How to Be a Freelance Developer in Germany

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Being a Python freelancer is a new way of living in the 21st century. It’s a path of personal growth, learning new skills, and earning money in the process. But in today’s digital economy, becoming a Python freelancer is – above everything else – a lifestyle choice. It can give you fulfillment, flexibility, and endless growth opportunities. Additionally, it offers you a unique way of connecting with other people, learning about their exciting projects, and finding friends and acquaintances on the way.

Disclaimer: Please don’t take this as legal advice but as tips & tricks from someone who’s been there and done that.

How to Be a Freelance Developer in Germany

Freelance Developer Germany Pros and Cons

So what are the advantages of being a freelance coder? Let’s dive right into them.

Advantages of Being a Freelance Programmer in Germany

  • Flexibility: One big advantage of being a Python freelancer is that you are flexible in time and space. I live in a large German city (Stuttgart) where rent prices are increasing. However, since I am working full-time in the Python industry, being self-employed, and 100% digital, I have the freedom to move to the countryside. Outside large cities, housing is exceptionally cheap and living expenses are truly affordable. I am earning good money matched only by a few employees in my home town — while I am not forced to compete for housing to live close to my employers.  A few cities demand very high prices in Germany while others allow you to get affordable and beautiful houses in the countryside. A clear advantage for freelance developers!
  • Independence: Do you hate working for your boss? Does your boss still value old-school values such as working 9-to-5? In Germany, a lot of bosses are that way. Being a freelancer injects a dose of true independence into your life. While you are not totally free (after all, you are still working for clients), you can theoretically get rid of any single client while not losing your profession. Firing your bad clients is even a smart thing to do because they demand more of your time, drain your energy, pay you badly (if at all), and don’t value your work in general. In contrast, good clients will treat you with respect, pay well and on time, come back, refer you to other clients, and make working with them a pleasant and productive experience. As an employee, you don’t have this freedom of firing your boss until you find a good one.
  • Tax advantages: As a freelancer, you start your own business. Please note that I’m not an accountant — and tax laws are different in different countries. But in Germany and many other developed nations, your small Python freelancing business usually comes with a lot of tax advantages. You can deduct many expenses from the taxes you pay, such as your Notebook, your car, your living expenses, working environment, eating outside with clients or partners, your smartphone, and so on. At the end of the year, many freelancers enjoy tax benefits worth tens of thousands of Euros. You can find a detailed tax guide here.
  • Business expertise: This advantage is maybe the most important one. As a freelancer, you gain a tremendous amount of experience in the business world. You learn to offer and sell your skills in the marketplace, you learn how to acquire clients and keep them happy, you learn how to solve problems, and you learn how to keep your books clean, invest, and manage your money. Being a freelancer gives you a lot of valuable business experiences. And even if you plan to start a more scalable business system, being a freelance developer is truly a great first step towards your goal. The business experience is a clear plus compared to other, more “nerdy” developers working only with code. The business skills will make you a more valuable person—even for established companies.
  • Paid learning: While you have to pay to learn at University—living is relatively expensive in Germany—being a freelance developer flips this situation upside down. You are getting paid for learning. As a bonus, the things you are learning are as practical as they can be. Instead of coding toy projects in University, you are coding (more or less) exciting projects with an impact on the real world. In Germany, the pay is relatively good due to the developed nature of the economy.
  • Save time in commute: Many Germans are stuck in commute for hours and hours every day. Being in commute is one of the major time killers in modern life. During a 10 year period, you’ll waste 2000-4000 hours — enough to become a master in a new topic of your choice, or writing more than ten full books and sell them on the marketplace. Commute time to work is one of the greatest inefficiencies of our society. And you, as a freelance developer, can completely eliminate it. This will make your life constantly easier, you have an unfair advantage compared to any other employee. You can spend the time on learning, recreation, or building more side businesses. You don’t even need a car (I don’t have one) which will save you hundreds of thousands of Euros throughout your lifetime (the average German employee spends 300,000 € on cars).
  • Family time: During the last 12 months being self-employed with Python, I watched my 1-year old son walking his first steps and speaking his first words. I was actually attending every single stage of his development and growth. While this often seems very normal to me, I guess that many fathers who work at big companies as employees may have missed their sons and daughters growing up. In my environment, most fathers do not have time to spend with their kids during their working days. But I have and I’m very grateful for this.
  • Competition: In Germany, there’s a seller’s market for freelance developers—demand is much higher than supply. This means that you can charge premium rates and work only on the gigs you want.

Are you already convinced that becoming a Python freelancer is the way to go for you? You are not alone. To help you with your quest, I have created the one and only Python freelancer course on the web which pushes you to Python freelancer level in a few months — starting out as a beginner coder. The course is designed to pay for itself because it will instantly increase your hourly rate on diverse freelancing platforms such as Upwork or Fiverr.

Disadvantages of Being a Freelance Programmer in Germany

  • Less stability: It’s hard to reach a stable income as a freelancer. In Germany, many people seek security above freedom. Also, if you want to buy your own home and need credit, banks usually have less trust in your ability to generate income than if you were employed.
  • Bad clients: You will get those bad clients for sure. However, in Germany this disadvantage is somehow mitigated as clients are mostly business owners that are able to pay their freelancing fees.
  • Legacy code: Germany has a lot of large and established industry players such as Bosch, Daimler, and other manufacturers. These older industries usually have older code bases as well. As a German freelance developer, you may need to handle more legacy code than as a freelancer in a newer economy such as, for example, India.
  • Solitude: If you are working as an employee at a company, you always have company, quite literally. In Germany, this culture is especially true—only a small percentage of your IT friends will work as self-employed freelance developers. Most coders work for big companies.

Freelance Developer Germany While Employed

If you’re an employee, you have the freedom to create your own side-hustle in Germany. However, there are some laws that ensure that people don’t work too much. Thus, you need to be careful not to work too many hours per week. In this resource, they recommend not to work more than 18 hours per week on your side business—if you still have a main job. In general, these are the points to consider when creating your own side-business as a freelance developer in Germany:

  • Side vs Main Income: Make sure to earn more in your main job than in your side business. This is required so that it still counts as a side-business and not your main income. In that case, your business would be considered your main income which would result in a loss of some benefits paid by your employer.
  • Inform Your Employer: You may need to inform your employer that you create your side business. This may be required by contract or even by law (for some type of jobs such as government employees).
  • Register Your Business: You need to register your business with the tax office and government. As in most other countries, you cannot just “go for it” but need to register your intent to create a business—even if it is on the side.
  • Social Insurance: If you’re creating a business on the side, you’re stilled insured by your employer (e.g., for pension funds and health insurance). That’s why you need to make sure not to work or earn too much for your side business. As soon as you cross this threshold and your “side” business becomes your primary income stream, you need to take care of insurance yourself and you’ll lose access to the benefits provided by the employer. (Well, if you reach this point, you essentially have a double income so you probably wouldn’t care financially.)
  • Tax: You need to make sure to pay all taxes (e.g., sales tax and income tax). However, suppose you don’t earn a lot with your side business. In that case, you’re probably eligible to apply for special tax treatment (“Kleinunternehmerregelung”) to free you from the need (partially) to pay sales taxes.

You can read more in this excellent online overview article.

Freelance Developer Germany Hourly Rate

Freelance developers in Germany earn more than their employed colleagues. A recent article from a German magazine states that the average freelance developer earns 84€ per hour. If you work 8 hours per day for a client, you’d earn 640€ per day or 13440€ per month.

Note that this is the average rate of a freelance developer! Most people can significantly increase their income by honing their business and programming skills at the same time—and reach above-average hourly rates over time. If you reach expert status in a certain area, you can charge 100€ per hour which results in a monthly income of 16000€.

Becoming a freelance developer in Germany is, indeed, a profitable endeavor!

Make sure to save some 10% of your income for more calm times to ensure liquidity at all costs. Cash is the lifeblood of any business and the sensible business owner makes sure to always have enough cash on their bank account to pay for at least 6 months of expenses.

To learn how to reach above-average hourly rates, join my Python freelancer course—the world’s most comprehensive and in-depth freelance developer program!

*** The Six-Figure Python Freelance Developer Course ***

Freelance Developer Germany Tax

There are two primary types of taxes for self-employed freelancers in Germany: sales tax and income tax.

  • Sales tax is between 16-18% of each transaction volume and if you sell your services to another business, you can usually deduct it again (ask your accountant)!
  • Income tax can easily reach 40% of your income if you reach the average earning levels of a German freelancer of a six-figure income.

However, if you’re just starting out and you’ve only a few or zero clients, you don’t have to pay either sales tax and income tax.

There are many ways to optimize your taxes and I recommend you check out our detailed tax guide (for hackers) to learn some smart ways to pay less tax and invest in your future success.

The Unofficial Freelance Developer Tax Guide [for Hackers]

Freelance Developer German Language

My friend and freelancer Lukas is involved in freelancing for German clients. He’s a German guy so he swears on using a German gig description on freelancing platforms such as Fiverr. The big benefit is that, as a person being able to speak the German language, you can shield yourself from international competition and price wars. Many German clients only seek freelancers who can speak German with them because they’re uncomfortable in expressing their needs and gig specifications in a foreign language such as English. Being able to speak German well can make your freelancing business even more profitable and better protected against the competition!

How to Compete with Low-Wage Workers as a Freelance Developer?

Where to Go From Here?

Enough theory. Let’s get some practice!

Coders get paid six figures and more because they can solve problems more effectively using machine intelligence and automation.

To become more successful in coding, solve more real problems for real people. That’s how you polish the skills you really need in practice. After all, what’s the use of learning theory that nobody ever needs?

You build high-value coding skills by working on practical coding projects!

Do you want to stop learning with toy projects and focus on practical code projects that earn you money and solve real problems for people?

🚀 If your answer is YES!, consider becoming a Python freelance developer! It’s the best way of approaching the task of improving your Python skills—even if you are a complete beginner.

If you just want to learn about the freelancing opportunity, feel free to watch my free webinar “How to Build Your High-Income Skill Python” and learn how I grew my coding business online and how you can, too—from the comfort of your own home.

Join the free webinar now!