Entrepreneur Franz Gruber from Vorarlberg (Austria) is a manufacturer of packaging solutions.
He has been offering these solutions in the German market for some time. While attending a trade fair, he discovers that some of his competitors, who have already set up distribution companies in Germany, are growing much faster in terms of sales revenues. To strengthen his presence in Germany, Mr. Gruber now intends to establish a distribution company in this country.
Following a short internet research and an inquiry submitted to the Austrian trade delegation in Munich, he finds interfides Steuerberatungsgesellschaft mbH. A meeting is arranged.
At a first consultation meeting at our Munich head office, which Gruber’s CFO in Austria joins via video conference, we discuss the following issues:
After some consideration, Mr. Gruber decides to establish a distribution company in the form of a GmbH (company with limited liability) in Germany. In this context, we offer the following support services, which are provided in cooperation with interfides Huber-Sierk Rechtsanwaltsgesellschaft mbH:
- Arranging a meeting with the notary
- Preparation of articles of association
- Registration in the trade register
- Preparation of employment contracts
- Applying for a VAT number
- Opening balance sheet
- Preparation of Managing Director Service Agreements
Now that all formalities have been concluded, business operations can commence. Mr. Gruber quickly discovers that his distribution company domiciled in Grünwald near Munich enjoys a higher level of trust among customers. There is significant growth in sales revenues.
At the same time, administrative requirements have also increased. This is where our strength in managing monthly accounting activities comes in. Besides normal tasks such as account assignment and the analysis of receipts, along with preliminary VAT returns, we also create a reporting system that is aligned to the needs of the corporation. This system
- includes the KPIs of the Austrian parent
- considers intercompany transactions
- can be integrated into overall corporate planning
The business is doing very well – so well in fact that the company’s sales volume exceeds five million euros, which is an important threshold for the tax office. It means that the German distribution company is now required to prepare transfer price documentation. We prepare this documentation in cooperation with the law firm interfides Huber-Sierk Rechtsanwaltsgesellschaft mbH, and ensure that it fulfils the following requirements of sec. 4 GAufzV (German Transfer Pricing Records Regulation):
- Shareholdings, business operations, organisational structure
- Business relations with related parties
- Functional and risk analysis
- Transfer price analysis
After a few years of solid business growth, Mr. Gruber receives a letter from the tax office, which notifies him that his business has been selected for a special VAT audit due to the high trading volume with Austria. In that case, we assist Mr. Gruber’s company in two ways: