• Visitors can check out the Forum FAQ by clicking this link. You have to register before you can post: click the REGISTER link above to proceed. To start viewing messages, select the forum that you want to visit from the selection below. View our Forum Privacy Policy.

Contracting in Germany via German umbrella company

Collapse
X
  •  
  • Filter
  • Time
  • Show
Clear All
new posts

    Contracting in Germany via German umbrella company

    I've been approached by an agency about a contract that involves 2-3 days of work in Germany and the rest here / WFH. The agent said they operate via a German umbrella company, which will pay me net of all German taxes and social security, and the payments will be made to my personal bank account.

    He mentioned that I'd retain just over 70% of my daily rate after all taxes.

    Does this sound legit? I've searched for the agency name here but found no match. The last thing I need is working with a dodgy umbrella co and being chased by two sets of tax authorities.
    Last edited by OneManBand; 12 March 2019, 13:04.

    #2
    Originally posted by OneManBand View Post
    I've been approached by an agency about a contract that involves 2-3 days of work in Germany and the rest here / WFH. The agent said they operate via a German umbrella company, which will pay me net of all German taxes and social security, and the payments will be made to my personal bank account.

    He mentioned that I'd retain just over 70% of my daily rate after all taxes.

    Does this sound legit? I've searched for the agency name here but found no match. The last thing I need is working with a dodgy umbrella co and being chased by two sets of tax authorities.
    You definitely won’t be getting 70% - search for a German income tax calculator and input your monthly figures (minus umbrella charge) It would be the ‘safest’ as you won’t need to worry about the German tax authorities because you’ll be paying PAYE.

    Comment


      #3
      70% sounds reasonable. It depends on how much you earn. We need to differentiate between tax and social insurance. If you were to pay social insurance it would be more like 63%. However for a contract of a year or less and in particular if you are resident in the UK, I would see no reason why you would pay social insurance.

      The main thing is query the umbrella that you would be working as a "Freiberufler" (Freelancer). Social insurance is not a tax as it is in the UK and is not enforced by the German tax office.

      Even if you are a German resident it is quite possible to opt out of social insurance, as the rules are similar to IR35.

      The only thing you need to check is that all your income is declared to the German tax authorities.

      A tax calculator is shown here:
      Lohn- und Einkommensteuerberechnung

      For an income of 100,000 you pay 30,000 tax. Note that there are additional deductions that employees pay. As I mentioned, as a "freiberufler" (freelancer) you are exempt from these deductions.
      Last edited by BlasterBates; 17 March 2019, 11:18.
      I'm alright Jack

      Comment


        #4
        Originally posted by OneManBand View Post
        I've been approached by an agency about a contract that involves 2-3 days of work in Germany and the rest here / WFH. The agent said they operate via a German umbrella company, which will pay me net of all German taxes and social security, and the payments will be made to my personal bank account.

        He mentioned that I'd retain just over 70% of my daily rate after all taxes.

        Does this sound legit? I've searched for the agency name here but found no match. The last thing I need is working with a dodgy umbrella co and being chased by two sets of tax authorities.
        Did you ever find out about your umberalla company ?

        Comment


          #5
          Originally posted by OldCodger View Post
          Did you ever find out about your umberalla company ?
          Nope. Never heard back from them.

          Comment

          Working...
          X