Meaning of GmbH & Co. KG

The GmbH & Co. KG, i.e. the limited liability company & Compagnie Kommanditgesellschaft , is a special form of the classic limited partnership (KG). It is a partnership , but your liability risk is limited to the capital contribution of the GmbH.

Definition GmbH & Co. KG

The GmbH & Co. KG combines two completely different legal forms – namely that of a GmbH with that of a limited partnership . It thus consists of a GmbH and at least one natural person . As a result, from a legal point of view, this does not result in a corporation, but a partnership. Typically, trading companies choose the legal form of GmbH & Co. KG, in which the liability risk of the shareholders is to be limited accordingly. It is also often found in companies that serve asset management. So far, the legal form is only permitted in Germany and Austria. In Switzerland, however, not.

Foundation and further characteristics of a GmbH & Co. KG

In order for you to be able to set up a GmbH & Co. KG, you need at least two people. Namely a personally liable partner and a partner . In the first step you have to set up the GmbH and have it entered in the commercial register. It can consist of one or more partners. Are absolutely necessary for a notarised articles of association and articles of association . The share capital of the GmbH must be at least 25,000 euros amount, whereby material assets are also possible in principle. The GmbH & Co. KG can only be founded after the GmbH has been entered in the commercial register. A social contract is also required for them.

The social contract

The partnership agreement of a GmbH & Co. KG is the legal basis of the company in addition to the commercial code (HGB). It typically regulates the following points:

  • Company Name
  • Seat of the company
  • Purpose of society
  • Shareholders and capital shares
  • Shareholder accounts
  • Distribution and withdrawal of profits
  • Management and representation of the management
  • Resolutions and passing of resolutions
  • Sale and encumbrance of limited partner shares
  • Inheritance of limited partner shares

Other facts can also be specified in the articles of association. Agreements can also be made that deviate from the provisions of the German Commercial Code (HGB). The chambers of industry and commerce offer their members and founders model contracts . However, it is advisable to consult an expert lawyer when drafting a partnership agreement.

The shareholders

The shareholders of a GmbH & Co. KG are the GmbH as a legal person and at least one other natural person . The general partner of the company is the GmbH. In this context, one likes to speak of a general partner GmbH . The general partner is jointly and severally liable to creditors with his assets for liabilities. In the case of a general partner GmbH, however, this liability is limited to the share capital. The personal assets of the GmbH shareholders therefore remain unaffected. The natural person or the natural persons who together with the GmbH form the company become limited partners called. They are only liable to the amount of the mandatory sum that they have contributed to the company, the so-called limited partner contribution .

Name of the GmbH & Co. KG

With the entry in the commercial register one speaks in general business and legal transactions no longer of the name of the GmbH & Co. KG, but of the ” company”. The company name can be chosen relatively freely. It can consist of a thing, a name, or a fantasy name. However, the addition “GmbH & Co. KG” must always be used after the designation. For example, “Lieschen Müller GmbH & Co. KG” is just as possible as “Super Laden GmbH & Co. KG”. The company name of the GmbH & Co. KG does not have to be identical to the name of the general partner GmbH. However, if they are similar, the different additives must be used. The “Lieschen Müller GmbH” therefore only designates the general partner GmbH while the “Lieschen Müller GmbH & Co. KG” stands for the entire company.

The Board

In principle, the general partner GmbH represents the GmbH & Co. KG externally. The central figure is its managing director, since a GmbH is not a natural person. The managing director (s) do not necessarily have to be a partner in the GmbH. The positions can also be filled by external candidates. One then speaks of so-called external managers. It is also possible to appoint one or more limited partners as managing directors. However, the appointment as managing director must be expressly made. In principle, limited partners are excluded from the management of the company by law. You are also not allowed to represent the GmbH & Co. KG externally. The legislature only grants them the right to object to transactions that are out of the ordinary.

What taxes are there?

Like any other company, a GmbH & Co. KG also has to pay taxes. Above all, the trade tax should be mentioned here . As a partnership, however, it is not subject to corporate tax or income tax. However, corporation tax is due on the profit share that goes to the general partner GmbH . And on the profit that the limited partners reap, this income tax must be paid. In addition, the GmbH & Co. KG may incur sales taxes , property transfer taxes , wage and income taxes for employees, inheritance taxes and gift taxes .


Every GmbH & Co. KG is subject to statutory accounting requirements . Proper double-entry bookkeeping including annual financial statements and a profit and loss account is required . Regardless of this, of course, separate annual financial statements must be prepared for the general partner GmbH and the limited partnership. In the case of the GmbH, this is subject to the regulations for corporations , in the case of the limited partnership those for partnerships.

The advantages and disadvantages of the GmbH & Co. KG


According to WHOLEVEHICLES, the great advantage of a GmbH & Co. KG is undoubtedly the limitation of liability for the shareholders . If the worst comes to the worst, the entire existence is not at stake, since only the general partner GmbH has to be liable and not its shareholders. This type of company is therefore particularly suitable for founders, as business success is usually difficult to predict. Further advantages are:

  • More flexible and easier procurement of equity through limited partner contributions
  • Possibility of so-called third party or foreign organization
  • Advantages for the company in terms of employee participation


However, the great advantages of a GmbH & Co. KG are also offset by some disadvantages. These are for example:

  • A limited creditworthiness with banks
  • Significant additional effort in bookkeeping
  • You cannot claim the remuneration for the management as a business expense for tax purposes

Special form – GmbH & Co. KGaA

A relatively young and legally controversial special form of the GmbH & Co. KG is the GmbH & Co. KGaA . The abbreviation KGaA stands for partnership limited by shares . This is a hybrid of a stock corporation (AG) and a limited partnership . Since the so-called 50-plus-1 rule can be implemented particularly well with it, many licensing departments of Bundesliga clubs choose this legal form.

GmbH & Co. KG