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Bogus self-employment — spot & avoid it
You're officially self-employed, but in practice you work like an employee — for a single client, with fixed hours, embedded in the team? That can be "bogus self-employment", with costly consequences for both sides. Here you'll spot the warning signs and what you can do. No prior knowledge needed. (Context: the German-speaking region — DACH.)
What is bogus self-employment?
On paper you're self-employed (your own invoices, no employment contract) — but in reality you work like an employee: taking instructions, fully integrated, dependent on one client. Authorities and social security can classify this as a hidden employment relationship. The consequence: social contributions can be claimed retroactively — often from the client, sometimes affecting you too. That's why legitimate clients want to avoid it just as much as you do.
The typical signs
Only one client
The vast majority of your revenue comes permanently from a single company. That's the strongest warning sign.
Subject to instructions
Fixed working hours, a prescribed place, detailed instructions on how you work — rather than only what should be delivered.
Integrated into the organisation
Company email, a seat in the team, internal tools, you appear to the outside like a staff member.
No own market presence
No own market appearance, no other clients, no own marketing — no one could recognise you as an independent business.
No entrepreneurial risk
No own equipment, no own capital, no chance of profit/loss from your own decisions — you carry essentially no business risk.
What you can do
1. Build several clients
The most effective protection. Working for several clients makes you clearly self-employed. Even a second or third client changes the picture.
2. Show your own market presence
Own website, own tools, own briefing materials, own invoice template. Appear visibly as your own business.
3. Bill for results
Deliver defined services/projects rather than mere attendance. "8 hours in the office" looks like an employee; "module X delivered" looks like a contract.
4. Keep contracts clean
A clear service or works contract without employee wording (no "holiday", no "working hours", no instruction clauses). The lived reality must match the contract.
5. When unsure, get your status checked
You can have your status officially assessed (in Germany, e.g. via a status determination procedure). Better clarity upfront than back-payments later.
Quick check: how high is the risk?
Tick what applies to your current client situation. Runs in your browser, nothing is stored or sent. This does not replace a legal assessment.
Guidance only — not a legal assessment. What counts is always the overall picture in your individual case.
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Common questions
What is bogus self-employment?
You're formally self-employed but in practice work like an employee for a single client — taking instructions and fully integrated. Social security and authorities can treat this as a hidden employment relationship, with back-payments for both sides. This is not legal advice.
How do I recognise bogus self-employment?
Typical signs: only one client, fixed working hours and place, integration into the team, no own market presence and no entrepreneurial risk. The more apply, the higher the risk. What counts is the overall picture, not a single sign.
How do I avoid bogus self-employment?
Build several clients, show your own market presence (website, own tools, own briefing), bill for results rather than attendance and keep contracts clean as a service/works contract. When unsure, request a status determination or ask a professional.
Related: Tax basics · Hourly-rate calculator · Retirement
aban news is a Swiss sole proprietorship and gives no legal, tax or social-security advice. All content is for general information and does not replace an individual assessment.