The terms “Freiberufler“, “freelancer” and “self-employed” are often confused and used as synonyms.
Self-employed people in Germany are classified by the authorities
- either as business people (Gewerbetreibende)
- or as members of the liberal professions (Freiberufler)
Did you know:
- The determination of whether your activity is classified as a commercial business (Gewerbe) or a liberal profession (Freier Beruf) is not up to you. It is decided solely by the tax and trade authorities. This classification is based on statutory law and local court rulings. Because the distinction is often highly complex and depends heavily on the individual case, it is strongly recommended to seek professional guidance. You can get specialized advice from the Institute for Liberal Professions (IFB Institut für Freie Berufe) via their start-up hotline at +49 (0) 911 23 565 28. Please note that the colloquial English term Freelancer carries no legal weight in this official classification process.
- It is a common pitfall that individuals who consider themselves liberal professionals successfully submit their registration to the tax office without immediate inquiries. They frequently and wrongly assume that this implies automatic, permanent recognition. However, during a subsequent tax audit, the tax office can retroactively reclassify the activity as a commercial business at any time, triggering retroactive trade registration and trade tax (Gewerbesteuer) liabilities.
- Furthermore, jurisdictional conflicts can arise where the tax office accepts a liberal profession status but Business Licencing Office (Gewerbeamt) demands a commercial business registration (Gewerbeanmeldung). For example: sports and recreational lessons (such as dance, gymnastics, tennis, fencing, golf, skiing, mountaineering, swimming, yoga, fitness, and personal training) generally require a Gewerbe registration. The Business Licencing Office (Gewerbeamt) argues that these activities do not strictly require a university degree to be practiced.
- Coaching, consulting, teaching and training rarely classify as a liberal profession. Please refer to our special information for coaching, teaching and consulting activities.
- What exactly is a “Gewerbe”? A Gewerbe does not only refer to the sale or trade of physical goods; it also encompasses services and craft activities. Legally, it is defined as any planned, permanent, and self-employed activity undertaken with the intention of making a profit—excluding only agriculture, forestry, and the liberal professions.
Regardless of whether you are classified as a commercial business owner or a liberal professional, you must fulfill the following foundational requirements:
- Tax Compliance: Both categories are subject to taxation and can apply for the small business owner regulation (Kleinunternehmerregel).
- Social Insurance: Both groups must independently verify which branches of the social insurance system (such as pension and health insurance) they are legally required to contribute to.
- Legal Structure: Both must select an appropriate legal form (e.g., Einzelunternehmer or GbR) before officially registering.
- FAQ How to register with the authorities
Are you planning to apply for a residence permit that allows you to go self-employed in Munich?
Please refer to our online information
Freelancing is not a legal form and should not be equated with “Freiberufler” work.
- The terms “freelance” and “freelancer” translate to „Freie Mitarbeit“ and “Freier Mitarbeiter” in German.
- “Freie Mitarbeiter” are not employed by a company but are self-employed. Either with a business or a liberal profession.
- “Freie Mitarbeiter” accept orders from business partners based on a service contract (freier Dienstvertrag), a contract for work and services (Werkvertrag) or a hybrid form. Anyone who concludes a contract for “Freie Mitarbeiter” does not automatically work as a Freiberufler!
- Important topics for “Freie Mitarbeiter” are bogus self-employment and employee-like self-employment.
- Download Institute for Liberal Professions’ information sheet Freie Mitarbeit ist nicht Freier Beruf: Was ist der Unterschied? (PDF, 92 KB)
“Kleinunternehmen“ and “Kleingewerbe“ are not legal forms.
- These terms are used when you generate sales and profits at a level specified by European Union regulations and the German Commercial Code, among others.
- Visit our page choice of legal structures for an overview.
Kleinunternehmerregelung – the small business owner regulation
- This term refers to a statutory simplification regulation in VAT law for self-employed persons with only low turnover.
- Both businesses as well as liberal professions can use “Kleinunternehmerregelung” .
- Do you have customers outside Germany, for example in other EU countries or third countries? Self-employed persons who “Kleinunternehmerregelung” in Germany need to be extremely careful here.