German taxman

[daisey57]

My colleague contracted in Germany for 10 months via a UK agency which paid him into a DE account. There was no mgmt or middle company. He told the agency that he's a freelancer in DE but he never registered in Germany, didn't have a flat, gym membership, DE phone or internet and stayed in holiday apartments.

Basically, lived as a ghost.

Other Brit colleagues did this for 2+ years without any trouble which originally led him to do this.

Will he get caught ? Can UK agencies get audited by Finanzamt to provide invoices?

As for the German client, they have no record he worked there. They were invoiced by the UK agency

[borderreiver]

Second thread about "your colleague" ... "he" must be getting nervous

I would doubt there is much chance of "him" getting caught but presumably there was an end client in DE where the work was done, and if audited it could lead a trail back to you^H^H^H "him" ...

[daisey57]

The key question is:

Do UK agencies get audited by or provide info to the F-amt ?

[BlasterBates]

Well it would be the invoices at the client they might see. They normally would have your friend's name on, they might chase it up from there.

If your friend was in Germany in the last year or two he can probably still submit a tax declaration without any penalties, I wouldn't have thought they wouldn't impose anything more than small fine if that.

As a Freiberufler he didn't need to register officially, the quirk of law is that "freelancers" don't have to register businesses. So in the event that your friend decides to tax this in Germany I wouldn't expect any bother about the fact he didn't register straight away. The fact that he was returning to the UK and living in hotels mean he was never resident in Germany, but is liable for the tax on the contract.

So an option would be to contact an accountant or Steuerberater to straighten things out.

In terms of tax there is not much difference between UK tax and German tax, so it wouldn't be worth taking a risk with the German authorities to save tax. Double taxation treaty means in the UK they would take into account tax paid in Germany.

If he doesn't pay tax, after 10 years he's in the clear, as they don't go back any further than that.