Self-employment in Germany

do’s and don’ts of self-employment

The first thing you have to do if you are moving to Germany with the intention of being self-employed is to apply for a residence permit. The permit will only be valid for a certain period of time with an option of renewal.

Self-employment in Germany

To get a residence permit, you must present the following:

  • your business plan
  • your qualifications and previous experience
  • your financial investment
  • your company’s impact on employment and vocational training
  • your contribution to the national or regional economy, innovation, and research competition with established businesses

Self-employed immigrants who want to invest a minimum of 250,000€ in Germany, thereby creating at least five new jobs, obtain a residence permit almost automatically. In all other cases, your application will be carefully reviewed.

Registration

Those who are self-employed are not required to follow the same registration policies as business companies. They must register with the local tax authorities and the responsible professional association.
Registering with the local tax authorities is very straightforward and can be done with an informal letter or by email, however, the registration at the responsible professional association must be done formally, by completing various official forms and presenting necessary documents.

Social security

Under a law called the Social Law for Artists (Kuenstlersozialversicherungsgesetz), artists and journalists are required to contribute to the following:

  • Pension insurance: 19.6 percent of their total income
  • Health insurance: 15.5 percent of their total income
  • Care insurance: 1.95 percent (for parents) or 2.20 percent (for childless individuals) of their total income.

Other freelancers don’t need to contribute to the German healthcare, pension or unemployment insurance, however, they should consider making their own arrangements for the following:

  • Private health insurance
  • Health insurance
  • Disability insurance
  • Life insurance

Individuals should take into consideration that since 2009, all expats living in Germany must hold valid health insurance.

To get a residence permit, you must present the following:

  • your business plan
  • your qualifications and previous experience
  • your financial investment
  • your company’s impact on employment and vocational training
  • your contribution to the national or regional economy, innovation, and research competition with established businesses

Self-employed immigrants who want to invest a minimum of 250,000€ in Germany, thereby creating at least five new jobs, obtain a residence permit almost automatically. In all other cases, your application will be carefully reviewed.

Registration

Those who are self-employed are not required to follow the same registration policies as business companies. They must register with the local tax authorities and the responsible professional association.
Registering with the local tax authorities is very straightforward and can be done with an informal letter or by email, however, the registration at the responsible professional association must be done formally, by completing various official forms and presenting necessary documents.

Social security

Under a law called the Social Law for Artists (Kuenstlersozialversicherungsgesetz), artists and journalists are required to contribute to the following:

  • Pension insurance: 19.6 percent of their total income
  • Health insurance: 15.5 percent of their total income
  • Care insurance: 1.95 percent (for parents) or 2.20 percent (for childless individuals) of their total income.

Other freelancers don’t need to contribute to the German healthcare, pension or unemployment insurance, however, they should consider making their own arrangements for the following:

  • Private health insurance
  • Health insurance
  • Disability insurance
  • Life insurance

Individuals should take into consideration that since 2009, all expats living in Germany must hold valid health insurance.

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