German Tax Raid

[happyradio]

The Germans seem to have proof that you have been living in Germany for the last 46 months

18 months ago I rented a flat here in germany & hence my things were also here (i think that is actually a no brainer)prior to that I was in the netherlands in a rented flat... & prior to that in the uk in my own house ...german wants tax for all the time I was not in germany & working through a ltd company.... BTW they are refusing to release any papers, the hard disks don't work & to provide copies of my papers he will charge me 50 cents a copy... unless I accept the charges & PAID UP... else they say it can take up to 1 year to get everything back.. they have in excess of 4000 papers... what the charges are they have not said & how much money they want me to pay has also not been mentioned..... I just have to accept that I lived here all along... they will then send the bill

[Moscow Mule]

If they have all of your papers, I suppose they have a copy of your rental / mortgage agreement for your house in the Netherlands?

Perhaps pointing them to that might be a starting point.

[SueEllen]

If you owned a house in the UK then there would be records of that though it would be a case of you phoning organisations and seeing if they would be prepared to give you a copy of something as proof. In some cases though you may have to do a data subject access request.

Plus agencies/ex-employers would also have records on you.

Also you could have estimated your self assessment return, done it so it was a small over estimation and then paid it.

BTW When I've worked abroad I've always kept documents like degree certificates in the UK and some of my bank/credit cards stayed in the UK also. Then again I had no intention of settling permanently or changing client.

[darmstadt]

The only way you could have rented a property in Germany would be to register at the local authorities plus open a German bank account. When you left Germany you should have deregistered and, not neccesary though, closed your bank account. If you didn't, at least deregister, then the German authorities infer that you were resident here the whole period. The onus is on you and your lawyer to prove you weren't.

[Brussels Slumdog]

It seems that you have been living in the UK,Netherlands and Germany for the past 46 months
-Where we you actually working during this period (Source of Income)?
- Did you use a Ltd company to work in Germany?

[happyradio]

Guys - here is a bit more details:
yes I de-registered before I left Germany

Yes I have employment, rental agreements proof of living in the UK & Netherlands

I worked in Germany in 2 stints between 2006 & 2007 within 183 day rule - Accountant inGermany guarantees this is not a problem & tax man is not challenging this aspect per se

There is ample evidence that I lived & worked outside germany in then intervening period.

There is nothing that ties me to Germany except that I dated a girl there from 2006/2007 & married her in the UK in 2010.

During this period she got me membership in a Gym which cost her Euro 15 per month. This was only cancelled in 2010 but the tax man here says that this is proof to living in Germany all along.

We have asked the tax man to find out how often the gym was frequented & then comment. He seems not willing to do that.The Gym wont supply such information to me or the lawyer or possibly dont have it.

My wife got me this membership because she thought I was getting a bit to fat but I used it less than a dozen times.

[chef]

Surely this is a conversation you should be having with an English speaking German solicitor?

If all the evidence points to you living outside the country and not in the flat you have rented including de registration etc. then the German taxman knows that when this comes to court they don't stand a chance and won't pursue you any further. Ranting about it on a uk it contractor forum isn't really going to help matters.

Ask your accountant for a good solicitor and speak with the people on toytown forum for advice as a much larger percentage of them live in Germany than do on this forum.

Good luck.

[chef]

Just one other point.

If you de registered before you left Germany but continued to rent a flat there and still live there then it is a logical conclusion to think that although you didn't work in Germany that you lived in Germany (I.e cross the border onto German soil) for more than the 183 days of a year and simply commuted across the border to the Netherlands.. Or have I misunderstood that you weren't actually living in the flat that got raided when it was raided?

[BlasterBates]

It´s complicated because you had a girlfriend in Germany. If you were visiting your girlfriend at the weekend in Germany they could argue that your main tax residency is in Germany. Basically you were in Germany you settled there got a girlfriend and then went off to work in the UK and the Netherlands but because you have "family ties" in Germany it can be deemed your main tax residence. Forget the 183 day rule that´s only part of the story. I´ve been working in Switzerland for the last 8 years but my main tax residence was Germany. I spent far less than 183 days in Germany; it´s enough to spend two weekends in Germany per month for it to be your main residency. Now that´s not to say I get taxed on my earnings from Switzerland, I haven´t been, but I declared them.

Unfortunately what you should have done was either to continue to submit tax returns or send a detailed explanation of your personal circumstances and challenge them on the fact of your tax residency, whilst you were regularly visiting Germany.

You are very lucky indeed that they haven´t challenged your 2006/2007 periods, some contractors were less so. Don´t simply assume you have nothing to worry about, they may simply not know about it.

What you need to do now is to contact a good Steuerberater. You now need to prove to them that you were working in the UK and Netherlands. Your salary I think will not be taxed again. Your dividends may be taxable in Germany, but they will take into account tax paid in the UK. You can also try to demonstrate that your main residency was the UK but if you were seeing your girlfriend twice a month in Germany that will be a tough one given that you are now not dealing with the admin bods in the office but with the flying squad and the state prosecutor.

I think you may end up owing tax but it won´t be the "full wack" having said that because it was undeclared you might be facing a fine and penalties unless you can demonstrate you weren´t tax resident.

Good luck.

[happyradio]

Chef: I think you misunderstood re de-registering & renting a flat & yes i have a lawyer & accountant... we have another meeting tomorrow morning & based on the outcome we will either decide to change to a lawyer recommended by the family or stick with him & conclude matters

BlasterBates: I spent 1 weekend per month on average & approximately 2 weeks of my holidays per year in Germany..she did the opposite in the UK/Netherlands... But I do see your point.. If I knew these people are this mental I would have submitted my tax returns every year to them as well.... I think the outcome will be like you said... they may tax my dividend & even fine me though I don't think it would be fair at all.

BTW current lawyer thinks it's a bit extream but better negotiate & settle up... accountant thinks they are bonkers & we should fight them.