Becoming self-employed as an artist: These are the possibilities

At the beginning, her art was probably just a hobby . Sometimes it stays that way. However, many artists dream of the art professionally one day, maybe even full -time.

So, at some point, you'll have to ask yourself whether you want to become self-employed as an artist and what options are available. We'll give you an introductory overview of your options.

Life from art: is that realistic?

You don't earn money in creative professions. Many people are convinced of this, and you probably hear this saying again and again when you talk about your dream of making a living from art. But this is a misconception, because there are a whole range of creative professions that are in demand and pay decently .

This applies not only to those employed , but also to those self-employed in the respective industry. This opens up even greater earning opportunities if you are successful. Theoretically, you can make a living from many different forms of art: photography , painting , writing, or fashion design are just a few examples.

In practice, however, it's all about mastering the challenges of self-employment, and, of course, the quality of your artistic work must be convincing. Then the answer to the question can be a resounding "yes": It is realistic to make a living from art.

Many creatives do indeed make significant compromises to achieve success. How can their situation be improved and the right levers be applied? A Deutsche Welle with Christoph Backes of the u-institut:

How does one become an artist and can one Living from art ?

PULS reportage editorial team around Teresa Fries, Hendrik Rack, Lukas Hellbrügge also asked themselves this question

It is not immediately independent

So, once you've gained some experience, are satisfied with the quality of your art, and feel confident enough to convince clients, it's worth considering self-employment. This is especially true when you (or want to) generate your first income from your art, as this is when you'll need to officially register it and pay taxes.

So at the latest now there is no longer a way around the jump into self -employment. However, different models are suitable. You can found part-time or full-time. In some cases, you have the choice between a trade and freelance . In addition, there is the selection of different legal forms .

All models come with specific tax and legal considerations. To make the right choice—at least for starters—you should answer the following questions:

Would you like to found full-time or part-time ones?

Becoming self-employed is a step that scares many people. After all, you're losing the secure income of being employed, and instead you have to acquire your own clients and manage all aspects of your business yourself. Especially if you have financial obligations like outstanding loans or supporting a family, you don't want to take such a risk.

Then it makes sense to start your business part-time. This way, you'll have a secure basic income from your permanent position and can build up your artistic independence on the side. If this one day generates a predictable and sufficiently high income, you can turn your part-time business into a full-time self-employment.

Being self-employed as an artist on a part-time basis brings many advantages, especially in terms of finances and insurance. However, it does mean having to juggle two jobs at once and not being able to fully concentrate on your art.

It is therefore crucial the advantages and disadvantages and find the model that best suits your life situation and personal needs.

Possibility	Description	Advantages	Disadvantages
Mainly	The main source of income and the focus of time are on artistic activity. As a self-employed person, I am fully liable for taxes.	Full concentration on art, no time constraints for projects, professional appearance, often greater credibility with grants and galleries.	High financial risk 📉 (no fixed salary), full responsibility for health insurance, pension and social security (possibly artists' social security fund), intensive acquisition pressure.
Part-time	The artistic activity is carried out alongside a permanent job (or other main activity). Income and time commitment are limited.	Financial security through the main income, social security (health insurance, pension) is guaranteed, less pressure, gradual adaptation to the market is possible.	Limited time and energy for art, conflicts with the primary employer (permission may be required), growth limitations due to fixed capacities, more complex tax separation.

Would you like to work alone or with business partners?

Another way to free up time and money is to work with a business partner. Although many artists start their own businesses and operate as sole proprietors, this isn't a requirement. You can, for example, rent a studio together with another photographer, or you can take on the artistic work while your business partner takes care of the organizational aspects.

You can therefore freely design such a collaboration and thus find a model that suits you optimally. This also applies to the legal form, because other variants can be considered alone for a common foundation.

Possibility	Description	Advantages	Disadvantages
Alone (sole proprietor)	You bear all rights and obligations yourself. This applies to most freelance artists.	Complete freedom of decision and control over the artistic direction, simple and cost-effective establishment (no share capital), all profit allocation to oneself.	Unlimited liability 🚨 with all private assets, sole responsibility for all tasks (administration, marketing, finances), lack of exchange/support.
With partner (e.g. GbR)	Establishment of a partnership under civil law (GbR) with one or more partners.	Distribution of risk and workload , synergy effects (artistic and administrative), higher start-up capital/more resources possible, mutual motivation and support.	Less artistic freedom (coordination required), potential for conflict in decisions or profit distribution, joint and several liability (each partner is also liable for the other's debts) ⚖️.

Would you like to register a business?

If you decide to start your own business, the question arises whether you need a business license if you're pursuing an artistic activity. Most artists can also register as freelancers. Freelance professions include painters, writers, and musicians, as well as many professions related to art, such as dance teachers, interpreters, and many more.

It's therefore worthwhile to examine each individual case to determine whether freelance work is a viable option . It offers several advantages over a business – however, you still need to register a business if you offer products or services that don't fall under the freelance category. For mixed forms, registering a business may therefore be the easier option from the outset.

status	Description	Advantages	Disadvantages
Freelancer (catalog job)	Applies to original artists (painters, musicians, sculptors, designers, writers, etc.) and other creative, imaginative activities with a high personal element.	No business registration with the trade office necessary, no trade tax liability 🥳, simple bookkeeping ( income surplus statement - EÜR) possible.	Difficulties in defining the boundaries of highly commercial or reproducible activities, no compulsory membership in the Chamber of Industry and Commerce (IHK).
tradesman	Applies to activities that not creative or strongly commercial (e.g. the sale of art supplies, the mass printing of T-shirts with your own motifs, pure art education).	Clear demarcation for mixed activities, commercial law securities (e.g. for retail stores).	Business registration required, trade tax liability 💸 (from €24,500 annual profit), double-entry bookkeeping (accounting) possible if thresholds are exceeded.

Would you like to start as a small business owner?

At the beginning of self-employment, income is often still manageable. Therefore, it can be worthwhile to start as a small business owner to reduce tax burdens. This means you don't have to pay trade tax, declare sales tax, and prepare a balance sheet or inventory at the end of the year—depending on your legal form, these points will be more or less relevant for you.

You can use this small business regulation as long as your total turnover did not exceed €25,000 in the previous calendar year and €50,000 in the current (second) calendar year. If the turnover limit is exceeded within a year, the small business regulation remains in effect until the end of the year. Standard taxation then applies from the following year (exception: if your net turnover exceeds €100,000 in the current calendar year, the switch to standard taxation takes effect immediately). This regulation is therefore particularly worthwhile in the early stages or for part-time self-employment. It should not be confused with a small business.

In addition to the turnover limits, there are other important points to consider when applying the small business regulation . While you are no longer required to display VAT on invoices, you have the option of not claiming input tax on services purchased. This means you cannot refund the VAT you pay on the purchase of materials or services, which is particularly noticeable with larger investments.

Another crucial aspect is the annual review of your sales. If you exceed the sales limits in one year, you will lose your status as a small business owner and will be required to pay sales tax the following year. Therefore, it's advisable to keep an eye on your income on a regular basis and, if necessary, consult a tax advisor early on to avoid unpleasant surprises.

In addition, in most cases it is advisable for creative professionals to consider insurance options through the Artists' Social Insurance Fund (KSK) in order to save on the employer's share of social security contributions.

Special regulations: Artists’ social insurance fund and small business owners

Artists' Social Insurance Fund (KSK) 🎨

• Advantage: Artists pay only about half of the contributions to health, pension, and long-term care insurance; the other half is borne by the federal government and the exploiters (galleries, publishers, agencies).
• Disadvantage: Only for full-time artists with a minimum annual income (currently €3,900), very strict examination and high bureaucracy during registration and entrance examination.

Small business regulation (KU)

• Advantage: Exemption from sales tax (VAT) for low annual sales (max. €22,000 in the previous year and expected max. €50,000 in the current year). Easy invoicing , as no VAT needs to be declared.
• Disadvantage: No input tax deduction 😥 possible (i.e. the VAT paid on purchases cannot be reclaimed from the tax office), making it difficult to work with business customers subject to VAT.

Comparison table for decision making

This table evaluates the most important criteria for a career starter:

criterion	Part-time / sole proprietor / freelancer (recommendation for beginners)	Full-time / Sole proprietor / Freelancer	Full-time / GbR / Businessperson
Financial risk	Low (existence secured)	High (it all depends on the art)	Medium to high (partner shares risk, but trade tax)
Bureaucratic effort	Low (EÜR, no trade tax)	Funds (EÜR, KSK application if applicable)	High (business registration, trade tax, GbR contract)
Social security	Fully guaranteed by main job	High expenditure (possibly KSK as contribution reducer)	High effort (like full-time job)
Tax liability	Unlimited (private assets)	Unlimited (private assets)	liable without limitation (private assets of the partners)
Growth potential	Limited (time capacities)	Very High (full concentration)	Very High (more resources and manpower)
Beginner recommendation	⭐ Very suitable! Start without pressure.	Suitable for existing customer base or heritage.	Only for larger, commercial projects with partners.

Success factors for self-employed artists

In addition to these legal and tax issues, you'll naturally need more to be successful as a self-employed artist. It's best to go through all the phases of starting a business , such as creating a business plan . While this isn't absolutely necessary for a successful start-up, it will make your start easier and increase your chances of success.

Furthermore, for any form of self-employment, it's important to have the right personality, in addition to the artistic and professional qualifications. Not everyone is suited to the unique characteristics and challenges of self-employment. It requires a certain willingness to take risks, for example, so you don't suffer from daily worries about the future. Other characteristics of an entrepreneurial personality are often described as follows:

• Emotional intelligence
• Extra version
• multitasking
• openness
• Organizational talent
• Self -discipline
• reliability
• VM

If you don't have all of these characteristics or would like to concentrate entirely on your artistic work, there are two alternatives to a sole proprietorship: Either you remain in a permanent position and start your business only part-time (if at all), or you look for at least one business partner - as mentioned above.

Hiring employees may also be an option once your self-employment is successful enough. This way, you no longer have to handle all tasks, from accounting to marketing, yourself. Nevertheless, as a self-employed person, you are and will remain the decisive figurehead for your business.

In contrast to starting a business in other industries, your economic success directly linked to your artistic achievements, and these cannot simply be delegated to other people.

Special considerations when working independently as an artist

You therefore need the will and self-confidence to market yourself professionally , to approach potential customers openly, and to establish business contacts. This applies both through modern online channels and the traditional approach of personal networks.

A business card, which also visually represents , should therefore always be handy. Because you never know where or when such contacts might arise. Being a self-employed artist is therefore, in the truest sense of the word, a full-time job.

If you do not have this willingness, a permanent position as an artist is often the more advantageous option.

If you've decided to become self-employed as an artist, whether full-time or part-time, you should seek individual advice. Certain artistic professions have special requirements , for example, regarding social security or the rights to your works. For example, you may be required to register with the artists' social security fund or be able to receive income from a collecting society.

The leap into independence therefore means a lot of bureaucracy at the beginning - but the effort is worthwhile to finally make your dream of living from art.