Contracting in Germany

[ThomasSoerensen]

Based on the info I have received from my accountant for my income of 2008 and planned income of 2009, on my 110,000 I am expected to pay approximately 12,000. This is based on being married with one infant, and submitting every bloody receipt I can get away with.

This is not going to make the German taxman happy.

Are you planning on declaring 110k on your tax return as the profit of your business and then be asked to pay 12k in taxes? Forget about it.

[darmstadt]

The way tax is done here can be confusing. For example I have just had a tax bill for 2007 which is rather a lot and this is due to the fact that in 2006 I didn't earn too much so the projected tax earnings for 2007 were based on that. However in 2007 I earnt quite a fair bit and so have to pay back taxes, ditto for 2008 which was based on 2007. This year there are also changes in the way MwSt is calculated which will probably catch a few people out.

[chef]

I spend around EUR3k a month on expenses..

4 x rtn flights at EUR500 each
EUR1k for accommodation

quote from my accountant
"As long as you can show that you maintain the centre of your private life in the UK, you will be able to claim expenses for your German accommodation as well as your travel expenses back home."

[ThomasSoerensen]

I spend around EUR3k a month on expenses..

4 x rtn flights at EUR500 each
EUR1k for accommodation

quote from my accountant
"As long as you can show that you maintain the centre of your private life in the UK, you will be able to claim expenses for your German accommodation as well as your travel expenses back home."

my accountant thought it would be strange if I had centre of my life to be a rented out flat in Denmark while me and wife and kids are here in Germany.

Chicken!!!

[Olly]

I spend around EUR3k a month on expenses..

4 x rtn flights at EUR500 each
EUR1k for accommodation

quote from my accountant
"As long as you can show that you maintain the centre of your private life in the UK, you will be able to claim expenses for your German accommodation as well as your travel expenses back home."

Are you really being watched with such eagle eyes that you have to run any of this through Germany? Strikes me you'll be close to the 183 limit for tax residency. Just surprised you didn't just stick with running everything through UK?

[AlfredJPruffock]

I did this some years ago and the UK agency wanted me to go through a management company, upon mentioning this to my accountant, they just laughed and said 'no way unless I want to get investigated!' As I have a residents permit for Germany there is no need for me to do any of this so it doesn't really apply but try telling UK agencies this. I bill to various companies across the EU (and USA) and work in them. As long as I pay my tax here in Germany then I have no problems. The problem is that UK contractors come here and think that they can get away with paying no tax, etc. here by using, what is considered under German tax laws, dodgy schemes that the Finanzamt go after them and gives the rest of us, who do everything legally, a bad name.

Well anybody in IT working Germany who is not on a regular PAYE tax scheme deducted at source will arouse the interest of the Finanzamt - I remember a music shop owner who was driven to despair by the tactics of the Finanzamt.

[AlfredJPruffock]

I did this some years ago and the UK agency wanted me to go through a management company, upon mentioning this to my accountant, they just laughed and said 'no way unless I want to get investigated!' As I have a residents permit for Germany there is no need for me to do any of this so it doesn't really apply but try telling UK agencies this. I bill to various companies across the EU (and USA) and work in them. As long as I pay my tax here in Germany then I have no problems. The problem is that UK contractors come here and think that they can get away with paying no tax, etc. here by using, what is considered under German tax laws, dodgy schemes that the Finanzamt go after them and gives the rest of us, who do everything legally, a bad name.

Well anybody in IT working in Germany who is not on a regular PAYE tax scheme deducted at source will arouse the interest of the Finanzamt - I remember a music shop owner who was driven to despair by the tactics of the Finanzamt.

[chef]

Are you really being watched with such eagle eyes that you have to run any of this through Germany? Strikes me you'll be close to the 183 limit for tax residency. Just surprised you didn't just stick with running everything through UK?

Well anybody in IT working Germany who is not on a regular PAYE tax scheme deducted at source will arouse the interest of the Finanzamt - I remember a music shop owner who was driven to despair by the tactics of the Finanzamt.

WHS

and im fairly confident that the gig will go on longer than 6 months, even if it doesn't then the most likely place for me to find work now is Germany and I dont want the extra hassle of paying uk taxes then filing as Freelance in germany only to be taxed again or going through the extra paperwork, be positive, keep zee germans happy and wait for the renewal to come i say..

[AlfredJPruffock]

WHS

and im fairly confident that the gig will go on longer than 6 months, even if it doesn't then the most likely place for me to find work now is Germany and I dont want the extra hassle of paying uk taxes then filing as Freelance in germany only to be taxed again or going through the extra paperwork, be positive, keep zee germans happy and wait for the renewal to come i say..

In Germany - do they still have those guys in Green Uniforms - from the Ordnungsampt department I think they were called - busybody snoopers whose job it is to go around and just check everybody and everthing is 'in order' ???

'Ordnung' is a word you shall hear a LOT in Germany Chef - Good Luck.

"Paperien Bitte ": you will also hear from time to time.

[Metlem]

Legal backgrounds from German lawyer

Here you can find some background information about the offshore account-cases:
www.tobiasrudolph.de/aktuelles40.html?site=Penal proceedings for tax fraud against foreign IT specialists

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