Can I get paid while doing a doctorate, and what's the difference between a scholarship and a paid position?

There are three main ways to fund a doctorate in Germany:

Paid position (Wissenschaftliche Mitarbeiterin): You work on an employment contract at a university or a non-university research institute. Pay is set by the public-sector collective agreement (usually TV-L). Positions are often part-time (for example 50% or 65%), but in practice your thesis is part of the job. You have health, unemployment and pension insurance. The job may also include teaching or project work.

Scholarship: DAAD, scholarship foundations or graduate schools pay a monthly doctoral scholarship. Scholarships are usually tax-free, but since there's no employment contract, there's no pension or unemployment insurance; you pay your own health insurance. You can devote more of your time to your thesis.

In a company or alongside a job: Some companies offer doctoral positions together with a university. It's also possible to do an external doctorate (externe Promotion) while working full-time, but it takes a lot of time and discipline.

Residence permit: With a paid position you usually get a researcher permit (§ 18d), or an EU Blue Card if the salary is high enough; with a scholarship or as an enrolled doctoral candidate only, you usually get a student permit (§ 16b).

Ask when comparing: How many years is the contract? Is funding guaranteed until you finish? How much teaching is involved? Does the scholarship include an allowance for health insurance?