Germany: becoming self-employed, registration, taxes, invoices
From choosing between trade and liberal profession to the first invoice and the duties of every year: what to do, in order.
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Time: 1 to 2 weeks to start, then every year
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Deciding
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Liberal professions are listed in § 18 EStG: for example doctors, lawyers, engineers, architects, journalists, translators and similar professions. Everything else is generally a trade.
Registering
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Whoever starts a fixed trade must report it to the competent authority at the same time (§ 14 GewO). Liberal professions need no trade registration.
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This applies to trades and liberal professions (§ 138 AO). The tax office then issues the tax number.
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In the start-up year the limit of €25,000 of turnover applies (BMF letter of March 18, 2025). The small-business calculator and the guide help you decide.
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It, or the VAT identification number, goes on every invoice (§ 14(4) UStG, § 34a UStDV).
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It is not required for sole proprietors, but it separates business and private spending and makes the records easier.
Insuring
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Those voluntarily insured in the statutory scheme pay at least contributions on an assessment basis of €1,318.33 a month (2026, GKV-Spitzenverband).
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It applies, for example, to self-employed teachers and educators, carers, midwives, artists, craftspeople on the trades register and self-employed people with only one client (§ 2 SGB VI).
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The emergency fund calculator assumes up to 6 months of necessary expenses for the self-employed.
Taxes and money
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Income tax, VAT collected and possibly trade tax fall due later; the tax office can set advance payments, on March, June, September and December 10 (§ 37 EStG).
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It applies to your whole taxable income, not just the profit from self-employment (§ 32a EStG).
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The allowance applies to sole proprietors and partnerships (§ 11 GewStG); liberal professions are generally not liable to trade tax.
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Whoever is not required to keep books can take the surplus of business income over business expenses as profit (§ 4(3) EStG).
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They are submitted electronically (Finanzämter Hessen).
Invoices
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Names and addresses, tax number, date, sequential invoice number, service, time of service, fee, tax rate and tax amount or a note on the exemption (§ 14(4) UStG).
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If you show VAT anyway, you owe it (§ 14c UStG); the note is set out in § 34a UStDV.
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Until December 31, 2026 paper or PDF with the recipient’s consent is enough, until December 31, 2027 with previous-year turnover up to €800,000 (§ 27(38) UStG).
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Invoices must be kept for eight years (§ 14b UStG).
Every year
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€25,000 in the previous year and €100,000 in the current year (§ 19 UStG).
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The tax office sets them by expected profit: with a clear change you can apply for an adjustment.
Self-employed and started
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Good to know
- The list gives the order of things to do and clarify; which rules apply to you depends on your activity. In case of doubt, the tax office, the Chamber of Industry and Commerce or a tax adviser can help.
- Trade and liberal profession are treated differently for tax: a trade needs a trade registration and may be liable to trade tax, a liberal profession not. Both tell the tax office when they start the activity (§ 138 AO).
- VAT is a pass-through item: as a small business it falls away; under regular taxation you pay over the tax collected, minus the input VAT on your purchases.
- The basic allowance and the limits apply to 2026 and may change: check them every year.
Frequently asked questions
Do I have to register a trade?
If your activity is a trade, yes: with your municipality’s trade office, at the same time as you start (§ 14 GewO). For a liberal profession (§ 18 EStG) you only report the activity to the tax office.
When do I have to tell the tax office?
Within a month of starting, with the tax registration questionnaire, which you fill in online via ELSTER (§ 138 AO). The tax office then issues the tax number.
Can I start as a small business?
Yes, as long as turnover in the start-up year does not exceed €25,000; in the following years, the previous year’s turnover up to €25,000 and the current year’s up to €100,000 count (§ 19 UStG, BMF letter of March 18, 2025).
From when do I pay trade tax?
Only from trade income of more than €24,500 a year, if you are a sole proprietor (§ 11 GewStG). The trade tax paid is credited against income tax under certain conditions.
How long must I keep invoices?
Eight years (§ 14b UStG); the period starts at the end of the calendar year in which the invoice was issued.
Next step
I’m not an accountant or a financial advisor. This is an estimate, for information only. Check with a professional before you decide.
- The calculatorGermany small-business (Kleinunternehmer) VAT exemption calculator
- The guide, in a few minutesGermany: small business exemption or regular VAT?
- The calculatorVAT and sales tax calculator
Sources
- § 18 EStG — Income from self-employed work (liberal professions) (in German)
- § 14 GewO — Duty to report the start of a fixed trade (in German)
- § 138 AO — Notifications about gainful activity (within a month, questionnaire electronically) (in German)
- Finanzämter Hessen — Guide to the taxation of influencers (questionnaire via ELSTER, trade tax, EÜR, VAT) (in German)
- § 11 GewStG — Tax rate and tax base amount (allowance of €24,500) (in German)
- § 4 EStG — Concept of profit (paragraph 3: surplus of business income over business expenses) (in German)
- § 32a EStG — Income tax scale (basic allowance €12,348 from 2026) and § 37 EStG — Advance payments (in German)
- § 2 SGB VI — Compulsory pension insurance of the self-employed (in German)
- GKV-Spitzenverband — Calculation values and thresholds 2026 (voluntary insurance: minimum assessment basis) (in German)
- § 14 UStG — Issuing invoices (mandatory details) and § 14b UStG — Retention (in German)
- § 27 UStG — General transitional provisions (paragraph 38: e-invoice) (in German)
- § 19 UStG — Taxation of small businesses and § 34a UStDV — Invoices of small businesses (in German)
For taxes, bookkeeping and the choice of legal form, a tax adviser can help you; for questions about the trade, the Chamber of Industry and Commerce or the Chamber of Crafts.