. . Germany - the taxman cometh

[aalvarez]

The best option is to simply pay your tax in the UK. Many UK contractors work like this in the EU. Do not register with the local authorities or open a German bank account, stay invisible.

Paying full-whack German tax doesn't bear thinking about. Using an offshore scheme could get you into trouble.

A lot of people are doing it, some are getting caught some are not. What I have been wondering is, with the new VAT rule changes regarding Place of Supply some people should have started charging VAT locally, if they do it they will become visible. They may choose not to do it, but if anyone up the chain is reviewed they will push the liability down and make the lower ones pay the missing VAT out of their own pocket (or attempt to reinvoice) while they are at it, they will surely review the tax situation by looking at the past invoices. Note that in Germany, the burden of proof is normally reverted in certain tax situations (i.e. double taxation), while in others its split.

Ironically, there are so many tax exceptions and the system is so convoluted that it is possible to pay almost no tax with proper planning, but this requires a bit of studying and/or a really good tax accountant. Most of them just do the 60% of the work in 20% of the time. But its the missing 40% where the real savings are.

[Aristotle]

Paying back tax

Just noticed this very useful forum. There's clearly a huge interest in this topic based on number of hits on the threads, so clearly lots of people are facing problems with german tax authorities, lots of people worrying. Let's try to keep the discussion constructive to help each other with some advice (do bear in mind that trolls will also be lurking, even posting). If people want to be abusive, please do so elsewhere (where are the moderators ?).

[Edelweiss]

Just noticed this very useful forum. There's clearly a huge interest in this topic based on number of hits on the threads, so clearly lots of people are facing problems with german tax authorities, lots of people worrying. Let's try to keep the discussion constructive to help each other with some advice (do bear in mind that trolls will also be lurking, even posting). If people want to be abusive, please do so elsewhere (where are the moderators ?).

The TRUTH is that this thread should be called:
"The Kraut Taxman Set You Up"
(And always will...)

[CodeKid]

Getting time to pay

Assuming you decide to declare any additional income etc, does anybody know if the F-amt will give you time to pay, if so over what sort of time period or do they just come gunning for you with their mausers blazin'. Does anyone have experience of getting an agreement with them on that ? Is it better in that case to leave Krautland and negotiate from afar ? I know about the MARD but maybe HMRC would be more sympathetic to agreeing a repyament plan.

[darmstadt]

Assuming you decide to declare any additional income etc, does anybody know if the F-amt will give you time to pay, if so over what sort of time period or do they just come gunning for you with their mausers blazin'. Does anyone have experience of getting an agreement with them on that ? Is it better in that case to leave Krautland and negotiate from afar ? I know about the MARD but maybe HMRC would be more sympathetic to agreeing a repyament plan.

Apparently not but I should be able to say in a couple of weeks as I have a 5 figure tax bill coming for 2008 (according to my accountant.)

[BlasterBates]

Assuming you decide to declare any additional income etc, does anybody know if the F-amt will give you time to pay, if so over what sort of time period or do they just come gunning for you with their mausers blazin'. Does anyone have experience of getting an agreement with them on that ? Is it better in that case to leave Krautland and negotiate from afar ? I know about the MARD but maybe HMRC would be more sympathetic to agreeing a repyament plan.

If can't pay in one go you can negotiate a repayment plan, shouldn't be a problem, however if this is Steuerhinterziehung i.e. "evasion" and you can't pay, then the "self-reporting" won't free you from penalties if you don't payup straight away.

[darmstadt]

I believe MwSt (VAT) has to be paid immediately which is a shame as I got a 10K bill today which has to be paid by 26/3

[Edelweiss]

I believe MwSt (VAT) has to be paid immediately which is a shame as I got a 10K bill today which has to be paid by 26/3

I'll be laughing the next time Germany burns to the ground.

[chef]

I'll be laughing the next time Germany burns to the ground.

what exactly is your problem other than being a racist?

and an obvious troll.

[poppy01]

advice please

I worked through Albany in 2006-07 for about 11 months. I've read this thread and it has worried me but have let sleeping dogs lie. I really had no idea at the time there was a risk that the MC were running anything that F-Amt might think illegal or come gunning for. Also I followed the rules and declared the split part in the UK as distibution of profit (the year after deregistering from Germany) and paid UK tax on it, as per Albany's instructions. I've now received a letter from my German accountant stating that I might be charged with tax evasion and that to avoid this I should come clean now. What to do? Continue to let sleeping dogs lie (the letter appears to be just a heads up that there's a risk) or self declare and take the hit. In that case, will I be able to adjust my uk tax returns for those years to get back the tax I already paid? Very worrying indeed. Also, is anyone considering suing Albany for selling what looks to have been a fatally flawed scheme. I have not set foot in Germany since April 2007 when I deregistered and have no intention of going back.