🧭 Overview: rights and obligations as a self-employed person
In brief
As a self-employed person you work on your own responsibility and at your own economic risk – unlike employees, who are bound by instructions and integrated into a business. Tax law distinguishes two groups: freelancers (§ 18 EStG) and traders (Gewerbetreibende, § 15 EStG). Depending on which group you belong to, different registration obligations, taxes and chamber memberships apply.
This page gives an overview of the first steps and refers to the in-depth topics of this Wegweiser.
Step by step
- Classify your activityCheck whether you have a listed profession or one similar to it under § 18 para. 1 no. 1 EStG (e.g. doctor, lawyer, architect, journalist, interpreter) – then you are a freelancer. Everything else is usually a trade business (§ 15 EStG).
- Register a trade business (traders only)Freelancers do not register a trade business. Traders notify the trade office (Gewerbeamt) of the start of their activity – by law “at the same time” as the business starts (§ 14 para. 1 GewO), so in practice preferably before the first order.
- Inform the tax officeSubmit the tax registration questionnaire electronically via ELSTER – no later than one month after starting the activity (§ 138 paras. 1 and 4 Abgabenordnung, AO).
- Clarify chamber membershipTraders automatically become compulsory members of the IHK (§ 2 para. 1 IHKG) or, if entered in the register of craftsmen (Handwerksrolle), of the Handwerkskammer (chamber of crafts). Freelancers without an entry in the commercial register are in principle not subject to compulsory IHK membership (§ 2 para. 2 IHKG).
- Check social insuranceClarify health insurance, possible compulsory pension insurance (§ 2 SGB VI) and – for artistic or publishing work – the artists' social insurance (Künstlersozialversicherung). The separate topic pages of this Wegweiser go into this in more depth.
- Have your status clarified if in doubtIf you are unsure whether an activity is really carried out on a self-employed basis, the status determination procedure of the clearing office (Clearingstelle) of Deutsche Rentenversicherung Bund helps (§ 7a SGB IV) – see the topic on false self-employment.
Deadlines
- Confusing freelance work with a trade business: wrong classification can lead to back payments of trade tax or a fine for failing to register a trade business.
- The often-cited “one-week deadline” for trade registration is not in the law as such – § 14 GewO requires notification “at the same time” as the start of business, so in practice without delay.
- Late registration with the tax office (more than one month) can delay the issuing of your tax number.
- False self-employment is often only discovered in an audit – with a high risk of back payments for both client and contractor.
- Health insurance is often arranged late, which can leave a gap in coverage.
In depth · legal basis, figures and practice – for advisers and professionals
Distinguishing freelancers / traders
§ 18 para. 1 no. 1 EStG lists professions by name (including doctors, lawyers, tax advisers, architects, journalists, interpreters) as well as professions similar to them; the requirement is usually a special qualification (degree/training) and a managing, self-responsible activity even where employees are used. Anything that is not a freelance profession or agriculture and forestry counts as a trade business (§ 15 EStG).
Distinguishing self-employed people / employees
§ 7 para. 1 SGB IV defines employment as dependent work, in particular in an employment relationship; indications are being bound by instructions and being integrated into the client's work organisation. What matters is the overall picture of the actual circumstances, not the label in the contract. Clarification is possible through the status determination procedure under § 7a SGB IV at the clearing office of Deutsche Rentenversicherung Bund (since 1 April 2022 only a determination of employment status as a whole, no longer of individual branches of insurance).
Chamber membership
Traders are compulsory members of the IHK by law (§ 2 IHKG); those entered in the Handwerksrolle are compulsory members of the Handwerkskammer, and where applicable also of the IHK for non-craft parts of the business (§ 2 para. 3 IHKG). Many IHKs grant founders contribution reductions in the first years below certain turnover or profit limits – these limits are not uniform nationwide but set regionally in each chamber's statutes; ask the responsible IHK in each case.
Social insurance obligations of selected groups
§ 2 SGB VI assigns certain groups of self-employed people to compulsory pension insurance by law (including craftsmen entered in the Handwerksrolle, self-employed teachers and educators without employees subject to social insurance, carers, artists and publicists via the artists' social insurance). This is an exhaustive list, not a general obligation for all self-employed people. For people who are self-employed as their main occupation, there is as a rule no compulsory insurance in statutory health insurance; continuing as a voluntary member is possible (§ 9 SGB V). For more detail: separate topic pages on health insurance, retirement provision obligation and the Artists' Social Insurance Fund.
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