Micro-Entity

Micro-entities are a special form of small corporations defined under § 267a HGB, introduced by the MicroBilG to relieve micro-GmbHs and similar legal forms administratively. The requirements are that at two consecutive balance sheet dates, the balance sheet total does not exceed €350,000, net revenue does not exceed €700,000, and the number of employees does not exceed ten. If any of these thresholds are exceeded, the company loses its status. The key feature is comprehensive disclosure simplifications: instead of a full balance sheet and profit and loss account, a significantly shortened balance sheet suffices, which is only filed with the Federal Gazette. The filed, unpublished balance sheet can only be accessed by creditors or business partners upon explicit request, thus protecting sensitive company figures from public disclosure. This regulation reduces costs, simplifies the annual financial statement, and enhances the competitiveness of very small businesses. For tax advisors, entrepreneurs, and founders, precise knowledge of the revenue limit, balance sheet total, and number of employees is essential to optimally leverage the benefits of a micro-entity.