Foreign-Owned GmbH
German subsidiary financial statements: your local HGB obligation
If your group owns a German GmbH, UG or GmbH & Co. KG, that entity has its own statutory duty to prepare and file German annual accounts under the Handelsgesetzbuch (HGB). This page explains what the subsidiary must produce, when, and why the parent's own accounts do not discharge the obligation.
The obligation sits on the German entity, not the parent
A German subsidiary is a German merchant (Kaufmann) in its own right. From incorporation it must keep double-entry books (§ 238 HGB) and, at each financial year-end, prepare a full set of statutory annual financial statements — the Jahresabschluss — under §§ 242 and 264 HGB. This duty is entirely independent of the parent's nationality or accounting framework.
The parent's consolidated accounts, filed in the US, UK or elsewhere, do not satisfy the German subsidiary's local filing duty. The German company still has to prepare its own single-entity statements in German and euros (§ 244 HGB) and file them with the Unternehmensregister within 12 months of the balance sheet date (§ 325 HGB). A foreign parent simply receives those numbers as a reporting package for its own consolidation.
What your German subsidiary must produce
The components scale with the entity's size class.
Bilanz (balance sheet)
The balance sheet in the fixed structure of § 266 HGB. Every corporation prepares one; smaller size classes may present it in an abbreviated form.
GuV (income statement)
The profit-and-loss account under § 275 HGB, using either the nature-of-expense (Gesamtkostenverfahren) or cost-of-sales (Umsatzkostenverfahren) format.
Anhang (notes)
Notes under §§ 284–288 HGB explaining accounting policies and required disclosures. Micro entities may omit the Anhang if they show a few figures beneath the balance sheet (§ 264 Abs. 1 Satz 5).
Lagebericht (management report)
A management report under § 289 HGB — required only for medium and large corporations. Small and micro subsidiaries are exempt (§ 264 Abs. 1 Satz 4).
Size class sets the workload
The scope of the statements — abbreviation, disclosures, audit and what is published — depends on the subsidiary's size class under § 267 / § 267a HGB. You fall into a class by staying under two of the three criteria on two consecutive balance sheet dates: micro (≤ €450,000 balance sheet total, ≤ €900,000 revenue, ≤ 10 employees), small (≤ €7.5m / ≤ €15m / ≤ 50), medium (≤ €25m / ≤ €50m / ≤ 250), or large above that.
A common trap for foreign groups: a subsidiary can look small operationally but breach the balance sheet total threshold because of intercompany loans or a large participation. Classification is mechanical, not about how the parent perceives the entity, so it is worth checking every year.
Deadlines, audit and filing
- Preparation: within 3 months of year-end for medium and large entities, within 6 months for small and micro (§ 264 Abs. 1 HGB).
- Adoption: GmbH shareholders formally adopt the statements — small GmbHs within 11 months, others within 8 months of year-end (§ 42a GmbHG).
- Audit: only medium and large corporations require a Wirtschaftsprüfer audit (§ 316 HGB); small and micro do not.
- Filing: submit to the Unternehmensregister within 12 months of the balance sheet date (§ 325 HGB); what is published shrinks with smaller size classes.
- Penalties: the Bundesamt für Justiz opens automatic proceedings for late filing, with fines from €2,500 that repeat until you comply (§ 335 HGB).
How the parent's group accounting fits in
Preparing the German statutory set and feeding the group consolidation are two separate exercises. The subsidiary produces its stand-alone HGB numbers; the parent then maps and consolidates them under its own framework (US GAAP, IFRS, FRS 102). jahresabschluss.io prepares the single-entity German statements — it does not produce the group's consolidated accounts.
In practice you keep one German statutory truth in HGB and derive a reporting package from it. That keeps the local filing clean and gives the group finance team a reliable starting point for its own consolidation adjustments and intercompany eliminations.
Preparing the statutory set with AI software
You can register for free, upload the subsidiary's trial balance (Saldenliste) and see an AI-generated Bilanz and GuV in minutes, with the Anhang drafted from your figures and answers to a short questionnaire. The filed original is always the German document; an English convenience translation is available so the group can read what was filed.
For a micro or small subsidiary — where no audit is required — this is often all the finance team needs to meet the German obligation without standing up a full local accounting function.
Frequently asked questions
Does a foreign-owned German GmbH have to file German accounts?
Yes. Every German corporation files its own statutory annual accounts under §§ 242 and 264 HGB and discloses them via the Unternehmensregister (§ 325 HGB), regardless of the parent's country or the group's accounting framework.
Can we use the parent's consolidated accounts instead?
No. The parent's consolidated statements do not discharge the German subsidiary's local duty. The subsidiary must prepare its own single-entity HGB statements in German and euros; those numbers can then feed the parent's consolidation as a reporting package.
What if the German subsidiary is dormant?
A dormant company still has to prepare and file annual accounts. Inactivity does not remove the § 325 HGB disclosure duty, and the Bundesamt für Justiz issues late-filing penalties to dormant companies too.
Which language must the statements be in?
German and euros (§ 244 HGB). Any English version is a convenience translation only; the German document is the legally binding one that is prepared, adopted and filed.
Does the subsidiary need an audit?
Only if it is medium or large under § 267 HGB. Small and micro subsidiaries are not subject to a statutory audit (§ 316 HGB), which is why many foreign-owned German entities can prepare their statements without a Wirtschaftsprüfer.