Self-employment by foreign nationals in Germany

This page provides an overview of the immigration regulations that third-country nationals must comply with in order to be able to take up self-employment in Germany. General information on starting a business can be found on our homepage on start up support.

1. Nationals of the European Union

Nationals of EU member states enjoy the freedom of establishment and the freedom to provide services within the European Union. The freedom of establishment includes the commencement and pursuit of self-employed activities as well as the founding and management of businesses. The freedom to provide services allows temporary provision of services in Germany under the same conditions as German nationals. A special work permit is not required. However, professional and trade regulations must be observed. For craft-related activities, it is advisable to consult the relevant Chamber of Crafts.

2. Self-employment by Nationals from Third Countries

Third country nationals require a residence permit for staying in Germany and taking up self-employment, which must explicitly permit this activity. For self-employment, a residence permit pursuant to Section 21 of the Residence Act (AufenthG) is generally required. This permit must, as a rule, be applied for before entering Germany at the competent German mission abroad (embassy or consulate). If the person is already resident in Germany, the application may be submitted to the competent local immigration authority under certain conditions.
Important: The residence permit must be obtained before self-employment begins. Without a valid permit, this constitutes a violation of applicable law, which may have legal consequences. Further information can be found on the homepage of the German Customs Authority.
Nationals of the so-called “Best Friends” countries (e.g. Australia, Japan, Canada, New Zealand, UK, and USA) may enter Germany without a visa and apply for the residence permit at the local immigration authority. Note: Although entry is visa-free, the commencement of (self-)employment is only permitted with a valid residence permit. Due to possible waiting times, it may be advisable to apply for the applicable visa whilst still abroad. Individual consultation is recommended.
As the procedures are often lengthy, we recommend careful planning and consideration of the processing time in your business planning.

3. Requirements for Granting a Residence Permit for the Pursuit of Self-Employment

The legal basis is Section 21 of the Residence Act (AufenthG). In most cases, Section 21 (1) applies; for freelance activities, Section 21 (5) applies. We recommend seeking legal advice to clarify whether your activity is considered freelance under tax and trade law. The English term “freelancer” does not automatically correspond to the German term “Freiberufler”.
For self-employed commercial activities, the following requirements apply under Section 21 (1) AufenthG:
  • There is an economic interest or a regional need,
  • The activity is expected to have positive effects on the economy, and
  • Financing is secured through equity or a loan commitment.
All three requirements must be met. The assessment is based on the viability of the business idea, entrepreneurial experience, capital investment, impact on employment and training, and contributions to innovation and research.
Persons over the age of 45 must also provide proof of adequate retirement provision.
Depending on jurisdiction, chambers of industry and commerce, trade authorities, professional associations, and licensing authorities are involved in the review process. In the Stuttgart area, the immigration authority involves the IHK Region Stuttgart and requests a statement.
The final decision on the application is made at the discretion of the immigration authority.

3.1. Self-Employment / Target Group

The term “self-employment” is not legally defined. It is determined by distinguishing it from dependent employment. A relevant criterion from case law is whether the activity is carried out in personal dependence based on an overall assessment of all circumstances of the individual case. If the activity is carried out independently, the business is organized autonomously, and dealings with clients are conducted independently, the activity is generally considered self-employed.
Typical examples of self-employed activities:
  • Sole proprietors (commercial or freelance)
  • Partners in partnerships (OHG, KG, GbR)
  • Managing directors of legal entities (AG, GmbH, cooperative, KGaA), if they hold more than 50% of the shares or act with entrepreneurial responsibility
A pure capital investment is not sufficient to be considered self-employed under Section 21 AufenthG.
For managing partners in partnerships, it is crucial whether they are actually in a managerial position and have been appointed to represent or manage the company according to the law or the partnership agreement.
If questions arise in this regard, we recommend seeking legal advice before submitting the application.

3.2. Required Documents

For the IHK assessment based on the legal requirements of Section 21 (1) AufenthG, the following documents are required. These should ideally be submitted with the application to avoid delays due to additional requests:
  • For new businesses: A well-founded, concise business plan (max. 25–40 pages), including concept, revenue forecast, investment plan, and capital requirements plan. The business plan should clearly outline what you intend to do in Germany and how you plan to implement and finance your project.
  • For existing businesses: Instead of a business plan, a detailed activity description with business-related financial information on viability (e.g., balance sheets, annual financial statements) is sufficient.
  • Extract from the commercial register (Handelsregisterauszug) – if available
  • Trade registration (Gewerbeanzeige) – if already completed
  • Partnership agreement (if applicable, draft version acceptable)
  • Proof of capital (equity/loan) – it must be clearly demonstrated that financing for the next 6 months is secured
  • CV with proof of qualifications and professional background
  • Managing director employment contract with salary information – if applicable
  • Lease/rental agreements (if available)
  • Proof of business relationships in Germany/Europe

4. Special Regulations for Certain Groups

4.1 International Agreements

Germany has concluded international agreements with the following countries, which may justify exceptions to Section 21 (1) AufenthG in individual cases through most-favored-nation and goodwill clauses: Dominican Republic, Indonesia, Iran, Japan, Philippines, Sri Lanka, Turkey and USA. Nationals of these countries may be granted a residence permit under Section 21 of the Residence Act regardless of the requirements of paragraph 1. This possibility is reviewed by the competent authority.

4.2 Graduates of German Universities, Section 21 (2a) Residence Act

Foreign nationals who have completed a degree at a state or state-recognized university in Germany, or who hold a residence permit as a researcher or scientist, or a residence permit under Sections 18b, 18d, 19c (1) Residence Act, or a Blue Card, are generally granted a residence permit for self-employment deviating from Section 21 (1) AufenthG. Requirement: the intended self-employment must be related to the studies or research.

4.3 Third-Country Nationals with Another Residence Title, Section 21 (6) Residence Act

Foreign nationals who already hold a residence permit for another purpose may additionally be granted permission for self-employment – without having to meet the requirements of Section 21 (1).
Note: A “Duldung” (temporary suspension of deportation) is not sufficient.
For regulated professions, the respective requirements must be met, e.g., a professional practice permit.
Note: This information has been compiled with care. However, no guarantee can be given for its accuracy.
Status: October 2025