The step into self-employment requires courage, ambition and a lot of stamina. Comprehensive preparation is essential for the successful establishment of a company. After all, it is a long way from the business idea to the final step in setting up a business. Here you can find out which considerations are important and which official procedures are essential!
Important decisions before starting a business
There are many good business ideas. But in the detail of preparation are sometimes complicated and lengthy procedures. Founders who register their business without much thought often fail. Therefore, well thought-out solutions are important milestones for a successful market appearance already during the preparation of the business start-up. In addition to comprehensive expertise in the chosen industry, founders also need knowledge in areas such as taxes, law and accounting. In the download area you will find useful tips in our brochure „Successful start-up“.
1. starting a business: full-time or part-time?
Many employees wish to be their own boss, but have not yet dared to actually start a business. The step out of the secure employment relationship with the protection of the social insurances seems too daring-part-time self-employed is different. You continue to receive your usual salary and remain protected in the areas of health, pension and unemployment insurance. If you pursue your business idea part-time or as a housewife/ husband, you still have to register the business. Freelancers such as artists, authors or teachers should contact their local tax office. Tradespeople register the business with the trade office of the responsible municipality. The tax office then registers itself.The following points in particular must be taken into account:
Employer: Dependent employees are allowed to become self-employed on a part-time basis. The employer may only prohibit the establishment of the business if you compete with your boss or if your work suffers as a result of the self-employment.
Health insurance: The additional income you generate by setting up your own business is exempt from contributions if you set up your business as a sideline. It only increases your taxable income. However, you must prove to the health insurance company that you do not run your business as your main occupation. As long as you earn more as a salaried employee than as a self-employed person and do not work more than 18 hours per week in your own business, your social insurance contributions will continue to run through your regular employment. The earnings do not increase your social security contributions. If you are not self-employed full-time and have family insurance through your partner, you must not work more than 18 hours per week on a self-employed basis and earn no more than 365 euros per month. Otherwise, you must take out your own health insurance.
Small business regulation: With this exception for entrepreneurs with small turnovers, the state tries to reduce the effort. As a small business owner, you benefit from simplified accounting obligations, do not have to submit an advance VAT return and enjoy a price advantage over competitors with private customers because you do not have to pay VAT. In return, however, you are not allowed to deduct input tax. The small business regulation applies as long as the gross turnover of the previous year is below 22,00 euros and the turnover in the current year is below 50,000 euros. Please note that the turnover plus the sales tax due on it must not exceed the limit.
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The advantages of starting a business as a sideline
According to the surveys in the KfW (Kreditanstalt für Wiederaufbau) start-up monitor, more than half of all business start-ups are now carried out on a part-time basis. With this decision you are in good company.
– You retain the security of a regular income and have health insurance at no extra cost.
– Mistakes or even the failure of your start-up ideas will not threaten your existence.
– In addition, you are under less pressure to be successful and can gain experience in peace and quiet and slowly but steadily expand your self-employment.
– If sales remain correspondingly low, you will also benefit from the relief provided by the small business regulation.
– The disadvantages of starting a business as a sideline
The advantages of starting a business as a sideline can also turn into significant disadvantages.
– Some people need a correspondingly high level of pressure to be permanently ambitious, committed and thus successful.
– In addition, the fact that you are only self-employed on a part-time basis can scare off potential customers and clients. Many companies expect their business partners to be 100 percent involved and not tied to a main job most of the time.
– The reference to the small business regulation can also have a negative effect and lead to customers not perceiving you as a professional partner at eye level.
– In addition, some part-time business startups are doomed to failure because they require all of your labor and a lot of dedication.
– Therefore, before starting your own business, think carefully about whether you want to be self-employed full-time or part-time.