In 2021, I built the job board Arbeitnow while also working full time as a software engineer for a company. When I wanted to run it as a business and potentially make money out of the job board, I had to ensure that I was allowed to do this and I did my research on this. Some call this side hustle, business, side project or part time but all of it should fit.
Things I did for self employment
Ask my employer for permission about additional activity (Nebentätigkeit)
I wrote them an email at the start of my probation period mentioning that I would be interested in additional activity, that it would not affect my focus on full time employment. They sent me a letter mentioning that the company has no issues about it. As long as I spend reasonable amount of hours on the additional employment (a maximum of 5-10 hours weekly, roughly 20% of hours weekly), there should not be an issue.
Check my visa if I am allowed to do self employment
On the back of my Zusatzblatt that came with the blue card, it mentions that I can do Erwerbstätigkeit gestattet (additional employment allowed). Eventually, I got Niederlassungserlaubnis (Permanent Residence) which also allows me to do this.
Check with Health Insurance
This was a check I did voluntarily with my Krankenkasse, any additional money that I make from the job board would not affect how much my health insurance premiums or monthly payments.
Register with the Berlin state as a business
I had to do Gewerbeanmeldung (Registering your business) so I can file my taxes properly. Fill this form as well - Fragebogen zur steuerlichen Erfassung. I also chose to get a VAT number and not to charge VAT as a Kleinunternehmer (small business) as long as I expected to make less than 22.000€ revenue in a year. I could do this registration online (surprisingly) and I had only around 15€ for the fees.
The business name would be the same as my full name and I did not have to register as a GmbH or UG, etc. I got the registration done and received a letter in under 2 weeks. A little bit later, the Finanzamt sent me a letter with the VAT number and confirmation that I did not have to charge VAT.
I submit my Einkommensteuer (income tax declaration) for my full time job. I used to use Taxfix for this but I don't use them anymore, as they don't support reporting additional income.
For the business, I write up invoices specifying these:
Full name and address of mine and the business / person I am charging
VAT Number of mine and the business / person I am charging
That I don't charge VAT because of the small business rule using this line at the bottom of all of my invoices
Im ausgewiesenen Betrag ist gemäß § 19 UStG keine Umsatzsteuer enthalten
The amount shown does not include sales tax in accordance with § 19 UStG (German sales tax law)
Make sure that your invoice is fully compliant, I use Stripe to send invoices and collect money
For accounting, I started using SevDesk for managing my receipts / expenses and I hired a Steuerberater to help me file the taxes. They love using any accounting system and SevDesk works well for me because of their website & support in English.
I have reached out to them several times asking for help or clarification and I was pleased with their response. You know you reached a human for help and someone took their time to help sort it out.
I also use a dedicated business bank account by N26. This is optional but it helps me to keep my revenue, expenses separate and it's easier when it comes to accounting season. I use this account exclusively for self employment. They don't have any detailed accounting but it connects well with SevDesk and all my transactions are automatically transferred.
For 2022, I had to file these five documents in total for taxes:
Einkommensteuererklärung ohne Ermittlung der Einkünfte
Überschussermittlung aus nichtselbstständiger Arbeit
Überschussermittlung aus Gewerbebetrieb
Erklärung zum Gewerbesteuer