The Ever Evolving FAQs for Freelancing in Germany
Most frequently asked questions that you may have about freelancing in Germany. If you have a question that you don't see here, then shoot me an email. I'll try to answer as fast as I can.
Yes, it is possible to apply for a freelancer visa from outside of Germany. Depending on your nationality, you will be granted an entry visa, allowing you to enter Germany and register as a freelancer here.
Yes, of course! Applying for German freelance visa as an Indian or a Non-EU national is quite straightforward if you are already living in Germany on a valid residence permit.
There are some specific requirements for foreign nationals applying for German self-employment visa.
Anyone wishing to set up their own business in Germany must deal with the formal framework right at the beginning. This includes, above all, the question of the tax status: Are you a Freiberufler (Freelancer) or Gewerbe in Germany?
With a lot of paperwork…and patience! 😉
You will need to start by finding out the responsible Tax Authority (Finanzamt) of your city.
Scheinselbstständigkeit or fake self-employment in Germany is an inadvertent trap for freelancers and businesses. When caught – the status of the freelancer can be withdrawn and the client can be asked to pay social security contributions retroactively, which can sometimes run into massive figures.
As of 2019, students from a non-EU country may freelance in Germany along with their studies. You have to apply for a separate German freelance permit to be able to work as a freelancer in Germany.
However, as a full-time student, you are allowed to work about 180 hours per year as an employee. There’s no upper limit on your income. You will have to pay taxes once you cross a certain income threshold.
Depends on your German national visa and your employers’ policy. Check the accompanying documents with your visa. Does it say Selbständige Tätigkeit gestattet? If yes, then good news for you. You can take up freelancing in Germany besides your normal work. But before you take on your first client, you will still need written permission from your main employer that you can actually freelance in Germany or not.
Yes, absolutely! I got my German freelancer visa with only Upwork clients in my portfolio. At the end of the day, your visa officer is concerned about your monthly or yearly income, and not the geographical origin of your clients. Having said that it is helpful to have some German clients to avoid raising any unnecessary issues during your visa processing.
It is possible. If you decide to hire an employee or a mini-jobber then you will no longer be recognised as a freelancer but as an employer. You will also have to contribute towards the social security and health insurance of your employees. Since a lot of bureaucracy and paperwork is involved with this change, you would want to assess whether you really want to hire employees or working with other contractors will also solve your resource issues.
It is possible to hire other freelancers even if you are a freelancer yourself. You can contract to work them as usual and write off their invoice as business expenses. As opposed to hiring a regular or part-time employee on your payroll, you are not required to contribute towards the social security and health insurance of freelancers.
In principle, the scope of services of a private current account and a business account is very similar. However, it is advisable for business owners to open a separate account for business purposes, even if the number of monthly transactions is low in the beginning.
Both options are possible. However, it may cost more to hire an accountant to handle your monthly bookkeeping. There are also several accounting and invoicing tools that can automate the entire bookkeeping process for you and cost only 5€ per month.
Well, how is your understanding of the German tax system? If you are completely new to it and you’re generating quite a few invoices and charging VAT, then I’d recommend hiring an accountant. If you’re a fairly small-time freelancer with very simple accounting requirements, then you can use one of the many taxation tools designed specifically for the German tax system.
Yes. However, in German law, a home office should be a proper room with walls and a door. Putting a work desk in the living room corner does not count as a home office. Also, the home office should only be used for work-related activities. You cannot use one room as a guest room or home office. It should be used exclusively for your freelancing work.
Business owners with low turnover are classified as small entrepreneurs. If your turnover in the previous year did not exceed €
17,500 /€22,000 from 2020) and turnover in the current year is unlikely to exceed € 50,000.00 then you are considered Kleinunternehmer or small entrepreneur. Both of these conditions must be met. If you use Kleinunternehmerregelung or the small business regulation, you do not have to charge sales tax on your turnover.
You can choose either a public health insurance company or a private health insurance provider. In some very rare cases, international health insurance policies are also accepted. All have their own pros and cons and you have to use your own personal judgement and make an informed decision on which is the best-suited insurance provider for your requirements.
It is advisable to have private liability insurance when you live in Germany. Most German freelancers also don’t start freelancing without having a Verdienstausfallversicherung (Loss of Earnings Insurance) and Berufsunfähigkeitsversicherung (Occupational Disability Insurance).
This is a very personal choice and both career paths have their own pros and cons. Some people prefer the safety and stability of a full-time employment, and some like the freedom that comes with freelance opportunities. How much you earn really depends on how hard and smart you can work. Your mileage may vary.