German tax law basically knows a clear distinction between self-employed and non-self-employed activities. In addition to the Income Tax Act (EStG), this is also clear from § 2 paragraph 2 UStG. However, the borders can blur in individual cases, so that the tax office and social security institutions assume a so-called bogus self-employment. It sometimes has serious consequences.
First principle: When is a bogus self-employment?
As the name suggests, the bogus self-employment is a fundamentally entrepreneurial activity, but only for the sake of appearance actually independently exercised. One could also speak here of “employee-equal self-employed”. The legislator always assumes a bogus self-employment if, according to the individual structure of the employment relationship, more points speak for an employee activity than for an entrepreneurial activity.
The previously self-employed entrepreneur is then treated retroactively as an employee.
Literature, administration and case law have developed various test criteria. This can be used to determine whether a natural person is more likely to be employed or pursue an entrepreneurial activity. For example, some of these criteria are:
This article does not replace tax or legal advice in an individual case. Facts, current law, jurisdiction, documentation and implementation remain decisive.