Navigating Health Insurance as a Side Hustler: A Deep Dive for Germany’s “Kleingewerbe”
The rise of the “Nebengewerbe” – the side hustle – is a defining trend in Germany’s modern economy. From online shops and tutoring to dog walking and city tours, more and more individuals are supplementing their income with entrepreneurial ventures. But what does this mean for health insurance? Understanding the rules is crucial for anyone operating a “Kleingewerbe” or freelance business.
What Exactly is a “Kleingewerbe”?
A “Gewerbe” refers to any independent business activity conducted regularly and independently with the intention of making a profit. Gewerbetreibende (business operators) must register their activity with the relevant authorities and tax offices. A “Kleingewerbe,” still, is a commercial enterprise with a low business volume and without a commercially organized business operation. Unlike larger businesses, Kleingewerbe are not registered in the Handelsregister (commercial register) and can utilize the simplified Einnahmen-Überschuss-Rechnung (income surplus calculation) for their profit determination.
Kleinunternehmerregelung: Small Business, Big Implications
Both Gewerbetreibende (business operators) and Freiberufler (freelancers) can opt for the Kleinunternehmerregelung (small business regulation) at the tax office. This exempts them from charging Umsatzsteuer (value-added tax). However, it’s important to note that being a Kleinunternehmer is not the same as running a Kleingewerbe. The key factor is an annual net turnover limit of 25,000 Euro (as of 2025). A Kleingewerbetreibender can be subject to VAT even if they qualify as a small business, even as larger companies can utilize the regulation in low-turnover years.
Health Insurance Obligations for the “Kleingewerbe”
All self-employed activities, including Kleingewerbe, are subject to mandatory health insurance. Entrepreneurs can choose between the gesetzliche Krankenversicherung (statutory health insurance – GKV) and the private Krankenversicherung (private health insurance – PKV). Self-employed individuals must pay the full contribution rate to the statutory health insurance and Pflegeversicherung (long-term care insurance), based on their taxable income.
The Exception: Nebenerwerb (Secondary Occupation)
There’s a significant exception: if the Kleingewerbe is operated as a Nebenerwerb – alongside a primary job subject to mandatory insurance – you may not need to pay additional SV-Beiträge (social security contributions) for health insurance. To qualify, you must function no more than 20 hours per week in the Kleingewerbe and earn no more than 75% of your monthly salary from your main job. Having even one employee (with the exception of a single Minijobber) disqualifies you from this exemption.
Geringfügigkeit: The Low-Income Threshold
If your income from the Kleingewerbe falls below the Geringfügigkeitsgrenze (low-income threshold) – 603 Euro (as of 2026) – you may be eligible for free coverage through the Familienversicherung (family insurance) of your spouse or registered partner.
Future Trends and Considerations
The landscape of self-employment and health insurance is constantly evolving. Several trends are likely to shape the future for Kleingewerbe operators:
- Increased Digitalization: More side hustles will emerge in the digital space, potentially blurring the lines between employment and self-employment.
- Gig Economy Growth: The gig economy will continue to expand, creating more opportunities for individuals to engage in Kleingewerbe activities.
- Complexity of Regulations: Navigating the intricacies of tax and social security regulations will turn into increasingly challenging, potentially driving demand for specialized advice.
- Focus on Financial Literacy: Self-employed individuals will need to prioritize financial literacy to effectively manage their income, expenses, and insurance obligations.
FAQ
Q: What is the difference between a “Gewerbe” and a “Kleingewerbe”?
A: A “Gewerbe” is a general term for a commercial business, while a “Kleingewerbe” specifically refers to a small-scale business with a low turnover and simple operations.
Q: Can I use the Kleinunternehmerregelung if I have a Kleingewerbe?
A: Yes, but your annual turnover must not exceed 25,000 Euro (as of 2025).
Q: Do I have to pay health insurance contributions if my Kleingewerbe is a side hustle?
A: Not necessarily. If you work less than 20 hours per week and earn less than 75% of your main job’s salary, you may be exempt.
Q: What is the Geringfügigkeitsgrenze?
A: It’s the income threshold (603 Euro as of 2026) below which you may be eligible for free family health insurance.
Pro Tip: Keep meticulous records of your income and working hours to accurately determine your health insurance obligations.
Did you realize? The definition of “low business volume” for a Kleingewerbe isn’t strictly defined by a revenue threshold, but rather by the scale and organization of the business.
Ready to learn more about navigating the world of self-employment in Germany? Explore our other articles on health insurance for the self-employed and income surplus calculation.
