In principle, anyone can become self-employed in Germany, including professionals from Switzerland, an EU country or a member of the EEA. There are three different types of self-employment:
The first step is to find out which of these categories applies to the business that you wish to launch in Germany. And you need to know whether or not you fulfil the requirements – both regarding qualifications and other specific formalities. In Germany, people refer to professional, qualification-related and formal requirements; you may also come across the term "requirements of the profession" (Anforderungen an den Berufsstand) in this context. As the conditions and requirements differ for the three types of self-employment, the first task is to find the correct category for your business idea.
Here you can find an overview of which forms of self-employment are considered to be a business or trade, a freelance profession or an itinerant trade in Germany, and the particular requirements relating to these.
"Fictitious self-employment" (Scheinselbständigkeit) is the term used to describe self-employment that does not fulfil these requirements and rules. Fictitious self-employment often occurs in cases where the person in question only has one client over an extended period of time. Fictitious self-employment is forbidden in Germany and is a punishable offence; both for the person guilty of fictitious self-employment and their single client.
In Germany, the term "trade" can be used to refer to almost every business activity that involves earning money. This is also designated as a stationary trade, in contrast to an itinerant trade. The one exception is self- employed persons who practise a freelance occupation or who work in farming or forestry – they do not conduct a trade. Freedom of trade applies in Germany. This means that, in theory, everyone is free to practise a trade. In practice, freedom of trade is, however, not unrestricted as certain requirements need to be fulfilled for certain trades. You can find out which requirements apply to which trades here.
Freelance professions include independently practised jobs in the fields of science, art, writing, teaching and education.
There are also specific differences concerning taxation: Freelancers do not need to pay any commercial tax on their freelance occupation. It is also easier to provide proof of income to the local tax office (Finanzamt) for the annual tax return than it is for tradesmen and women – a profit and loss account will generally suffice. The local tax office is in charge of granting permission for someone to work as a freelancer. You can find out which occupations are defined as freelance professions and the specific requirements for those professions here.
Self-employed, trade occupations are categorised as itinerant trade under the following conditions:
Occasionally, an itinerant trade may provide the opportunity to carry out a specific occupation on a self- employed basis, even in cases where the necessary qualifications have not – or have not yet – been sought. You must, however, adhere to the requirements concerning itinerant trade. You can find out what they are here.
In the case of small start-ups it is important to clarify whether the self-employment will provide the main source of income or just be a supplementary source, as this affects health insurance contributions. For self- employment as the main source of income: