. . Germany - the taxman cometh

[darmstadt]

I've been reading this thread with some interest and have come to the following conclusion...

Diptulip...you're going down...

So the Finanzamt look at the accounts of where you have been contracting, notice payments to a British agency, check with them where the money is. They point to a contractor with the name of BlightyBoy who is paid by this MSC and bob's yer uncle.

Personally it doesn't affect me because I'm resident here and have only ever worked via one British agency. Due to having a very good accountant I probably take home more than most UK contractors anyway

[Slumdog]

we need your accountants details

[BlightyBoy]

An inconvenient truth

Diptulip...you're going down...

So the Finanzamt look at the accounts of where you have been contracting, notice payments to a British agency, check with them where the money is. They point to a contractor with the name of BlightyBoy who is paid by this MSC and bob's yer uncle.

Personally it doesn't affect me because I'm resident here and have only ever worked via one British agency. Due to having a very good accountant I probably take home more than most UK contractors anyway

Oh yeah? Come and have a go if you think you're hard enough!

I couldn't give a rats rear-end what the agency tell the Finanzamt or HMRC. It doesn't alter the fact that part of the revenue generated by my efforts has dissappeared offshore. Once that happens, then it's gone. Lost. Invisible.
Pick a bank in a country with privacy laws, there are still a number left, and one should immediately jump to everyone's mind....

If that money remains lost in my own offshore account, so long as I don't leave a paper-trail then it stays lost. End of.

If you keep stum, they can prove nothing. If you wet your pants, then they can pressure you into admitting to everything. Simple fact. Simple truth.

[Codejock]

I've been reading this thread with some interest and have come to the following conclusion...

YOU BUNCH OF PUSSIES!!

As for you guys who are concerned about your own self-image (Blaster, Darmstadt, CodeJock et. al), you guys are only narked cause you didn't get to split and save the bucks in the first place, so climb-down off the moral high ground (Freiberufler, declarations, etc. etc.) and face up to the fact that you missed out on the last gravy-train out of Contractorville.

Ooh.. them's fightin' words!....

[LegendsWear7]

In an attempt to keep this on topic.

I understand that the Finanzamt will not 'recognise' the MC. And see the payment as being from client (not clear if that is agency or end-user) as being liable for VAT.

So in a disaster case: you (I) would have to pay +20% VAT that wasn't even charged / received originally.

In my case I was via a UK agency (they have a German presence but I'm fairly sure I signed with a London office) and later via a German agency.

I have a bad feeling that particularly with respect to the German agency period that VAT may be demanded.

I think it is unrealistic to back claim VAT from agencies so where would I stand ?

[BlasterBates]

In an attempt to keep this on topic.

I understand that the Finanzamt will not 'recognise' the MC. And see the payment as being from client (not clear if that is agency or end-user) as being liable for VAT.

So in a disaster case: you (I) would have to pay +20% VAT that wasn't even charged / received originally.

In my case I was via a UK agency (they have a German presence but I'm fairly sure I signed with a London office) and later via a German agency.

I have a bad feeling that particularly with respect to the German agency period that VAT may be demanded.

I think it is unrealistic to back claim VAT from agencies so where would I stand ?

You need to check. VAT must have been paid somewhere along the line. In your case I would sue the MC, you've been led up the garden path with what looks like a tax evasion scheme. But the worst thing is these MC's are still persuading contractors.

[tim123]

Diptulip...you're going down...

So the Finanzamt look at the accounts of where you have been contracting, notice payments to a British agency, check with them where the money is. They point to a contractor with the name of BlightyBoy who is paid by this MSC and bob's yer uncle.

Yep. The Belgians did the same some years ago and I'm told several contractors just packed up and left in a hurry.

This is why they now have LIMOSA (is that its name?)

tim

[Nick44]

Germany = Gotta be compliant... german tax on full income etc(without the church tax maybe lol)

theres too many crazy solutions that just end up causing problems down the line

I'd make sure that whoever is payrolling has a valid AUG license... key word is "valid", too many dodgy MC's are using ones that have expired moths ago :/

[SalsaFever]

So the Finanzamt look at the accounts of where you have been contracting, notice payments to a British agency, check with them where the money is. They point to a contractor with the name of BlightyBoy who is paid by this MSC and bob's yer uncle.

Hey Darmstadt,
I think you are watching too many Al Pacino movies and maybe confusing reality with the fiction. My favorite scene is Al Pacino plays an LAPD officer visitin Vegas to bust a guy:
Al Pacino - LAPD, hands up!
Bastard - Hey, this is Vegas, you have no jurisdiction here!
Al Pacino - So what? Bang bang!

well maybe in movies it's like that.. But there is no way in God's green Earth, neither UK Agency nor the MSCs will bend over and hand out the names & payment details of the contractors.

It's because simply finanzamt has no jurisdiction in UK or in Switzerland.. They can't bend time & space to cross borders.. Maybe they could just write a kind letter requesting info but the letter would surely end up straight into the waste bin..

(remember the Deutsche Post scandal, even tiny next door neighbor Liechtenstein refused to reveal its clients, so germans had to pay 5m euros to obtain a stolen CD illegally)

Sure, they could find out how much the end client in Germany is paying to the agency.. However what contractors actually making is still a misery, since there are two or three parties in the food chain. Most times, the end client is using a legit consultancy company (especially the Swedish ones starting with T) which is using an UK agency to find contractors and the agency forcing them to use a 'preferred' MSC to fulfill some stupid UK legislation. Most of the cases, only %60 of what end client pays end up in contractors pocket.

Besides those big consultancy companies use permanent employees side by side as the freiberuflers and charge same rate to the end clients. They are some poor bastards from China, India or Pakistan who desperately needs a work permit, so they accept to work for 40k euros a year doing same work as other british contractors, but profit taken by the consulting company.

So it's tough job for finansamt to pick out bad apples, since one side there is a %110 legit indian guy on work permit making only 2000 euros a month, on the other side 'average joe' from Birmingham declaring 6000 euros a month looks not really suspicious, but in the both case, end client is billed 15k, go figure out.

[BlightyBoy]

I thank-you!

Hey Darmstadt,
I think you are watching too many Al Pacino movies and maybe confusing reality with the fiction. My favorite scene is Al Pacino plays an LAPD officer visitin Vegas to bust a guy:
Al Pacino - LAPD, hands up!
Bastard - Hey, this is Vegas, you have no jurisdiction here!
Al Pacino - So what? Bang bang!

well maybe in movies it's like that.. But there is no way in God's green Earth, neither UK Agency nor the MSCs will bend over and hand out the names & payment details of the contractors.

It's because simply finanzamt has no jurisdiction in UK or in Switzerland.. They can't bend time & space to cross borders.. Maybe they could just write a kind letter requesting info but the letter would surely end up straight into the waste bin..

(remember the Deutsche Post scandal, even tiny next door neighbor Liechtenstein refused to reveal its clients, so germans had to pay 5m euros to obtain a stolen CD illegally)

Sure, they could find out how much the end client in Germany is paying to the agency.. However what contractors actually making is still a misery, since there are two or three parties in the food chain. Most times, the end client is using a legit consultancy company (especially the Swedish ones starting with T) which is using an UK agency to find contractors and the agency forcing them to use a 'preferred' MSC to fulfill some stupid UK legislation. Most of the cases, only %60 of what end client pays end up in contractors pocket.

Besides those big consultancy companies use permanent employees side by side as the freiberuflers and charge same rate to the end clients. They are some poor bastards from China, India or Pakistan who desperately needs a work permit, so they accept to work for 40k euros a year doing same work as other british contractors, but profit taken by the consulting company.

So it's tough job for finansamt to pick out bad apples, since one side there is a %110 legit indian guy on work permit making only 2000 euros a month, on the other side 'average joe' from Birmingham declaring 6000 euros a month looks not really suspicious, but in the both case, end client is billed 15k, go figure out.

MY POINT PRECISELY!!!

It's reassuring to see that I am not the only one reading this forum who has a pair!

It even goes further than that, a Finanzamt only has jurisdiction WITHIN IT'S OWN REGION!! They aren't even totally omnipotent within their own country! (Sure, inter-region assistance would be forthcoming - but let's not lose perspective here). The Finanzamt are not the all-knowing, all-powerful Gaia-like entity that others in this forum would have you believe.

EVEN IF an agency told the Finanzamt that a contractor was charged to the end client at a given rate, that does not preclude the fact that the MC (with whom the contractor has the direct agreement) is paying, or obliged to pay the same amount.

EVEN IF the finanzamt go after the MCs records, there is nothing to indicate that any monies dissappearing OFFSHORE ultimately make it into the contractors pockets.

Anybody currently facing an investigation by the Finanzamt right now (in terms of Offshore payments etc.) is either a) phenomenally unlucky, b) phenomenally stupid or c) has phenomenally stained underwear.

Our grandfather's stood up to these Fascist Bullyboys in 1939, don't you pussies think you should be doing the same!!