What does gGmbH mean?

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Often medium-sized companies with a social background operate under the company name gGmbH. This is a special form of the GmbH with no intention to make a profit. For the company this means: low or nonexistent tax burden.

Non-profit GmbHs help other people.
Non-profit GmbHs help other people.

Non-profit company means tax benefits

  • The gGmbH stands for "non-profit company with limited liability". It is therefore not a classic GmbH with the intention of making a profit.
  • Instead, the focus is on the social aspect (e.g. promotion, further training or support for people) of the company. Since social and monetary goals usually contradict each other, the addition of the "g" in front of the well-known abbreviation for GmbH separates the two forms from each other.
  • According to the law, both variants are the same type of company. That means: Both GmbH and the non-profit form are subject to the GmbH Act and the regulations of the Commercial Code.
  • The gGmbH brings advantages above all in terms of tax law, as due to the low or hardly any profit of the company, only a small tax burden is incurred, provided that the charitable purpose is stipulated in the articles of association. In addition, donations and other contributions from companies and donors can be easily deducted from taxes.

Examples of applications for limited liability companies

  • Unlike an association, a gGmbH is able to generate profit. As a result, non-profit organizations in this form enjoy great popularity wherever this process is necessary. For example, a court ruling in 2012 ensured that clubs had no kindergartens and Day care centers are allowed to maintain more, since according to the judge it is an entrepreneurial activity act. With a company name as a GmbH, this can be avoided without having to fear tax disadvantages.
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  • For this reason, many private educational institutions, such as private (technical) universities, are also registered as non-profit.
  • In addition, many companies that offer social support (e.g. B. Reintegration into the Working life or workshops for the disabled), also run as a GmbH, which means that they can be entrepreneurial and socially active at the same time. (As of 06/2013)

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