Small business (Kleingewerbe)
Also: Kleingewerbe, Kleingewerbetreibender, small trader
In short
A small business (Kleingewerbe) is a trade that, by its nature or scope, does not require a commercially organised operation and therefore does not have to be entered in the commercial register. It is not the same as the small business VAT exemption.
Small business (Kleingewerbe) explained
Small traders are not merchants within the meaning of the HGB (Sec. 1 (2) HGB), but can register voluntarily and then become merchants (Sec. 2 HGB). The HGB does not set a fixed turnover limit for a small business. It is registered with the trade office like any trade, as a sole proprietorship or as a GbR. You usually determine profit with cash-basis accounting; you only have to keep books if you generate more than €800,000 turnover or €80,000 profit and the tax office notifies you of this (Sec. 141 AO). Whether you show VAT depends solely on whether you use the small business VAT exemption.
