From registration to approval: how to navigate the bureaucracy as an entrepreneur

Founding and running a company involves numerous bureaucratic obligations. If you are not well prepared, you can quickly lose track of registrations, permits and tax requirements. But with the right strategy, you can minimize the bureaucratic burden and focus on the essentials - your business.

1. the first steps: company registration and trade license

Every business activity begins with official registration. However, the requirements differ depending on the type of company:

• Business registration: If you run a business (e.g. online store, café, craft business), you must register your business with the local trade office. You will usually need your identity card, a registration certificate and any permits for special activities (e.g. health certificate for catering).
• Freelancers & small business owners: If you take up freelance work (e.g. as a designer, consultant or doctor), you do not need to register your business. Instead, you register directly with the tax office.

Important tips:

• Find out in advance online whether you can register digitally. Many cities already offer this service.
• If you are unsure whether your business is a trade or is considered freelance, ask the Chamber of Industry and Commerce (IHK) or a tax consultant.

2. tax obligations: Tax office & tax number

After registration, the trade office automatically forwards your data to the tax office. Within a few weeks you will receive the Questionnaire for tax registrationin which you must state your expected income and your VAT liability, among other things.

Important points that you should clarify:

• Value added tax liability: If your turnover remains below €22,000 in the first year, you can use the small business regulation and do not have to charge VAT.
• Tax number & VAT ID: The tax number is required for your tax return, the VAT ID is important for trading within the EU.
• Trade tax liability: Companies with an annual profit of over €24,500 (except freelancers) must pay trade tax.

Practical tips:

•  Use an accounting program to manage your income and taxes properly right from the start.
• Ask a tax advisor if you are unsure - incorrect information can lead to problems with the tax office.

3. necessary permits & regulations

Depending on the industry, you may need special permits and authorizations. Here are a few examples:

• Gastronomy: Hygiene regulations, liquor license
• Craft: Entry in the register of craftsmen
• Online store: Data protection guidelines, imprint obligation
• Medicine & Care: Health certificate, special approvals

Practical tip:

• Check which regulations apply to your sector in your city or region. The Chamber of Industry and Commerce or the relevant public order office can help here.

4. social security & employee registration

If you want to hire employees, you must register them with the health insurance fund and pay social security contributions. Health insurance is also compulsory for you as a self-employed person.

Duties as an employer:

• Registration with the statutory health insurance fund
• Accident insurance via the employers' liability insurance association
• Compliance with minimum wage & labor law

Tip: If you are starting out on your own, check whether voluntary unemployment insurance for the self-employed makes sense.