Cross border B2B payments to Germany

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Cross border B2B payments to Germany


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Forward Contract

Forward Contract

Forwards allow you to buy currency on an agreed future date at a pre-fixed rate. This may require a deposit and allows you to lock in a rate for up to two years.*

Spot Contract

Spot Contract

This is an agreement between you and your FX provider to buy currency at the present exchange rate, and it can be used for imminent payments.

FX Orders

FX Orders

If you need a particular exchange rate but have no urgency to purchase straight away, an FX order could help you secure a better deal.

FX Options

FX Options

Designed for foreign exchange rate management, options can be created as a bespoke solution for your business and its payment needs.**

Doing business in Germany can be both challenging and rewarding. This is what is to be expected, however, from a country with a highly developed, diversified economy; Germany’s economy is the largest in Europe and the fourth largest in the world. The strength of the Germany economy is underpinned by a highly skilled workforce, a rigorous legal system, world-class research and development, superb infrastructure and a healthy social climate. The economy is projected to grow by 1.8% in 2022, contract by 0.3% in 2023 and return to growth in 2024 at a rate of 1.5%; the country’s recovery is expected to be hampered by the war in Ukraine and the embargo on Russian oil.

These elements continue to attract investment from around the world. Whilst this is the case, the success of those ventures is often dependent upon a good understanding of the challenges inherent in doing business here. Among those challenges are the country’s intricate legal environment, tax system, and administrative procedures.

Familiarising oneself with the country’s bureaucratic requirements is vitally important. It will be necessary, for example, to understand the process involved in registering a new business with the local trade and tax office, the commercial register, the local chamber of commerce, and industry or professional organisations.

You would also be well-advised to familiarise yourself with Germany’s complex tax laws, as well as with the property registration procedure.

Guide to business in Germany for foreigners

What are the benefits of doing business in Germany?

As one might expected from a country that is famous for the strength of its economy, legal protections, education system, and infrastructure, there are many benefits of doing business in Germany. The country offers competitive tax regulations, a variety of incentives for business investment and a legal system that protect intellectual property.

The country is a hub of research and development: it ranks tenth among the 132 countries surveyed in the Global Innovation Index. Much of Germany’s success has stemmed from its ability to translate research into practical applications. Berlin has been ranked the second-best tech hub in Europe and the first choice for start-ups, surging ahead of London, with Dusseldorf also gaining in significance. The government supports research institutions and start-ups, and it licenses intellectual property to assist researchers’ careers.

Other benefits include access to the EU’s biggest consumer market, massive trade events, its geographic location at the centre of the EU, attractive investment incentives, and a robust start-up culture.

What are the major industries in Germany?

The country is well-known as an automotive manufacturer, but it also comprises a high concentration of businesses specialising in electrical and engineering equipment and textiles, in addition to pharmaceutical companies. Innovative areas such as robotics are balanced out by more traditional commodity-based industries such as steel, coal and iron, while industries such as aviation are drawn to the number of cutting-edge engineering companies and specialists.

When it comes to business opportunities in Germany for foreigners, the most interesting aspect of the commercial landscape is the high proportion of SMEs (named ‘mittelstand’) across a broad range of industries.

2/1/2021 4:31:49 PM

What are 'mittelstand' companies?

Mittelstand companies are equivalent to UK SMEs; the classification includes any company with less than 500 employees and therefore may relate to many expats starting a business here. One of the reasons that these companies are high profile in Germany is because there are many global leaders due to specialisation.

A sense of the scale and importance can be seen in the numbers – fewer than 30 of the 500 biggest companies across the globe are located in Germany, but 48% of small world market leaders in specialist markets are German in origin. This group of small and medium-sized enterprises form the backbone of the Germany economy.

If you have a unique proposition in a specialist or niche industry, Germany might just be the perfect place to foster that innovation and start expanding into markets across the globe.

2/3/2021 4:29:42 PM

What is the corporate tax rate in Germany?

The corporate tax rate for Germany is 15%, but business tax is made up of several component parts. A solidarity surcharge of 5.5% is levied in corporate income tax, and a municipal surcharge which ranges from 14% to 17% depending on the district. This brings the combined rate of tax roughly between 30% and 33%. This is levied on profits from business revenue, investments and the sale of assets.

If your company is based in Germany, the tax applies to worldwide profits. If you’re opening a German branch of your business, on the other hand, you are only liable for taxation on activities and profits relating to activities in Germany. It’s worth investing in a tax specialist in-country, because there are specific accounting rules that apply. One of the key points is that books must be kept on an accrual basis, and profits are calculated using the net worth comparison message, meaning that they are determined as the difference between net assets at the end of the previous year and net assets at the end of the current year. Capital contributions are tax-free, and withdrawals must be financed out of taxable income.

In many cases, the commercial and tax balance sheets are likely to be identical, but if there are any differences, companies are required to prepare both a commercial balance sheet (Handelsbilanz) and a tax balance sheet (Steuerbilanz) or an appendix added to a single balance sheet. When it comes to payments, companies must file their corporate taxes by the deadline on 31st May for the previous year with most paying quarterly on an advanced basis on 10 March, 10 June, 10 September and 10 December.

2/1/2021 4:32:05 PM

What are the challenges for businesses in Germany?

In some areas, red tape can pose a significant challenge when doing business in Germany. If you’re in the initial stages of starting a company and have purchased office space, allow roughly 40 days for the registration of property. You will require an extract from the Land Registry and a notarised transfer agreement to obtain a waiver of pre-emption rights, in addition to confirmation that transfer tax has been paid. Building permits and obtaining utilities can also be lengthy procedures, with the exception of gaining electricity; this takes just 17 days compared to the OECD average of 98 days.

Paying taxes in Germany is also a rather complicated process; there are nine tax payments that are taken each year, in addition to 14 different taxes. Germany’s employment laws are also some of the strictest in the world, and so it is important that you take the time to understand the regulations and know what your responsibilities are as an employer.

However, the advantages of doing business in Germany may outweigh the challenges when starting a business in this great nation: the streamlined financial sector makes it easy to obtain credit, work is underway to improve protections for investors and both contract enforcement and insolvency resolution are relatively efficient.

2/1/2021 4:33:35 PM

How to open a business in Germany?

Whether you’re starting a business in Germany or setting up an outpost of an existing company, you’ll need to register the business. This is a complex, time-consuming process.

The first step involved in register your business in Germany is to register your address (‘Anmeldung’). After you’ve completed this step, you’ll receive a registration certificate (Anmeldebestätigung), a tax ID (Steueridentifikationsnummer) and a VAT number (Umsatzsteuernummer).

It’s worth checking the specific classification of your work, as the German system differentiates between a Freiberufler (freelancer, including engineering, architecture, teaching and professional services) and a Gewerbetreibender, or tradesman. Working in a trade will require a trade license, and it means that you may be liable for trade tax and subject to different rules of taxation. It also includes a listing in the trade register. The certificate of registration is needed to open a bank account, which is itself a requirement for registration with the Finanzamt, or tax office.

2/1/2021 4:34:49 PM

Business etiquette in Germany

Correct business etiquette is taken very seriously across Germany and is something with which you should become familiar when branching out into the German market.

As anyone who has spent any length of time in Germany, punctuality is of the utmost importance amongst Germans. Delivering the work that you have agreed to do is also of the utmost importance.

There are a number of nuances in the German language that you’ll need to understand. If you are conversing in German, it’s necessary to know the difference between the formal ‘you’ (Sie) and the informal ‘you’ (du) direct speech. Although it depends greatly on the type of business or workplace you are in, a formal dress code is typically adhered to, and greetings are always made with a handshake and eye contact.

2/3/2021 4:25:24 PM

How to pay a business invoice via money transfer to Germany

Whether you are transferring funds to a German supplier or sole trader, you can make ad hoc payments for overseas invoices via your online moneycorp business account. From here you can also buy currency, make payments and set up users and approval workflows for your payment needs. Read our full guide on how to pay an international invoice for more information.

2/3/2021 4:37:57 PM

How to pay your German-based staff via global payments

Our global payments solutions are designed to address the mass payment needs of our clients, automatically selecting the most competitive available rate from our pool of 18+ liquidity providers for your payment.

No matter if it's a workforce of 10 or 1000 employees, our global payments service ensures that your employees are paid on time, with access to a wide range of currencies. As well as helping you to pay German-based employees, our solutions can also be ideal to cover other operating costs of yours.

2/3/2021 4:45:23 PM

What are the biggest opportunities for doing business in Germany?

For those considering doing business in Germany, there are several opportunities to be seized in this dynamic economy.

Germany’s consumer market is the largest in the European Union, with a population of 83.2m. Easily the most significant European market for foreign producers, Germany is the third-largest importer, after the United States and China, and thus offers myriad opportunities for those looking to sell their goods and services to companies operating within it. Its main imports are machinery including computers, electrical machinery and equipment, vehicles, mineral fuels and pharmaceuticals.

Germany is also very well-connected: it borders nine countries, and its transport infrastructure connects it to every region on the planet, with Frankfurt airport alone offering more than 300 destinations.

Germany’s education system is one of the best in the world, and its culture of innovation and commitment to nurturing research and development make it the ideal location to connect with Europe’s best and brightest

Doing business in Germany with Moneycorp


Moneycorp offers global payment solutions for your business needs and extensive options to protect your money from exchange rate movements. Send money to and from Germany with ease through our international payment service.

Sign up for a business account with Moneycorp today.

FX Solutions

FX Solutions

Our team will work with you to identify your requirements and offer a range of products including Spot Contracts, FX Orders and Forward Contracts to meet your needs.



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Get in touch & learn more about how we can send money to and from Germany

Get in touch & learn more about how we can send money to and from Germany

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*Forward Contracts may or may not require a deposit dependent upon your facility agreement.
**Our team of experienced currency risk management specialists are approved by the FCA for investment business. Following an initial assessment of your risk-appetite and investment objectives they can formulate and illustrate a bespoke solution for you to consider. Please note that Option related products are regulated investment products which can carry a higher level of risk than Forward Contracts.