). VAT is annoying, but it's only monthly if you're above 120000 Euro or so. We've started only filling in our revenue (which I can get within a few seconds) and file the tax we paid to suppliers with the yearly declaration. It's much faster to do it all in one go.

[matt_o]

I had to fill out this form: "Fragebogen zur steuerlichen Erfassung" and I have to report my VAT using the Elster system monthly, even though my VAT is always 0 (my clients are all outside of the EU).

I went this way after consulting some other folks in Berlin and a tax consultant that I found myself. I'm kind of surprised that there's a different, easier way to go. Thanks for sharing the information.