[jillesvangurp]

Exactly, you need to get proper advice on how to structure your business in Germany. Basically, putting your shares in holding companies is both common and not dodgy. Corporate taxes are more friendly than personal income taxes. You can do constructions with salaries, dividend, etc.

Doing this is standard practice if you are founding a company. You need to plan for your startup to be actually successful and being on the receiving end of a big exit. You can't just wing it and hope for the best.

Germany has a large amount of wealthy small investors, business owners, family owned businesses, etc. And many of those might retire in places like Spain, Italy, etc. There are ways. You just need to understand the system.

That's not to say that Germany is not a huge PITA when it comes to managing all these constructions, dealing with the bureaucracy, and the maze of silly government agencies that refuse to share even the most basic information with each other so you are stuck in ground hog day providing the same information over and over again (who are you, where do you live, what is your company registration, etc.). But once you know the how this backwards and dysfunctional system works, you can get it to work for you. Because painful as it is, the system does work more or less as advertised. But you do need to familiarize yourself.

BTW. this is a topic where LLMs can be helpful. You can skip a lot of the traditional advisers and other middle men, if you are a bit smart on that front. Using an accountant is actually worth the money for liability reasons. So don't skimp on that. But otherwise, knowing what you are getting into in terms of bureaucratic process can save a lot of time.

[jacquesm]

> this is a topic where LLMs can be helpful.

That's probably the very last spot where you want to use an LLM, especially not in Germany. One single mistake can cost you a fortune, and you won't be able to spot the mistake because you're not an expert. LLMs could be used to prime you for conversations with an expert (but be prepared to be corrected on points of law and fact) but they are no substitute. Corporate law is a legal minefield, tread with utmost care.

The whole proposition is in a way bizarre: if you have this problem you almost certainly can afford proper guidance and if you need to resort to an LLM for that guidance you almost certainly don't need such complex constructs in the first place!

[graemep]

I would say not with tax law anywhere. It is very complex and has all sorts of interactions between things - e.g. double tax treaties.

That said, a lot more people would probably use complex constructs if they were not so expensive to set up because of the advice needed. I just do not think LLMs help.

[StopDisinfo910]

RAG are quite good with tax codes. That’s not particularly surprising you have documents telling you exactly what can be done and what is hard is knowing everything inside and putting everything together. That’s pretty much exactly in the sweet spot for LLM queries.

[throw9349494]

Crazy theory: most posts here are from German Tax office. They give a "free" advice, and send a fat tax penalty 5 years latter! Suprise: you never left!

[jacquesm]

If the German tax office is actually using HN for such schemes I'd have to give them more credit for using technology effectively than I currently do. It would be funny if they did though.

[eqvinox]

If you move back to Germany within 7 years, you actually don't have to pay the tax, so this would be a pretty poor use of their time :P

[jacquesm]

That's a point for that theory, not against ;)

[lenerdenator]

Who's the German equivalent of the American Certified Public Accountant?

Those shouldn't be prohibitively expensive; even small businesses in the US can typically afford one. Just go ask them.

[reaperducer]

Those shouldn't be prohibitively expensive; even small businesses in the US can typically afford one.

Having an accountant is one of the hallmarks of a legitimate business.

If you're doing it on your own without a professional to watch out for you, and advise you, and take care of the details so you can do more important things, it isn't a company, it's a hobby.

[bluGill]

Even hobbies are sometimes better done with an accountant. if you sell your garden surplus at a farmers market for example. They are not expensive if you only need a little help and can save a lot of trouble.

[lenerdenator]

"That's just moving fast and breaking things and disrupting industries." - someone in SV right now reading this, probably.

[jillesvangurp]

I'm not saying use it blindly. But it helps going into discussions with experts, advisers, etc. with some preparation and knowledge. Worst case you are wrong and they'll correct you and best case you pre-empt some actual problems. And it's not like advisers, accountants, etc. don't make mistakes, overlook stuff, or sometimes work against your interests. It helps being a bit hands on. And LLMs make that a lot easier.

Also LLMs are great for picking apart complex bureaucratic procedures, figuring out what next needs to be done, what the meaning is of some 10 page pile of crap the tax office dumped in your mail box, etc. Especially if you are not a native German speaker. You can ask your critical questions, get it to explain stuff you don't understand, etc. In the end, you are responsible for your actions. Limited liability in Germany isn't that limited. So, spending some time on figuring out whether you are doing it right is hard work. LLMs help.

But yeah, don't vibe run your private finances and sources of income.

[freyfogle]

C'mon Jilles, as we say in Germany "no risk, no fun"

[mschuster91]

> That's not to say that Germany is not a huge PITA when it comes to managing all these constructions, dealing with the bureaucracy, and the maze of silly government agencies that refuse to share even the most basic information with each other so you are stuck in ground hog day providing the same information over and over again (who are you, where do you live, what is your company registration, etc.).

That's where you hire a professional accountant. Which you should be doing anyway at the point where you raise any sort of external funding that's not family members.

I don't get why people are always complaining about German taxes. As long as you're small, you can just wing it. And when you pass the threshold, professionals are cheap.

[jillesvangurp]

I'm not complaining about the taxes but the bureaucracy. And the taxes definitely require an accountant here because of the complexity of the tax law and all the intentional loopholes in there for people that can afford an accountant. Accountant lobbies are fierce in this country and they like being necessary. So a lot of sane things that other countries are doing to keep things simple haven't really happened here. I never lived in the US but from what I know of it, it's actually one of the countries that is worse on this front. So, if you move here from there, it might be an upgrade.

Anyway, I call the German attitude to this topic Stockholm syndrome. The thing is, I've lived in four countries in the EU so I know how things can be different, more efficient, etc. When I say Germany is a PITA, that is relative to the Netherlands, Sweden, and Finland and based on my experience with those countries. Which isn't even that recent. Those countries were miles ahead of how things are in Germany today decades ago. And I wouldn't exactly refer to Finland and Sweden as tax havens.

Taxes are quite high here. Fun fact: when I moved to Germany from Finland, it was an internal transfer for Nokia. My salary was compensated up because of the higher tax and insurance cost in Germany. From Finland! Of course, the cost of living is quite a bit lower here. So this was a nice thing for me. But it's not a cheap country.