Can I work as freelancer next to a fulltime job and how ?

24 posts in this topic

Hi all,

 

my question is partially answered in previous one therefore I am asking again.

 

My situation is this:

1. I am full time employed and got written letter of approval from my company which allows me to do separate activity as well

2. I have a private website and mobile app in which I sell digital products and receive money in my bank account

 

What I want to do/need advice:

 

I am receiving more then 20 000 euro per year as extra income thanks to my Nebenjob activity.

I want to be totally legal and register now either as Gewerbe/Freiberuflich (dont know what is fit for my purpose) while also working full time job.

 

Questions:

1. Can that be done ?

2. If yes, what should I register. As gewerbe or Freiberflich ? I can earn extra income even more then 100 000 euro per year

3. What about the taxes and insurances ??? Right now the company pays my health insurance and social ones and I want to keep this that way. I only want to pay extra tax according to the rules for my extra income. Is that possible or how does it work?

 

Thank you all!!!

Danke Schön!!!

 

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When I was working full-time and did some freelance work at the same time, I ended up paying so much tax it wasn’t even worth it.

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1 hour ago, Santitas said:

When I was working full-time and did some freelance work at the same time, I ended up paying so much tax it wasn’t even worth it.

Hi, why ?

Can you please explain more details on how much taxes you had to pay when working both as freelancer + fully employeed.

 

1. Did you register as Gewerbe ?

2. I am currently tax 1 category (single not married fully employeed). When you did full employment+freelancer what category did you move or still 1 ? Why did tax change and by how much ?

I thought that for example you earn 50000 eur per year from ffull employment you get tax on it keep almost 25 000

You get 100000 euro per year via frellancing, you get let say 40% tax on it keep 60 000

 

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15 hours ago, mitsmorri said:

 

3. What about the taxes and insurances ??? Right now the company pays my health insurance and social ones and I want to keep this that way. I only want to pay extra tax according to the rules for my extra income. Is that possible or how does it work?

 

 

As far as I can google, if you make "too much" money from being self employed, your kk may decide that your self employment is no longer a side job and want to charge you accordingly.  Maybe ask your kk?

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2 hours ago, LeonG said:

 

As far as I can google, if you make "too much" money from being self employed, your kk may decide that your self employment is no longer a side job and want to charge you accordingly.  Maybe ask your kk?

Thanks, what is a kk ?

 

So it is not allowed to work on the side if you have a full time employment ?

I don't consider it a side job. I do full time employment + lets say freelance or bussiness on the side

 

I want to know if that is allowed as long as I pay all taxes correctly. As we are free people I don't understand why something like this can be limited. A strongly wiled person might work until 4 pm, then work again 6 until 12 at night if they want to earn more. (also have permission from work to do other business on my time)

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KK=Krankenkasse

ie your health insurance company

 

They may have rules that could class you as a self employed person, thus dramatically changing your health insurance fees.

Have a chat with them. Is this a one off year? Or do you expect your side job to run for years?

 

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1 hour ago, HH_Sailor said:

KK=Krankenkasse

ie your health insurance company

 

They may have rules that could class you as a self employed person, thus dramatically changing your health insurance fees.

Have a chat with them. Is this a one off year? Or do you expect your side job to run for years?

 

Thanks for explanation.

 

This is a thing that I might run for years for my entire life, have full time employment + other business as well.

 

Interesting did not knew that kk is taking taxes and we need to ask them permission if want to start bussines aside full time job.

Will contact them. For me is fine i can pay them more as long as i earn more i don't mind it.

My question is more like

1. is this allowed

2. if it is allowed what steps do i need to do to make this fully legal and pay all i have to pay like extra tax, kk and keep working in peace

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45 minutes ago, mitsmorri said:

Interesting did not knew that kk is taking taxes and we need to ask them permission if want to start bussines aside full time job.

 

 

Well, if I was pedantic, the health insurance people  don`t charge taxes

but they do have their monthly fees.

 

Self employed have to pay these fees.

Whereas employees split them 50:50 with their employer

 

I would suggest you take a look at the TT Wiki about health insurance.

There`s a  minefield ahead of you and you may well need to have a chat with a professional advisor

to fully understand the consequences.

 

Wiki Health insurance

 

 

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1 hour ago, HH_Sailor said:

 

Well, if I was pedantic, the health insurance people  don`t charge taxes

but they do have their monthly fees.

 

Self employed have to pay these fees.

Whereas employees split them 50:50 with their employer

 

I would suggest you take a look at the TT Wiki about health insurance.

There`s a  minefield ahead of you and you may well need to have a chat with a professional advisor

to fully understand the consequences.

 

Wiki Health insurance

 

 

Thanks a lot I will check that.

 

Now I understand why a lot of German friends I know are taking money in countries outside Germany lol because it is so hard to work more then one job here with so much rules.

People I know have registered accounts in Estonia and other foreign countries take money there for extra activities and withdraw with cards etc.

 

I was interested to do it in proper way just Germany based fully 100% legal  willing to pay all taxes I had to.

So in principle I work more I pay more that is all. I see no reason why state tells me: hey look dont work more then 1 job.

I am a free person I can have both work and business as long as I pay all obligations

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It's not hard to work more than one job here and nobody is saying you can't have a job and a business.  You just have to pay for it.

 

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If your freelance income goes over what you make at your full time job, you will be responsible for ALL of your health insurance payments. That can get very expensive. If you are making 4000 freelance and 3000 your full time job, then you are responsible for paying about 700 to your Krankenkasse per month. 

 

Edit: I use public health insurance. At my age (45) it is not worth it to go to private now, IMO. I have heard private can be good for young people. 

 

Freelance is not worth the hassle, IMO. 

 

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4 hours ago, mitsmorri said:

Thanks a lot I will check that.

 

Now I understand why a lot of German friends I know are taking money in countries outside Germany lol because it is so hard to work more then one job here with so much rules.

People I know have registered accounts in Estonia and other foreign countries take money there for extra activities and withdraw with cards etc.

 

I was interested to do it in proper way just Germany based fully 100% legal  willing to pay all taxes I had to.

So in principle I work more I pay more that is all. I see no reason why state tells me: hey look dont work more then 1 job.

I am a free person I can have both work and business as long as I pay all obligations

 

I am not an accountant, but I think your German friends are supposed to be reporting that money? I don’t know. 

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Do you not have an accountant to do your German taxes and if so, can't you just ask there? My ex emails the accountant that did our taxes all the time with questions. One of them being: if i do extra work how will it affect my tax bracket and, if so, how much can I earn before it changes my tax bracket? 

As knowledgeable as people are on here, I'd want to hear this kind of thing straight from a professional.   And if you are earning that kind of money in a side job and you don't have an accountant, I would love to know why. When I first came to Germany I worked as a freelancer. Earned almost nothing and my ex did my taxes. They weren't accepted. We had an accountant ever since then and while it wasn't cheap, it was worth it.  And if you are making that kind of money as side money, you probably can afford one.  

 

just my 2 cents

 

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On 5/6/2022, 11:13:53, rmaetzing said:

Do you not have an accountant to do your German taxes and if so, can't you just ask there? My ex emails the accountant that did our taxes all the time with questions. One of them being: if i do extra work how will it affect my tax bracket and, if so, how much can I earn before it changes my tax bracket? 

As knowledgeable as people are on here, I'd want to hear this kind of thing straight from a professional.   And if you are earning that kind of money in a side job and you don't have an accountant, I would love to know why. When I first came to Germany I worked as a freelancer. Earned almost nothing and my ex did my taxes. They weren't accepted. We had an accountant ever since then and while it wasn't cheap, it was worth it.  And if you are making that kind of money as side money, you probably can afford one.  

 

just my 2 cents

 

Thanks yes it is a good idea. I haven't found one English speaking yet but will start to search again.

 

I wanted to learn beforehand as much as possible before searching for tax advisor or accountant.

For the moment I was not doing any tax declaration in last 3 years and no one came after me so far. (didn't do it on purpose just being ignorant, worked on side website after work earning like 20000 euro extra per year)

Then someone told me hey look you need to do extra steps before can grow fully the extra business and earn more then 100k per year.

 

At that moment I started to post here. I thought that stuff happened automatically my payment providers or finanzamt just took the % tax like they do with brokers and investments and nothing to do

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On 5/6/2022, 8:45:02, klingklang77 said:

 

I am not an accountant, but I think your German friends are supposed to be reporting that money? I don’t know. 

They don't report it especially when they register in non EU countries.

Estonia is not the best example I gave but even there with attorney and privacy options they report nothing to Germany and earn 100-200 k extra per year deposited there and withdrawn with cards all over Europe.

 

Of course taxes are payed in Estonia or whatever other country is used so it is fully legal but just no trouble with Germany , krankenkase or bullshit like that.

As I live in Germany and am not very patient to setup such arrangements wanted a straight solution within Germany only.

 

But I will decide what to do after getting more information.

Thank you all for info so far

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On 5/6/2022, 8:41:53, klingklang77 said:

If your freelance income goes over what you make at your full time job, you will be responsible for ALL of your health insurance payments. That can get very expensive. If you are making 4000 freelance and 3000 your full time job, then you are responsible for paying about 700 to your Krankenkasse per month. 

 

Edit: I use public health insurance. At my age (45) it is not worth it to go to private now, IMO. I have heard private can be good for young people. 

 

Freelance is not worth the hassle, IMO. 

 

Thank you. This provides information that is useful to me.

 

Now I understand what people meant about KK changes when having extra income aside full time job.

 

So if I earn 50000 per year in a full time job, and on the side 100000 per year I have to pay every month 700 euro to Krankenkase.

That is fine for me then as I earn way more anyway and is fully legal and set up correctly. I can proceed to work in peace

 

Or I will look into options of creating one gmbh and with a company krankenkase has nothing to do with me as much as I understand the topic. I can be owner of company and dont pay myself any salary or krankenkase extra and take money as dividend once in the end of year

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AFAIK if your income from your side activity is only €20000/year it doesn´t make sense anyway to do it via countries like Estonia if you want to stay legal. You´d have to commission a company in those countries which comes with maintenance costs (accountant, translators, office space etc.) which make it worthwhile only if you make at least €50000/year through them. At least that´s the case for companies in Cyprus (where I´m living and gained some insight into how it works).

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6 hours ago, mitsmorri said:

They don't report it especially when they register in non EU countries.

Estonia is not the best example I gave but even there with attorney and privacy options they report nothing to Germany and earn 100-200 k extra per year deposited there and withdrawn with cards all over Europe.

 

Of course taxes are payed in Estonia or whatever other country is used so it is fully legal but just no trouble with Germany , krankenkase or bullshit like that.

As I live in Germany and am not very patient to setup such arrangements wanted a straight solution within Germany only.

 

But I will decide what to do after getting more information.

Thank you all for info so far

A person who is a tax resident of germany is legally required to file their taxes in Germany. This involves their world wide income. In my knowledge this is the case with most countries.

For eg, i am an indian citizen but I am a tax resident of germany . So I pay taxes for all my income in India and germany in Germany. The tax indian government collects from me can be reclaimed stating double taxation prevention treaty . Same vice versa.

 

There are financial data sharing system with eu countries , and also with non EU countries. Look up CRS and FACTA. 

Don't trust your contact s , either they don't know what they are doing , or they are playing with fire and committing a crime . 

But don't get disappointed , may be you can contact @PandaMunich to understand whats needed, who is a tax consultant and speaks english.

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2 hours ago, jubinjohn said:

A person who is a tax resident of germany is legally required to file their taxes in Germany. This involves their world wide income. In my knowledge this is the case with most countries.

For eg, i am an indian citizen but I am a tax resident of germany . So I pay taxes for all my income in India and germany in Germany. The tax indian government collects from me can be reclaimed stating double taxation prevention treaty . Same vice versa.

 

There are financial data sharing system with eu countries , and also with non EU countries. Look up CRS and FACTA. 

Don't trust your contact s , either they don't know what they are doing , or they are playing with fire and committing a crime . 

But don't get disappointed , may be you can contact @PandaMunich to understand whats needed, who is a tax consultant and speaks english.

 

That’s what I thought. As a resident of Germany, you have to disclose all worldwide income. Then depending on tax agreements, you have to pay tax on that or not. If his friends are not residents in Germany at the moment, then I don’t think they have to file a German tax return, unlike in the US where all residents have to file regardless of residency. 

 

 

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9 hours ago, mitsmorri said:

Thank you. This provides information that is useful to me.

 

Now I understand what people meant about KK changes when having extra income aside full time job.

 

So if I earn 50000 per year in a full time job, and on the side 100000 per year I have to pay every month 700 euro to Krankenkase.

That is fine for me then as I earn way more anyway and is fully legal and set up correctly. I can proceed to work in peace

 

Or I will look into options of creating one gmbh and with a company krankenkase has nothing to do with me as much as I understand the topic. I can be owner of company and dont pay myself any salary or krankenkase extra and take money as dividend once in the end of year

 

Don’t forget taxes and payments into the German pension. And you’ll need to hire an accountant. That 100,000 a year can easily turn into 50,000. 100,000 is probably taxed at 45% and with that amount your health insurance will be about 900 a month. And then you need to pay into the German pension system. I am not sure what happens to your full time job and if they take taxes out of that or not. 

 

Also if you become unemployed in both jobs, you will only get 60% on ALG1 of your full time job. Freelancers don’t qualify for ALG1. You would then go onto ALG 2 and that’s miserable. So I would count on putting a lot away in your savings. 

 

Freelance isn’t worth it unless you are a millionaire. Personally, I would aim to keep your freelance amount below 50,000. But then you still will have to deal with taxes. 

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