How are companies classified in Germany?
Company categories – Businesses in Germany
Company classification in Germany
In Germany, companies are classified based on their size according to the German Commercial Code (HGB). This classification is particularly important for businesses planning to establish themselves in Germany, as it determines their accounting and financial reporting obligations.
The HGB defines four company categories:
- Micro-enterprises (Kleinstgesellschaften)
- Small enterprises (Kleingesellschaften)
- Medium-sized enterprises (Mittelgroße Gesellschaften)
- Large enterprises (Großgesellschaften)
A company’s classification is based on three criteria:
- Total assets (balance sheet total)
- Revenue (last 12 months)
- Average number of employees
To belong to a category, a company must not exceed more than two of the three following thresholds for two consecutive financial years:
| Category | Balance Sheet Total | Revenue | Average Employees |
| Micro | ≤ 450,000 € | ≤ 900,000 € | ≤ 10 |
| Small | ≤ 7,500,000 € | ≤ 15,000,000 € | ≤ 50 |
| Medium | ≤ 25,000,000 € | ≤ 50,000,000 € | ≤ 250 |
| Large | > 25,000,000 € | > 50,000,000 € | > 250 |
Accounting and disclosure obligations
Depending on company size, different requirements apply:
- Micro-enterprises: Simplified balance sheet, reduced disclosure obligations.
- Small enterprises: Must publish the balance sheet and notes, but not the profit and loss statement.
- Medium-sized enterprises: More detailed notes, audit requirement.
- Large enterprises: Full disclosure of balance sheet, profit and loss statement, management report, and mandatory audit.
Publicly listed companies, banks, and insurance firms are always classified as large enterprises, regardless of their actual size.
If you have further questions, our accountants will be happy to provide you with personal advisory. Additionally, we are available to advise you throughout France and Germany by phone and video conference. Your Franco-German tax consultancy FRADECO.
Disclaimer
Although the greatest possible care has been taken in the preparation of this newsletter, we reserve the right to make changes, errors, and omissions. The abstract legal presentation in this newsletter is no substitute for individual civil and tax law advice on a case-by-case basis. Subsequent changes to the legal framework, the views of the German or French tax authorities or case law, including with retrospective effect, are possible.
