This article is adapted from the business magazine Capital and is available here for ten days. Afterwards it will only be available to read at Like stern, Capital belongs to RTL Deutschland.

Keeping the children entertained, caring for the elderly father-in-law, keeping the house clean – there is a lot to do within your own four walls and you can rarely do it all alone. It’s good when professionals help. In more than 4.3 million German households, household helpers take care of things like cleaning or shopping.

But less than ten percent of private households register their supporters with the mini-job center or social security, according to figures from the German Economic Institute (IW). The remaining 3.94 million households apparently employ caregivers, babysitters and cleaning staff on a black basis, without any insurance and below the radar of the tax office.

Reason for the large shadow economy in private households: Both sides often shy away from contractual obligations and bureaucratic hurdles that a legal employment relationship supposedly entails. “There are many advantages to officially registering domestic help,” says Lena-Marei Ardelt from Quitt, a service platform for the legally secure registration and management of private employment relationships.

At least registering a domestic helper with the mini-job center has been quite uncomplicated for years and can be done online, by telephone and by post. All you need is some personal information. Private employers then pay low taxes of a maximum of 14.94 percent for their mini-jobbers in addition to their wages: flat-rate contributions to health, accident and pension insurance, levies and a flat-rate tax.

For example, if a mini-jobber in a private household earns the maximum monthly amount – 538 euros – this costs the private employer around 80 euros additional. The Minijob headquarters collects the additional costs from the employer using direct debit, forwards contributions, levies and flat-rate taxes to the responsible authorities and prepares reports for pension and accident insurance. At the same time, households can claim the costs of their household help for tax purposes. The tax office deducts 20 percent of the total expenses, a maximum of 510 euros per year, directly from your tax burden.

“It becomes more complicated when household helpers are supposed to receive more wages than the mini-job limit allows,” says expert Ardelt. A classic example is parents who want to hire a nanny for 10 hours a week to always pick up the children from daycare on time. With an average hourly wage of 18 euros, the gross monthly salary is 780 euros, which is in the so-called midi-job range. This is subject to social security contributions. Specifically, this means: household help and employers pay contributions to health and nursing care insurance as well as pension and unemployment insurance.

This means more work for private employers: For example, they have to register with the responsible statutory accident insurance provider and need a company number from the Federal Employment Agency. You do not register your domestic help, who is subject to social security contributions, with the mini-job center, but with your respective health insurance company, which collects the social security contributions. You must inform the tax office, prepare pay slips and, if necessary, pay wage tax according to the electronic wage tax deduction features.

“The effort is enormous and can hardly be implemented independently by private individuals,” says Ardelt. Some of these tasks can be carried out by external service providers such as tax consultants or payroll offices. Or private households hand over all responsibilities to all-round providers who take care of all legal tasks and ensure correct employment, insurance and professional administration.

However private employers organize the organization, there is also a tax discount for household helpers who are subject to social security contributions: the tax office reimburses 20 percent of the costs, although the annual maximum amount is a whopping 4,000 euros.

Their customers also want to avoid effort, reports Ardelt from the Quitt service portal. The majority of them are women. Raising children, caring for relatives and doing household chores is still often their job, as figures from the Federal Ministry for Family Affairs confirm: women spend an average of 43.8 percent more time per day on unpaid care work than men, 77 minutes to be exact. “Many of our customers can only do their own job if they have support at home.” Accordingly, fairness is important to Quitt customers: “They want to hire their help at home correctly, pay fairly and give vacation and sick days, just as they are used to.”

If private households have black people clean, look after or care for them, they are taking on considerable risks. Undeclared work is illegal. Anyone who is found out must, for example, pay additional social security contributions or pay for treatment costs if the assistant has an accident at work. In addition, you sometimes commit a criminal offense and have to expect fines.

Working secretly is also tricky for an assistant. She is also threatened with legal trouble and, for example, foregoes insurance coverage, continued payment of wages in the event of illness, paid vacation and does not acquire any pension rights.