Working remotely from the UK for German company/agency. Where do I pay tax ?

[FrankyFingers]

Hi,

I am an engineering contractor, British citizen and based in the UK. I currently contract in the UK using my own LTD company. As per the title; I have been offered a contract working for a German company through a German agency working remotely from my home office with occasional on site work in Germany.

So the million dollar question is where do I pay tax ? Before anybody says it - I would ask my accountant but he's on holidays for 2 weeks I have tried searching for an answer but can't find anything definitive to my situation but from what I can work out is, if i do have to pay tax in Germany there will be little point bothering.

Thanks for any help
Franky

[NotAllThere]

In most cases, you pay tax where you work. You are working remotely, so you pay tax in the UK. No tax liability for Germany. I am not a international tax lawyer.

[dsc]

@FrankyFingers curious if you had any updates to this? I might be in a similar boat, doing remote work, but still flying over every few weeks and most likely doing a longer stint at the start, overall around 20-25% of the work would be done in Germany, the rest remotely from the UK / elsewhere.

[GigiBronz]

Get into a conversation with an respectable accountancy firm. Pay them an hour or two for a consultation see what they say than get it in written. That’s your insurance policy. You might get good advice here but don’t rely on in especially for sensitive subjects such as tax

[BlasterBates]

@FrankyFingers curious if you had any updates to this? I might be in a similar boat, doing remote work, but still flying over every few weeks and most likely doing a longer stint at the start, overall around 20-25% of the work would be done in Germany, the rest remotely from the UK / elsewhere.

If these are occasional visits then the can probably be classified as business trips. The annual tax free allowance in Germany is around EUR 9000 and you may well be below that anyway, in which case there would be no tax liability.

Your potential income in Germany would be the amount you earn multiplied by the proportion of your time working in Germany.

I would advise contacting Sue at IPAYE

Guide to working in Europe

[dsc]

For sure I'd be talking to a German accountant before deciding what to do tax-wise (thanks for the recommendation BlasterBates).

The thing that is stuck in my head is that you pay tax where you earn money and this is from day one. If I was to decide on the gig I'd be staying in hotels and this creates the first problem, how do you do a tax return if you are not a resident? I always assumed you need to have a residential address for that...

[BlasterBates]

For sure I'd be talking to a German accountant before deciding what to do tax-wise (thanks for the recommendation BlasterBates).

The thing that is stuck in my head is that you pay tax where you earn money and this is from day one. If I was to decide on the gig I'd be staying in hotels and this creates the first problem, how do you do a tax return if you are not a resident? I always assumed you need to have a residential address for that...

If you are doing business in Germany you will be expected to register it and have an address, perhaps an accountant can correspond on your behalf, but are you sure this is more than business visits?

I would talk to an accountant, perhaps try Sue at IPAYE.

[Sue B]

We don't do much in Germany these days, but always happy to have a chat about the hows and whys of compliance.

Thanks

[dsc]

Thanks for your reply Sue, what's the best way to have a chat?

Personally I'd class these as business visits, as I'm sure it's just to have a conversation about what work's been done and pick up work for the next 3 weeks, but when it comes to tax I don't think it really matters what my opinion is...

[Sue B]

My direct line is 0151 443 6830, and I'm in the office this morning!


KR