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Business registration of your car wash – The starting signal into self-employment

If you want to set up your own business with a car wash, you have to submit a business registration. You can find out where and how this works and what you should pay attention to here.

What constitutes a business registration?

There are different kinds of self-employment, and not all require a business registration. With a car wash, however, you are not working as a freelancer, but as a business. Your activity should be

  • profitable
  • permanent
  • independent and
  • not be socially unworthy

Whether you actually make a profit or not does not initially matter for the registration of the business.

Where to register your self-employment

In most smaller towns the trade licensing office is located in the town hall, in large towns mostly in the local or district office. The easiest way to do this is to check the Internet beforehand to see how things are done in your hometown and find out which documents you should bring with you. You will also find a form to fill out with information about your business. You can also get this form at the trade licensing office, but you save yourself and the local officials a lot of time if you fill it out at home and bring it with you to the office. You may even be able to register online. But it's customary for you to make an appearance in person.

Bavaria, Rhineland-Palatinate and Hamburg have a separate regulation. Here you can register your trade not only at the trade licensing office, but also with the Chamber of Industry and Commerce, the Board of Trade or the Chamber of Crafts. However, the fees vary, so it is worth making the comparison in advance.

You have to pay a fee to register a business

You pay a fee when you register your business. The fee you have to pay can vary greatly from one place to another. The range goes from 15 to 65 euros. However, simply "forgetting" to register is not an option – in such cases, the authorities know little leniency and will fine you. Although you can still register retrospectively up to 60 months after commencing your business, in most cases this will not save you from the fine, which can be up to 1000 euros.
The documents for registering your business

Some documents are mandatory for the registration of a business. These are:

  • your identity card – or your passport along with the confirmation of registration
  • the completed form (purpose of the company, contact details, main or secondary trade?)
  • for a company: the articles of association (notarised) and the current extract from the commercial register
  • if applicable, your residence permit and work permit

Important, if you want the subsidy for setting up a business from the employment office!

If you receive 'ALG I' unemployment benefit, you may be entitled to a start-up subsidy from the employment office. Have this checked first, because it is too late after registration. You will only receive the subsidy if you have not yet registered your business.

Correspondence by post after registering your business

If you have registered a business, you will receive several letters within the next few weeks regarding your new situation.

The tax office will contact you and send you a tax registration form. Here you indicate what you expect to earn in the course of the first year. If you have prepared a business plan, you will already have figures that you can work with. Make sure that you do not set the numbers too low, otherwise you will have to pay a lot more in a year's time! If necessary, you will receive a new tax number from the tax office.

The employers' liability insurance association will contact you to enquire if you have employees and if you would like to become a member. This is voluntary – you are not obligated to do so, but would, for example, be protected by work protection law. 

The Chamber of Industry and Commerce ('IHK') will send you a registration form – filling it in is mandatory, here you are not free to decide. If you have entered your company in the commercial register, membership costs you 135.00 euros per year. If this is not the case, the fee is 40.00 euros per year.  In addition, there is an amount that goes up with increasing income. However, the IHK is lenient when setting up a business: You can be exempt from the amounts – entirely for two years and partially for another two years.

Summary: Registering a business takes time

Do not delay the registration of your business! Sometimes it can take a relatively long time to get an appointment. When attending this appointment, it is best to bring the completed information form about your business, which you can find on the website of the trade licensing office depending on your location. If you are already running your business but have not yet registered it, you may be fined according to the Trade Regulations. De facto, this is almost never the case with a short period of non-registration, but if you want to be sure and do everything right from the start, it is better to take care of the registration early. Since the fines depend on the goodwill of the officials handling your case, you may be unlucky and find yourself having to dig deep into your pockets.