Who reports what to whom: trade office, municipality and tax office

A beautician opens her studio in Leipzig on 31 March 2026. That morning she went to the trade office, the confirmation is in her drawer, and now she is waiting for a letter from the tax office. In June she writes her first invoices, €3,400 in total, without a tax number, because none has arrived. It never came, because the tax office was still waiting for something from her: the questionnaire, due since the end of April.

Two statutes, two notifications

Anyone going self-employed in Germany registers twice, under two different statutes. The Trade Regulation Act (GewO) requires a notification to the trade authority. The Fiscal Code (AO) requires a notification to the tax administration and, on top of it, further information to the tax office. Each duty has its own addressee, its own timing and its own consequences.

Their purposes explain the split. Under § 14(5) GewO, the data in a trade notification may only be processed to supervise the carrying on of trades and for statistics. The tax office, by contrast, needs information from which it can assess taxes: the kind of activity, expected turnover and profit, the legal form and the people involved.

The trade authority shares its data. § 14(8) GewO lists the bodies it regularly passes data to, among them the chamber of industry and commerce, the chamber of crafts, the accident insurance and, in item 13, the tax offices competent under § 22 AO. That item, however, carries a proviso: without prejudice to § 138 of the Fiscal Code.

That proviso is the core of this first module. The fact that the trade office informs the tax office does not replace the founder's own tax duty. The beautician in the opening story had done one notification and thought the other one unnecessary. This exact confusion regularly costs founders their first months of invoicing.

The trade notification: at the same time as the start

§ 14(1) sentence 1 GewO requires anyone who starts the independent operation of a fixed-site trade, a branch or a dependent branch office to notify the competent authority. The provision sets no period in days. It requires the notification at the same time as the start, so neither weeks before nor weeks after.

Which authority is competent is a matter of state law; what is meant is the trade authority where the business is located. The content of the notification is governed by an ordinance under § 14(14) GewO. It specifies in particular which information must be given, and it may prescribe forms and lay down how they are designed.

The duty does not end with the opening. Under § 14(1) sentence 2 GewO a notification is equally required when the business moves, when the object of the trade changes or is extended to goods or services not customary for it, when the trader's name changes, and when the business is given up.

A move into another registration district is simplified: the notification goes only to the authority of the new location, which forwards the data without delay to the previous one. A trader who forgets to deregister, although the closure is clearly established, may be deregistered ex officio after a reasonable period.

Failing to notify is an administrative offence under § 146(2) no. 2 letter b GewO, and negligence is enough. The same applies to a notification that is incorrect, incomplete or late. Under § 146(3) GewO, the fine in these remaining cases of subsection 2 can reach one thousand euros.

Liberal professions: no trade office, straight to the tax office

Not every self-employed activity is a trade. § 18(1) no. 1 EStG describes the liberal professions: independent scientific, artistic, literary, teaching or educational work, plus a long list of catalogue professions, from doctors and architects to journalists, interpreters and translators, together with similar professions.

Trade law has traditionally not treated the liberal professions as trades, and § 6(1) GewO expressly excludes a number of professions from the scope of the Trade Regulation Act, such as lawyers, notaries, auditors and tax advisers. A trade notification under § 14 GewO is therefore not required for these activities.

For tax purposes, § 138(1) sentence 3 AO sets the route expressly: whoever takes up a liberal profession notifies the tax office competent under § 19 AO. As a rule this is the residence tax office, in whose district the taxpayer lives. No municipality sits in between on this route.

The classification reaches far beyond registration. Under § 2(1) GewStG, trade tax applies to a fixed-site commercial business. Conversely, § 2(2) GewStG treats the activity of a corporation always and in full as a commercial business. A GmbH formed by architects is therefore liable to trade tax, whereas the individual architect practising a liberal profession is not.

The boundary is not always sharp. If a consultant also sells goods on the side, that trading is not an activity from the catalogue in § 18 EStG. The questionnaire should therefore describe the activity precisely enough for the tax office to classify it itself, instead of having to guess from a single keyword.

The tax notification under § 138(1) AO

For traders, the tax notification runs through the municipality. Whoever opens a commercial business or a permanent establishment reports it, under § 138(1) sentence 1 AO, on the officially prescribed form to the municipality where it opens. The municipality informs the tax office competent under § 22(1) AO of the content without delay.

That tax office assesses the trade tax base amount. § 22(1) AO refers to the business tax office in § 18(1) no. 2 AO, the office for the district where the management is located. Where assessing the real property and trade taxes has not been delegated to the municipalities, sentence 2 puts a tax office in the municipality's place.

The same duty applies to opening an agricultural or forestry business. Sentence 4 extends it to moving or giving up a business, a permanent establishment or a liberal profession. Anyone who moves to another town or closes down must notify again, for tax as well as for trade purposes, each time under its own provision.

Subsection 1a opens another channel. Entrepreneurs within the meaning of § 2 UStG may additionally fulfil their notification duties under subsection 1 electronically with the tax authority responsible for their VAT. The statute says “additionally”: it creates a second route without abolishing the route through the municipality.

The questionnaire: additional, electronic, within one month

The real work lies in subsection 1b. Whoever must report the opening of a business or the start of a liberal profession under subsection 1 sentences 1 to 3 must also inform the tax office about the legal and factual circumstances relevant to taxation. That information is the tax registration questionnaire, the Fragebogen zur steuerlichen Erfassung.

The format is prescribed. The information must be sent as an officially prescribed data record through the officially designated interface (§ 138(1b) sentence 2 AO), which in practice means My ELSTER. Paper is the exception: it is only possible if the tax office, on application, waives electronic transmission to avoid undue hardship.

The deadline is in subsection 4. Notifications under subsections 1, 1a and 1b must be made within one month of the reportable event. The event is opening the business or taking up the activity. Neither a letter from the tax office nor the first invoice starts the period running.

The period is computed under § 108(1) AO using the Civil Code. The day of the event is not counted (§ 187(1) BGB). The period ends on the day of the following month bearing the same number (§ 188(2) BGB), and if that day does not exist, on the last day of that month (§ 188(3) BGB).

For the beautician in the opening story this means: opening on 31 March 2026, there is no 31 April, so the period ended on Thursday, 30 April 2026. Where such a period would end on a weekend or public holiday, § 108(3) AO makes the following working day the last day instead.

Very small activities can be exempted. Under § 138(1c) AO, the Federal Ministry of Finance may, by a letter published in the Federal Tax Gazette, exempt activities from the notification and information duties where they have no or only minor tax effect. Without such an exemption the duty stands.

Three questionnaires for three legal forms

For new businesses, ELSTER does not offer a single questionnaire but one per legal form. Which one fits depends on the legal form of the new business, not on its sector. Choosing the wrong one means answering questions that do not suit the situation and skipping the ones that matter for the chosen legal form.

For sole traders, ELSTER requires the start of a commercial, liberal-profession or agricultural and forestry activity. It is one form for all three types of income. The switch between municipality and tax office is not set by the questionnaire but already by § 138(1) AO, depending on whether the founder starts a trade or a liberal profession.

For a partnership, the questionnaire also asks about the partners, their shares and the agreements between the partnership and its partners. What follows from this for tax, in particular the joint determination of profit and the partnership's own trade tax, is explained step by step in the guide to the partnership questionnaire.

Corporations fall under a provision of their own. Under § 137(1) AO, taxpayers that are not natural persons notify the tax office competent under § 20 AO and the municipalities that levy the real taxes of the circumstances relevant to their tax registration, in particular formation, acquisition of legal capacity, change of legal form, relocation of seat and dissolution.

Here too the period is one month (§ 137(2) AO), and it runs separately for each event. Formation by notarial deed and acquisition of legal capacity are named separately in the statute. Anyone who waits for entry in the commercial register before notifying has therefore often let the period for the formation lapse already.

The corporation owes the questionnaire information through § 138(1b) sentence 4 AO, which extends sentences 1 to 3 to taxpayers under § 137 that are not already obliged to notify under subsection 1. Whether to form a GmbH or a UG in the first place is covered by the course on choosing between the two.

Which tax office is competent

Competence follows the tax concerned. For the income tax of a natural person, § 19(1) AO designates the residence tax office. For the trade tax base amount, § 22(1) AO designates the business tax office at the place of management. For corporations, § 20(1) AO also looks to the place of management.

Home and business are often in the same town but not always in the same tax office district. Where the municipality of residence belongs to several tax offices and the business lies in the district of one other than the residence office, § 19(3) AO makes that other office competent for income tax as well.

On the sole trader questionnaire, ELSTER states expressly that local competence for taxing the newly founded business depends on the place from which the business is managed, and asks users to bear this in mind when selecting the tax office. What counts is the place from which the business is run.

For a liberal profession, however, § 138(1) sentence 3 AO names the tax office competent under § 19 AO. Where a freelancer lives in one district and works in another, a short query to the tax office before submitting is worthwhile. A misaddressed questionnaire is forwarded, but it costs time that is missing from the one-month period.

When the notification is missing

Under trade law, as we saw, a fine is possible. Under tax law the situation is built differently. § 379 AO lists as an offence the missed foreign-investment reports under § 138(2) AO, but not the notification under subsection 1 or the information under subsection 1b. For these duties, the tax administration uses a different tool.

When the tax office requests the questionnaire, it issues an administrative act requiring an action. Under § 328(1) AO such an act can be enforced by coercive means, namely a coercive fine, substitute performance or direct force. Under § 329 AO a single coercive fine may not exceed 25,000 euros.

The costlier damage lies elsewhere. Without a tax number an invoice lacks a mandatory item: § 14(4) sentence 1 no. 2 UStG requires the tax number issued by the tax office or the VAT identification number issued by the Federal Central Tax Office. An invoice without one of these numbers does not meet the requirements of § 14(4) UStG.

And tax duties do not wait for registration. The duty to file advance VAT returns is tied to the return period, not to the day the tax number arrives. A founder registered late catches up on the first advance returns all at once, with all the payments at the same time.