How to start a business in Germany

How to start a business in Germany

A detailed guide to all the rules you must follow when starting a business in Germany, from registering as a freelancer to paying your taxes.

This guide gives you a general roadmap for starting a business in Germany, and particularly in Berlin. It covers everything from the business registration to paying your taxes.

Useful vocabulary

Before you get started, here are a few terms you must understand:

  • Aufenthaltstitelresidence permit, or visa.
  • Bürgeramt: the citizens office. This is where you register your address.
  • Finanzamt: the tax office. You must go to your district's Finanzamt. You can find the correct Finanzamt for your area on this page. Just enter your postal code in the search box.
  • Freiberufler: freelancer. In Germany, this title is reserved to specific professions, so not every freelancer is a Freiberufler. See below for more details.
  • Gewerbe: trade or business. Self-employed workers that are not Freiberufler must register as a Gewerbe. You need a trade licence (Gewerbeschein) to operate as a Gewerbe. See below for more details.
  • Gewerbeschein: trade licence. This allows you to operate as a Gewerbe.

Step 1: Register your address in Germany (Anmeldung)

In Germany, you must register your address every time you move. The address registration process is called the Anmeldung. When you register, you get a tax ID (Steueridentifikationsnummer) and a certificate of registration (Anmeldebestätigung). You will need these later.

You need the certificate of registration to open a bank account, and you need a bank account to register your business with the Finanzamt. You also need a tax ID to register your business.

For more details, see How to register your address in Germany and How to find your tax ID.

In this step, you need:

In this step, you will obtain:

Step 2: Open a bank account

You will need a German bank account when you declare your business to the Finanzamt, and when you start paying taxes. If you don't have a bank account yet, take a look at our overview of German banks.

You do not need a business account; a normal bank account is fine. However, some banks will close your account if you use it for business purposes.

Bank accounts in other European countries are also fine, as long as they support SEPA transfers.

In this step, you need:

In this step, you will obtain:

  • A bank account

Step 3: Get the right visa

If you are not a European Union citizen, you are not allowed to freelance in Germany without a visa.

On your residence permit (Aufenthaltstitel), look for a line that says "Selbständige Tätigkeit gestattet" (self-employment allowed). If your residence permit has that line, you can freelance or start a business in Germany. If it doesn't, you must apply for a German freelance visa.

In this step, you will obtain:

  • A residence permit (Aufenthaltstitel)
  • The permission to be self-employed in Germany

Step 4: Find a tax advisor

Tax advisors are very expensive in Germany, but they will save you a lot of money. They can register your business  for you and take care of your tax declarations. They will help you avoid many mistakes with taxes and health insurance.

See our list of English-speaking accountants and tax advisors in Berlin.

Step 5: Know if you are a Freiberufler or a Gewerbetreibender

Later, you will need to register your business with the tax office (Finanzamt). They will decide if you are a freelancer (Freiberufler) or a tradesman (Gewerbetreibender).

The difference is very important. Tradesmen must get a trade licence (Gewerbeschein) and pay a trade tax (Gewerbesteuer). They must also be listed in the trade register (Handelsregister) and follow different accounting rules. You must do these things before registering your business with the Finanzamt.

Life is much easier for Freiberufler, but not every freelancer is a Freiberufler! This title is reserved for specific professions. Engineers, doctors, architects and teachers can be Freiberufler. Common jobs like food delivery driver or tour guide do not qualify as Freiberufler, but as a Gewerbe12.

See Freiberufler or Gewerbe, what's the difference? for a detailed explanation.

Step 6: Get a trade licence (Gewerbeschein)

If you are a registering a Gewerbe, you must get a trade licence (Gewerbeschein) before visiting the Finanzamt.

In Berlin, you can obtain your Gewerbeschein from your local Ordnungsamt. You can also do it online. This guide shows you how.

In this step, you will obtain:

Step 7: Register your business with the Finanzamt

The next step is to declare your business to the Finanzamt. You do this by filling the Fragebogen zur steuerlichen Erfassung. You must submit this form to your local Finanzamt in person or by mail.

This is a long and complicated form. Your tax advisor can fill it for you.

In this step, you need:

In this step, you will obtain:

Step 8: Inform your health insurance company

If you already have health insurance, you must tell your insurance company that you are going freelance. Health insurance for freelancers is more expensive, since your employer is not paying half of it. The money will be taken directly from your bank account every month.

If you have public health insurance, the cost of your insurance depends on your income. Since you don't know your future income, you will give an estimation. If you pay too much insurance, you will get a refund later. If you don't pay enough, you will get an invoice later.

See Health insurance in Germany

Step 9: Update your website

If you have a website, make sure it complies with the various German and European regulations. There are stories of website owners receiving damage claims because they had a missing Impressum or incorrectly attributed photos. It happened to us.

See Running a website in Germany: everything you must know

Need help?

These resources offer information, advice and counselling for business owners and freelancers in Germany. They are here to answer your tough questions and put you on the right path.

Official resources

Local chamber of commerce websites:

Business, startup and freelancing communities

English-speaking professionals

Comments

  • Leave a comment