Tax Guide · Scenario
Tax Guide for Indian Freelancers & Selbstständige in Germany
Freelancing in Germany as an Indian means navigating Freiberufler vs Gewerbe registration, the Kleinunternehmer threshold, and the EÜR — plus DTAA on any Indian-side income.
Why this scenario is different
Freiberufler (knowledge work — IT, consulting, design, translation) is exempt from Gewerbesteuer; Gewerbe (everything else) isn't. Both file Anlage S (or Anlage G), submit an EÜR (Einnahmen-Überschuss-Rechnung) under § 4 Abs. 3 EStG, and pay Einkommensteuer at marginal rates. Kleinunternehmer regime (under €25,000 turnover in 2025) waives VAT collection, simplifying invoicing for clients.
Key considerations
- IT/consulting/design = Freiberufler (Anlage S) — no Gewerbesteuer, simpler tax setup
- Other freelance work = Gewerbe (Anlage G) — Gewerbesteuer applies above €24,500 profit
- § 19 UStG Kleinunternehmer: under €25,000 turnover (2025 threshold) → no VAT, no Umsatzsteuer-Voranmeldung
- Vorauszahlungen (quarterly tax pre-payments) are based on prior-year profit — first-year freelancers often don't pay any
- Indian-side freelance income while resident in Germany → DTAA Article 14 (independent personal services), Anlage AUS
Refund-maximising tactics
- Office equipment GWG (Geringwertige Wirtschaftsgüter) under €800 → full deduction in year of purchase
- Home office Arbeitszimmer or Tagespauschale (€6/day) — choose whichever is higher
- Health insurance contributions are Sonderausgabe (full Krankenversicherung deductible)
- Travel + meals on client visits → Verpflegungsmehraufwand pauschale, no receipts needed
Related guides
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