German Payroll Partner

**Brussels Slumdog** · 23 January 2019, 20:17

The first question is, whether you have a fixed adress in Germany or commuting weekly from the UK
My situation is different as Germany and Belgium have frontier agreements.
Another problem is that UK Ltd one man set ups don't exist in Europe

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**Poker space** · 26 January 2019, 08:27

I contacted 2 German tax advisors and both advised to use my UK ltd company. Reasons given were I was regularly travelling back to UK, had a home there, had no fixed adddress in Germany. They both said I would have to make a tax return in Germany and declare my monthly ltd co salary as income and pay tax on that.
There are many payroll partners who will put you through German PAYE and charge you a monthly fee. Search on the toytown forum for a local German tax accountant if you want to go through limited company and file German tax return.

**Old Greg** · 26 January 2019, 10:09

Worth contacting Sue@iPAYE.

**BlasterBates** · 26 January 2019, 10:26

Originally posted by Poker space View Post

I contacted 2 German tax advisors and both advised to use my UK ltd company. Reasons given were I was regularly travelling back to UK, had a home there, had no fixed adddress in Germany. They both said I would have to make a tax return in Germany and declare my monthly ltd co salary as income and pay tax on that.
There are many payroll partners who will put you through German PAYE and charge you a monthly fee. Search on the toytown forum for a local German tax accountant if you want to go through limited company and file German tax return.

That sounds fine as long as you're declaring all income in Germany. If you pay yourself minimum salary then there will be a huge difference between what you declare and the invoices. That will get you into trouble.

I have also consulted with a very good German accountant and yes you can use a UK Ltd but you must register a branch in Germany. In the end if your German tax return matches the invoice then no problems if you earn £100,000 and pay tax on £10,000 you'll be in big trouble,

UK contractors get caught out when there is an audit in the company they work in, i.e. they will check the invoices against the contactor's tax return.

I would actually advise using a payroll who will set you up as a "Freiberufler".

**Poker space** · 27 January 2019, 19:28

Originally posted by BlasterBates View Post

That sounds fine as long as you're declaring all income in Germany. If you pay yourself minimum salary then there will be a huge difference between what you declare and the invoices. That will get you into trouble.

I have also consulted with a very good German accountant and yes you can use a UK Ltd but you must register a branch in Germany. In the end if your German tax return matches the invoice then no problems if you earn £100,000 and pay tax on £10,000 you'll be in big trouble,

UK contractors get caught out when there is an audit in the company they work in, i.e. they will check the invoices against the contactor's tax return.

I would actually advise using a payroll who will set you up as a "Freiberufler".

I did ask both if I needed to register my Ltd but they both said there was no need. One said they would speak to the local tax office when filing the return to ensure there would be no future issues. That doesn’t mean the local tax office will take a different viewpoint in a few years. I’ll stick with it until May when this contract ends and decide then to go freiberfuler or get a UK contract again.
Re: the OP’s point a payroll PAYE company would eliminate this hassle/confusion but after they take their cut and cost of regular flights doesn’t make the travel worth it.

**m0n1k3r** · 4 February 2019, 20:14

Originally posted by Poker space View Post

I did ask both if I needed to register my Ltd but they both said there was no need. One said they would speak to the local tax office when filing the return to ensure there would be no future issues. That doesn’t mean the local tax office will take a different viewpoint in a few years. I’ll stick with it until May when this contract ends and decide then to go freiberfuler or get a UK contract again.
Re: the OP’s point a payroll PAYE company would eliminate this hassle/confusion but after they take their cut and cost of regular flights doesn’t make the travel worth it.

Do like German contractors do: register as self employed in the UK and post yourself to work in Germany. Doesn't work with one-man limited companies due to OECD fixed establishment rules which are stricter nowadays.

**BlasterBates** · 5 February 2019, 12:56

Originally posted by Poker space View Post

I did ask both if I needed to register my Ltd but they both said there was no need. One said they would speak to the local tax office when filing the return to ensure there would be no future issues. That doesn’t mean the local tax office will take a different viewpoint in a few years. I’ll stick with it until May when this contract ends and decide then to go freiberfuler or get a UK contract again.
Re: the OP’s point a payroll PAYE company would eliminate this hassle/confusion but after they take their cut and cost of regular flights doesn’t make the travel worth it.

As long as all your income is taxed. If you are submitting an invoice of EUR 10,000 a month and you submit a tax declaration of 400 pounds a month you will find yourself in very hot water with the German tax office.

They probably won't really care what vehicle you use to pay tax as long as it reflects your income.

German Payroll Partner