throwawayheyhey

No, you're the one peddling misinformation here. It's true that you have to tell German authorities about your foreign business (not just your income from that business) for tax purposes if you're actually operating your business from within Germany (i.e. you're running a "Gewerbe"). There are also some rules to follow you're merely conducting business with German customers, i.e. how to collect VAT etc.

In any case, however, you certainly don't have to "convert" your business into a GmbH.

Well, if OP is making so much that he can easily afford spending 3k/year on a tax consultant and still be left with a considerable amount (say 2-3 times this amount), then I'd say he's already ramen-profitable. ;)

In Germany, you don't need a separate legal entity for that. The legal entity is you, as a person. (Also called Gesellschaft bürgerlichen Rechts, GbR, or Einzelkaufmann, depending on the details.)

> It doesn't matter if you already have a full time job or not.

It does, assuming he's going to have his company pay himself a salary. (Otherwise he'd need to wait for the yearly dividend.) In case of a salary, he'd have to

1) pay for social security and so on and make arrangements with his employer (basically, to decide who pays how much).

2) again, make arrangements with his employer because of the non-compete rule. It doesn't actually matter whether it's mentioned anywhere in the contract, as it's the law. (I forgot the exact article but it's somewhere in BGB.)

As a German, I would strongly advise against incorporating too early (at least in Germany). I once made the mistake of founding a UG for a small side project and had to realize at some point that all the required bureaucracy was keeping me from doing the actual work. Let me break down the work for you because I hadn't been fully aware of what was awaiting me:

- double-entry bookkeeping: This is easier than it sounds because there're lots and lots of rules. I mean, even though I had learned this stuff in school for a bit and my mom actually used to teach bookkeeping, it was still hard. An Excel sheet won't cut it! (In fact, Excel is not allowed anymore as it can be manipulated after the fact, so you'll need actual bookkeeping software.) Sure, you could hire a bookkeeper but then you'd be spending even more (see below).

- Umsatzsteuer-Voranmeldung: monthly, for the first two years

- Umsatzsteuererklärung, Körperschaftsteuererklärung, Gewerbesteuererklärung, Handelsbilanz, Steuerbilanz/E-Bilanz: 6 months after the end of a fiscal year (usually May 31). Make no mistake, this is tons of work.

And then there're the costs:

- Founding: at least ~300€

- Mandatory IHK membership fee: ~160€/year

- Business bank account: at least 10€/month

- Bookkeeping software: at least 15€/month (unless you want to use pen & paper)

- Sending E-Bilanz & Handelsbilanz electronically to the tax authorities & the Handelsregister: ~50€/year

So yeah, unless your ramen-profitable as people call it, I'd say: Don't do it [in Germany]!