Brit, now in Germany, looking at Netherlands...

[Andy Stone]

Advise needed please on where to take my next contract. Briefly:

- I've been out of the UK (travelling) since 1st May 2008 (UK Ltd Co has been closed down)
- I've been staying in Germany since Jan 2009
- There's work on offer in Holland, and potentially Germany.
- I believe Germany is now a dire place for a UK based contractor to work, but is it the same for German-registered contractors (I've not registered yet)? Does Herr Taxman ram his own from behind as badly as he does foreign contractors?
- If I take a role in Holland, would I be better off via the 30% scheme? As I would be there 5 days a week, would I be even better off registering as a Dutch resident (if possible)?

Thanks for any help you can offer
Andy

[BlasterBates]

Advise needed please on where to take my next contract. Briefly:

- I've been out of the UK (travelling) since 1st May 2008 (UK Ltd Co has been closed down)
- I've been staying in Germany since Jan 2009
- There's work on offer in Holland, and potentially Germany.
- I believe Germany is now a dire place for a UK based contractor to work, but is it the same for German-registered contractors (I've not registered yet)? Does Herr Taxman ram his own from behind as badly as he does foreign contractors?
- If I take a role in Holland, would I be better off via the 30% scheme? As I would be there 5 days a week, would I be even better off registering as a Dutch resident (if possible)?

Thanks for any help you can offer
Andy

No there isn't any discrimination at all. Tax evasion is illegal for everyone.

If you declare your income in Germany there is no problem whatsoever.

The tax rate is around 35% and that's all in.

Foreigners using tax management companies have been completely screwed by a tax evasion scam. It is unfortunate that these scams still operate.

[Codejock]

Even better than that...

If you declare your income in Germany there is no problem whatsoever.

The tax rate is around 35% and that's all in.

It is a little better than that. As a Freiberufer, my Steuerberaterin calculates my tax at, and the Finanzamt confirm, a rate known as "Grundtariff" of 29.5444%. There is the so-called "Solidaritätszuschlag" on top (not sure how much that is) but think it is a little less than 5.5% (but I could be wrong).

If you get a good local tax-accountant, you are probably looking at retaining something around 70% (accounting for deductible expenses, e.g. travelling, insurances etc.) of your hourly rate, all-in, fully legit.

[darmstadt]

There is the so-called "Solidaritätszuschlag" on top (not sure how much that is) but think it is a little less than 5.5% (but I could be wrong).

Solidaritätszuschlagsteuer is 5.5% of your monthly income tax, i.e. if you pay €100 a month income tax (Einkommensteuer) then you will pay an extra €5.50 per month

[BlasterBates]

It is a little better than that. As a Freiberufer, my Steuerberaterin calculates my tax at, and the Finanzamt confirm, a rate known as "Grundtariff" of 29.5444%. There is the so-called "Solidaritätszuschlag" on top (not sure how much that is) but think it is a little less than 5.5% (but I could be wrong).

If you get a good local tax-accountant, you are probably looking at retaining something around 70% (accounting for deductible expenses, e.g. travelling, insurances etc.) of your hourly rate, all-in, fully legit.

yeah it was very rough I agree with you, Ican't remember exactly, but I know it was quite acceptable. I certainly wouldn't move countries because there isn't much differemnce wherever you are, provided it is legit.

[Codejock]

Solidaritätszuschlagsteuer is 5.5% of your monthly income tax

Thanks for clarifying Darmstadt. I guess that new contract in the public sector (Ministry + Money) does have other perks!

I retain roughly 70%, but that probably has something to do with the relief on private medical insurance, voluntary unemployment insurance and the fact that I get a "Kinderfreibetrag" (child allowance).

Still, even at ~65%, (worst case) it's not too bad a deal.

[Andy Stone]

Thanks - one more question...

Thanks a lot for the info.

Do you know anything about a company called CPM Group? They state that they "earned our AUG licence by sticking rigidly to the compliance rules.

We are all highly qualified people here and a regulated accountancy to boot. "

Any horror stories that you know about?

Thanks again
Andy

[tim123]

No there isn't any discrimination at all. Tax evasion is illegal for everyone.

If you declare your income in Germany there is no problem whatsoever.

The tax rate is around 35% and that's all in.
.

Assuming you are allowed to work as a Freiberufer. I know at least three major (german) multinationals that will not allow this.

tim

[BlasterBates]

Assuming you are allowed to work as a Freiberufer. I know at least three major (german) multinationals that will not allow this.

tim

I think you'll find that if you work for a German agency/company that it isn't a problem. They just employ on a EUR 400 basis. I operated as a Freiberufler for a multinational that "doesn't allow" them. It is actually none of their business as your contract is with the agencies. So the German agencies sort it out for you. British agencies wouldn't.

[SizeZero]

Advise needed please on where to take my next contract.

- If I take a role in Holland, would I be better off via the 30% scheme? As I would be there 5 days a week, would I be even better off registering as a Dutch resident (if possible)?

Andy

To qualify for the 30% ruling you need to be recruited while not resident in the Netherlands and offered employment by a company who is approved by the Dutch Tax Authority; that company must have advertised the job within the Netherlands to prove that they couldn't attract anyone suitable locally, therefore needing to go abroad to find someone suitable.

The first thing the Dutch tax authority look at is the salary and if it's below €45k then you probably won't qualify. Even above this rate, nobody can guarentee in advance you will be approved, it's not automatic. One more thing about the Dutch Taxman - they now refuse to speak any other language to you except Dutch (they used to speak in English if preferred but are no longer allowed to).

The one-man-band contractor model doesn't really operate in the Netherlands; contractors are employees of agencies and are sent to jobs rather than find their own. This isn't necessarily a bad thing because most dutch managers are shrewdness personified - the phrase 'tighter than a gnat's ass' applies to those who control the IT budgets so you probably get a better deal financially having native dutch dodgy-agents to do the negotiations.

The global recession has taken longer to get around to cheeseland, but it's here now. Companies are pulling their belts in, vacancies are slowing down, and even hairgel sales are falling - a sure sign of hard times