German AUG or no AUG

[darrylmg]

Hello,

I'm seeking clarity on what seems to be either the biggest scam going or a just a big misunderstanding on my part.

I'm a UK resident contractor with my own UK ltd company.
I've got an offer of a contract for only 4 months in Germany.
The contract would be direct between myself and the client (a German GMBH).

The internet (from what I can see) suggests I need to register for an AUG license, except for one site, which goes into a little more detail and stops using the word "agency".
It is suggested that if I am a consultant (I am an IT consultant) and I supervise myself and perform my own work (I do) then I do not need to register for an AUG license as there is already a clear definition that seperates me from my client and their employees.

Is there anyone out there that can confirm if they have been or are in a similar situation and what is the definitive answer?

Lastly, and on a semi related note, if I'm staying in Germany for this contract and I stay over weekends because it's cheaper than commuting, can I claim for my weekend rent or hotel as a business expense?

Thanks in advance.

Daz

[SueEllen]

Do a search on the forum for Germany using the search facility.

You will discover it's not a good idea to use your UK limited company in Germany as their taxman can be difficult. Also it's not tax efficient to use a German AUG instead it would be better if you became a freelancer.

Finally Just because there are reciprocal agreements between EU states it doesn't mean the same way we work in the UK is legal let alone the most tax efficient way to work in another EU state regardless of the length of the contract.

[darrylmg]

Sorry sueellen,
I've yet to find a solid reason why I need to complicate my life with more paperwork.
There's actually no reason I can't use my ltd company in germany.
But that's not the question at hand.
I just need to understand if I must have an AUG license?
I'm not saying the German methods are wrong, they're just not clear enough.
Most the websites, including this forum, quote the same piece of text about AUG licenses and agencies. But there are some subtleties in the rules that I'm trying to see if they apply in my scenario.

Thanks again.

[BlasterBates]

Careful contractors with their own Ltd are not necessarily viewed as companies but as temporary employees, that means you pay tax even if you´re there for 4 months.

Yes you can use your Ltd, but some contractors working in Germany for less than 6 months have been done for tax evasion.

The paper work for tax in German is not onerous and can be done by a Steuerberater.

I would sort out the tax in Germany.

They seem to be experienced in overseas contracting and can at least talk to you about the risks.

The penalties for tax evasion will mean you´ll be handing over your entire earnings if they spot you.

I´m not saying that you will definitely pay tax in Germany, but you need qualified advice. Doing everything under the radar is very risky indeed.

Here is an example of a contractor being prosecuted for a 5 month contract he completed 5 years ago.

http://forums.contractoruk.com/accou...an-prison.html

[darrylmg]

Thanks blasterbates.
It's good to hear that it might not be so complicated.

It's funny that you mention SJD Accountants.
What's your experience with them and Germany?

I ask because I am with SJD and so far they've offered little to no advice. Should I be expecting more?

Ta,

Daz

[SueEllen]

Thanks blasterbates.
It's good to hear that it might not be so complicated.

It's funny that you mention SJD Accountants.
What's your experience with them and Germany?

I ask because I am with SJD and so far they've offered little to no advice. Should I be expecting more?

Ta,

Daz

Ask if you they can help.

The reason I said to use the search is a couple of regular posters have provided helpful advice about working in Germany including useful contacts. Obviously if it's below you to search then don't expect posters to help you.

[darrylmg]

Obviously if it's below you to search then don't expect posters to help you.

Please stop moaning about searching.
There's nothing of relevance about German AUG licenses.
Otherwise I wouldn't have posted.

[oracleslave]

Any use?

http://forums.contractoruk.com/accou...-confused.html

[darrylmg]

Any use?

http://forums.contractoruk.com/accou...-confused.html

Thanks, only the last two posts on that thread are semi-relevant, but the guy is a locum and he'd hijacked the Op's thread.
The post was from 2012 and nobody was able to answer him.
I honestly did see this, but I really don't like hijacking old posts when the original question was related to someone working for a US company via the UK, the moon and then Germany... too many variables compared to my situation.

I guess the same amount of confusion still applies regarding AUG licenses.
I'm pursuing other routes to gain this information, so *if* I find the answer, I'll be sure to post it here, for a small fee ;-) (just joking).

There must be UK contractors via Ltd's out there in Germany, right now, enjoying their spicy wurst sandwhiches and beer, who know the answer to this question...

[darrylmg]

The Final Word

OK, I got put up the ladder through my accountants (SJD), there's a good reason for going with a large accountancy!
Tony (SJD) said that generally an AUG, I would only need an AUG license if the contract was an AUG contract.
An AUG contract would normally be written in German.

My contract is written in German!
However, I double checked with the client and they confirmed that it is not an AUG contract.

AÜG = Arbeitnehmerüberlassung, it would require you to be an employee.

So in essence, double check with your accountants and your client.
My client deals with a fair number of contractors, so they should know what they're doing.

Thanks for the responses.