Germany distinguishes between two types of self-employment: Freiberufler (liberal professions) and Gewerbetreibende (trade business owners). The distinction matters for tax, registration, and ongoing bureaucracy — and many people get this wrong at the start.
Freiberufler vs Gewerbe
Freiberufler professions include: doctors, lawyers, architects, engineers, journalists, translators, artists, musicians, teachers, and certain IT consultants. These professions are exempt from trade tax (Gewerbesteuer) and don’t need to register a Gewerbe with the city.
If your work involves buying and selling goods, running a restaurant, or most service businesses that aren’t on the Freiberufler list, you register as a Gewerbetreibender at the Gewerbeamt. This adds trade tax on profits above €24,500/year.
Registering as Freiberufler
Step 1: Fill out the Fragebogen zur steuerlichen Erfassung (tax registration questionnaire) from your local Finanzamt. You can do this online at elster.de or download the form. State that you’re registering as a Freiberufler. Step 2: The Finanzamt assigns you a Steuernummer (tax number) within 2–6 weeks. Step 3: Get a Gewerbeschein only if the Finanzamt determines your work is actually a Gewerbe.
VAT (Umsatzsteuer)
Freelancers billing below €22,000 in the first year (and €50,000 in subsequent years) can use the Kleinunternehmerregelung — small business exemption from VAT. You don’t charge VAT and don’t file quarterly VAT returns. Simple, but you also can’t reclaim VAT on business expenses. Once you exceed the threshold, you must charge 19% VAT and file quarterly.
Insurance Requirements
Self-employed people must arrange their own health insurance. If you were previously in GKV, you can remain in the voluntary public system — contributions are based on estimated income with a minimum of around €220/month. Pension contributions are optional for most Freiberufler (mandatory for certain professions like journalists and artists via Künstlersozialkasse).
Invoicing and Accounting
Keep records of all invoices, receipts, and bank statements. The Finanzamt can audit the last 10 years. Many freelancers use tools like Lexoffice, sevDesk, or Fastbill for invoicing and accounting. Annual tax returns (Einkommensteuererklärung and, if applicable, Umsatzsteuererklärung) are due by July 31 of the following year. A Steuerberater (tax advisor) costs €50–200/hour and is often worth it in year one.
