Accounting for the UG: This is how double bookkeeping works

Accounting is the foundation of your UG. It ensures transparency about your financial situation, supports business decisions and protects you from tax and legal risks.
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As a corporation, UG, just like a GmbH, is obliged to keep proper bookkeeping and to prepare regular balance sheets. If these obligations are neglected, there is a risk of fines or even liability consequences.

However, well-organized bookkeeping is much more than a legal obligation. It shows you how your company is developing and helps you make well-founded decisions based on current figures. Only those who keep an eye on income, expenditure and liquidity can react in good time to bottlenecks and plan investments in a targeted manner.
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Transparent accounting also builds trust vis-à-vis banks and investors. It signals that your company is professionally managed and has a stable financial basis. Therefore, use your UG's accounting not only to comply with legal requirements, but also as an important management tool for sustainable success.

Dual bookkeeping is the central principle of bookkeeping. It ensures that all financial transactions of your company are recorded seamlessly and comprehensibly.
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The basic principle is simple: Everyone business transaction will Booked twice, Once on target and once on. This creates a complete picture of all cash flows. A simple example: If you sell goods on account, the amount is recorded in the possession of the revenue account and in the debit of the receivables account. In this way, it is always possible to see where income comes from and where expenditure is flowing.
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For UGs, double bookkeeping is required by law — regardless of turnover or company size. It forms the basis for the balance sheet and the profit and loss statement (P&L), which are prepared at the end of a financial year and published in the electronic Federal Gazette.
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So that you can better understand the structure, here is an overview of the most important components:
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Opening balance
It is created at the start of business activity and shows the starting capital and the initial values of all assets. The legal minimum share capital of a UG is 1€.

Chart of accounts
The chart of accounts or chart of accounts systematically depicts all business transactions — from income and expenditure to liabilities and receivables.

Journal
In the journal, all bookings are recorded in chronological order. It is therefore the “diary” of your bookkeeping.

ledger
The general ledger summarizes all transactions from the journal thematically and assigns them to the respective accounts.

Inventory and financial statements
An inventory is carried out at the end of the financial year. It forms the basis for the balance sheet and income statement, which show how your company has developed financially.

Since double bookkeeping is required for UGs, the processes are somewhat more complex. This means that if you take care of your bookkeeping yourself, you will probably have to invest a lot of time — especially at the beginning. Time in which you could actually focus on your core business.
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Whether you the Outsource accounting for your UG, is also dependent on your professional know-how, your security needs and a general basic interest.
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Both the decision to take care of your bookkeeping yourself and outsourcing have advantages and disadvantages. In the table below, you can see which details should be considered.

Hybrid solution: The best of both worlds
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Many founders choose a middle way. You will do simple preparatory work yourself, for example:
· Digitally sort and upload documents
· Check incoming payments
· Add notes to documents

Dein tax advisor then takes over the examination and the conclusion. In this way, you save costs, keep an overview and can still rely on professionally clean accounting.

Regardless of whether you do your bookkeeping yourself or work with a tax advisor, the right software is the key to simplifying processes and avoiding mistakes. Modern accounting solutions automate many tasks, help you with double-entry bookkeeping and make it easier to communicate with your tax advisor.
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The following is an overview of popular tools that are particularly suitable for UGs. Many of these programs can also be used for Accounting of a GmbH use. This is handy if your UG is growing or you are planning to switch to a GmbH in the long term — the software can then simply continue to be used.

Integral
With Integral, you get an all-round solution for accounting for your UG. The solution is particularly recommended for small and medium-sized companies that want to automate accounting and tax advice and obtain various solutions from a single source.
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The most important functions include automatic booking processing, document management, payroll and the ability to prepare tax returns and annual financial statements — for example in collaboration with a tax advisor.
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The user interface is clear and structured and because Integral places so much value on automation, you don't have to invest more time than necessary in your tax here. You also benefit from direct contact with a tax advisor who will answer your questions within 24 hours.

Lexware
Lexware's accounting software is aimed primarily at small and medium-sized companies and UGs. The integrated functions include double-entry bookkeeping, financial statements, EURE, connections to online banking and debt collection, and DATEV. The menus are intuitive and therefore largely self-explanatory. There are various tariffs available here, which you can individually adapt to your area of application.
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DATEV
DATEV's solution is aimed primarily at law firms and larger companies. The system integrates extensive functions related to accounting, bookkeeping, various tax functions and payroll.
Many companies use this solution to work closely with their tax advisor. Due to the level of detail required, many law firms also recommend that their clients set up their accounting for UG on DATEV.

The answer to the question of whether you, as the person responsible for a UG, take care of your tax yourself or outsource the whole thing is of course always dependent on the available budget.
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The following comparison will help you to assess the whole thing a bit better:

Apart from the fact that it is important to calculate the costs that accounting entails for your UG, you shouldn't base your decision exclusively on expenses. Because: Investing in a tax advisor always means less effort, more security and professional advice. You must decide how much these benefits are worth to you in the end.

Mr. M. has recently founded a UG and specializes in e-commerce. So that he doesn't have to delve too deeply into double-entry bookkeeping, he has opted for a hybrid solution. He uses Integral to prepare his accounting, while the final audit and financial statements are carried out by his tax advisor.
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Mr. M. simply uploads his invoices via the platform. The data is automatically read out, booked and assigned. At the end of the month, he only checks and confirms the prepared advance sales tax return. It is then submitted to the tax office in due time.
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Integral's close cooperation with tax advisors is also practical: Mr. M. knows exactly who to contact if he has any questions and receives quick feedback. This allows him to concentrate on his day-to-day business while accounting runs reliably in the background.
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Because the solution is scalable, it remains flexible even as it grows. So should his UG become a GmbH one day, he can simply continue using Integral.