🧰 Debt among the self-employed

Which special rules apply if you are or were self-employed: type of procedure and payment duty to the trustee.

self-employed standard insolvency consumer insolvency 20 creditors trustee reasonable employment relationship

In brief

Self-employed people can also obtain discharge of residual debt. Which procedure applies depends on your situation: if you are currently self-employed, you are only in the simplified procedure if your affairs are manageable.

Requirement: fewer than 20 creditors and no claims from employment relationships. As a self-employed person, during the good-conduct period you must pay the trustee as much as if you had a reasonable employment relationship.

Step by step

Count creditors and claimsFewer than 20 creditors? Are there claims from employees?
Clarify the type of procedureAdvice or the court determines whether the simplified or the standard procedure applies.
Prepare the payment dutyAnnually by 31 January for the previous year, where § 295a InsO applies.
Prove your incomeProof of the income achievable in reasonable employment.

Deadlines

fewer than 20 creditors

Requirement for the simplified procedure for formerly or currently self-employed people; in addition, no claims from employment relationships.§ 304 Abs. 1 InsO

31 January

Payments by the self-employed debtor to the trustee annually by 31 January of the following year.§ 295a InsO

Watch out – common mistakes

With 20 or more creditors or claims from employment relationships, the standard procedure applies; details not covered here.
You must prove what income you could earn in a reasonable employment relationship.
Before the amount is set, the trustee and creditors are heard; an appeal is possible.
Tax and social insurance debts may be subject to special rules; not checked here.

In depth · legal basis, figures and practice – for advisers and professionals

Type of procedure

§ 304 InsO: anyone who carries on or has carried on an independent business activity is only in the simplified procedure if their financial affairs are manageable (fewer than 20 creditors) and there are no claims from employment relationships. Otherwise the general provisions apply.

Payments to the trustee

Under § 295a InsO, the self-employed debtor must put the insolvency creditors in the position they would be in had the debtor entered into a reasonable employment relationship. Payments must be made annually by 31 January of the following year; the debtor must set out the income that could be achieved. The trustee and creditors are heard before the court sets the amount; debtor and creditors can challenge the order.

Who is responsible

Amtsgericht (local court) – insolvency court
Trustee
Insolvency and debt counselling, where applicable chambers and associations (advice for the self-employed)

Quick questions

Worum geht es bei „Debt among the self-employed“?

Which special rules apply if you are or were self-employed: type of procedure and payment duty to the trustee.

Which deadlines and figures matter?

fewer than 20 creditors: Requirement for the simplified procedure for formerly or currently self-employed people; in addition, no claims from employment relationships. (§ 304 Abs. 1 InsO)
31 January: Payments by the self-employed debtor to the trustee annually by 31 January of the following year. (§ 295a InsO)

What should I do first?

Count creditors and claims: Fewer than 20 creditors? Are there claims from employees?
Clarify the type of procedure: Advice or the court determines whether the simplified or the standard procedure applies.
Prepare the payment duty: Annually by 31 January for the previous year, where § 295a InsO applies.

What do I need to watch out for?

With 20 or more creditors or claims from employment relationships, the standard procedure applies; details not covered here.
You must prove what income you could earn in a reasonable employment relationship.
Before the amount is set, the trustee and creditors are heard; an appeal is possible.

Evidence

Gesetze im Internet, InsO § 304, retrieved 20 September 2026
Gesetze im Internet, InsO § 295a, retrieved 20 September 2026
Gesetze im Internet, InsO § 295, retrieved 20 September 2026

As of

September 2026 · Sources and method

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