I’m currently researching how to get started with self-employment. I called the Institute for Liberal Professions, and they told me that I definitely need to register a business to sell crochet and knitting patterns.
My question now is, which business structure is best to choose? I’m guessing it’s either a sole proprietorship or a small business, right?
And once I’ve decided on a business structure, what exactly do I do next? I found forms online from my city to register a business, but I’m not sure what to enter for some of the fields. I’ve also seen courses offered by the Chamber of Industry and Commerce (IHK).
How did you go about it, and what tips do you have for the entire process?
Yeah, it’s a lot to take in at first and can be confusing. I think everyone here knows that feeling.
I applied for small business status through Elster.
Then I got my tax ID number, the payment form—so I knew where to pay the registration fee—and a few days later, I also got mail from the IHK...
Normally, you have to register your business with the municipality or city. I’m not familiar with the idea that you could do this through Elster.
When you register, you specify exactly what your business will entail.
It’s automatically classified as a micro-business if your annual revenue doesn’t exceed the maximum amount (it used to be €12,500—I’m not sure if the current limit has changed).
You can “opt in to the sales tax system”—Google that, and you’ll find everything you need to know.
The Chamber of Industry and Commerce (IHK), Chamber of Crafts (HWK), and Artists’ Fund… they’ll contact you automatically.
Very important: Are you employed full-time? If not, you’ll have to get your own health insurance! You’ll need to talk to your health insurance provider anyway!
It’s not enough to just register your business.
If you’re completely unfamiliar with taxes and such, it makes sense to take a seminar—for example, at the VHS.
I’m surprised you were told you need to register a business.
There are freelance writers here, too.
Where exactly do you have to specify the business structure? I just registered my business with the city. In that sense, there’s no such thing as a “small business”—you’re simply taking advantage of the small business regulation.
we just discussed the topic of business vs. freelance here recently:
https://www.crazypatterns.net/de/forum/topic/165098/geld-verdienen-mit-dem-verkauf-von-anleitungen-autor-werden-auf-crazypatterns
You’re sure to find some helpful pointers there :).
When you register your business, do so as a “sole proprietorship.” I listed “sale of digital patterns” and “online marketing” because I’m both an author of sewing patterns and a blogger, and I do a lot of online marketing—both for myself and through collaborations with companies.
“Small business” is a category used by the tax office; it has nothing to do with registering with the municipal office for the time being.
I also found some information about Elster on the website of the tax office responsible for my city, but it says that it makes filing your tax return easier—not that you can use it to register your business.
My understanding is that I should register as a sole proprietorship because the other business structures don’t apply (like a GbR, etc.), and if my annual revenue is under 22,500 euros, I can be exempt from trade tax.
The whole thing will be registered as a side job, and I’ve already informed my employer about it. Is there anything else I need to keep in mind regarding health insurance?
@Krea_Tina
The woman at the Institute for Liberal Professions told me that the patterns constitute a product and that I therefore have to register a business. If I were to write a book of patterns and have it published and sold by a publishing house, then I could do that as a freelancer.
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