Contracting in Germany through UK company

[Boo]

There is a concept of economic activity and centre of direction of a company. If the Finanzamt decide that Yourco Ltd has those in Germany, what are you going to reply to them? That there is no such concept?

I am going to reply to them that the Kings of Belgium and Denmark have both recently been shown to be in breach of EU law by making it hard for, inter alia, employees of other EU firms to work on secondment in their countries, and if the head of the German state doesn't want some of the same s/he'd better drop it pronto.

German law regarding incorporation to UK firms and there is no question that a UK 1 man band Ltd Co is properly constituted. They would have no leg to stand on.

Boo

[doodab]

Your Ltd Co. is registered and based in the UK and remains there. There is absolutely no legal concept of a Ltd Co. registered in one country "moving", it is fixed in the domain of registration.

This is true but it has sweet FA to do with tax residence. Generally a companies profits are taxable wherever the "centre of management and control" of the company is located, regardless of where it was registered.

The 183 day "rule" is an individual thing and has no bearing on a company's tax affairs. When you move, the company's tax liability moves. Your personal tax liability may well stay behind.

[Coalman]

Re: Contracting in Germany through UK company

Does anyone know what the score would be if you do a number of small stints, say 2 or 3 day stints up to 10 times a year?

[SueEllen]

Does anyone know what the score would be if you do a number of small stints, say 2 or 3 day stints up to 10 times a year?

In theory you should be all right.

In practise I would get another director just to make sure. You probably have at least one compliant trusting relative over 18

As long as they don't have access to the company bank account then it shouldn't be a problem. If they live at a different address then it's easier to ensure this.

[aalvarez]

I am going to reply to them that the Kings of Belgium and Denmark have both recently been shown to be in breach of EU law by making it hard for, inter alia, employees of other EU firms to work on secondment in their countries, and if the head of the German state doesn't want some of the same s/he'd better drop it pronto.

German law regarding incorporation to UK firms and there is no question that a UK 1 man band Ltd Co is properly constituted. They would have no leg to stand on.

Boo

This two rulings have nothing to do with taxes, but with Internal Market Rules and National Insurance Contributions.
There is absolutely no problem in Germany in this regard. To clarify, you can easily operate from a UK limited in Germany as long as you register with the Tax Office (Finanzamt) like a local company would do and have an accountant that knows how to deal with Double taxation treaties and the Finanzamt in Germany. It is, however, way simpler, and cheaper to register locally as a freelancer as you will not have to pay corporation tax and may be able to avoid local NI contributions, also, if done properly, pay less taxes than you would in the UK.

[darmstadt]

This two rulings have nothing to do with taxes, but with Internal Market Rules and National Insurance Contributions.
There is absolutely no problem in Germany in this regard. To clarify, you can easily operate from a UK limited in Germany as long as you register with the Tax Office (Finanzamt) like a local company would do and have an accountant that knows how to deal with Double taxation treaties and the Finanzamt in Germany. It is, however, way simpler, and cheaper to register locally as a freelancer as you will not have to pay corporation tax and may be able to avoid local NI contributions, also, if done properly, pay less taxes than you would in the UK.

Correct, you can even open a UK Ltd. here in Germany and use it legally. The problem with this thread, and every other one about tax in Germany is that people think that they can go there and get away with paying no, or little tax in either the UK or Germany as they think they're inder the radar. People have been trying this for years and get caught. There have been many suggestions as to what to do if you want to contract in Germany, such as above by registering as a Freiberüfler and getting a Steuerberater, which are correct but people still think they can try it on.

[sunflower]

Does anyone know what the score would be if you do a number of small stints, say 2 or 3 day stints up to 10 times a year?

Should be ok, you would just be seen as visiting your customer in Germany, but still based in the UK. You could not be seen as residing in Germany if you were staying in hotels. Keep all travel tickets and hotel bills as evidence.

[northernladuk]

Should be ok, you would just be seen as visiting your customer in Germany, but still based in the UK. You could not be seen as residing in Germany if you were staying in hotels.

Our gov't is putting people up in hotels cause there is not enough housing for them and they are residing in the UK. I don't think that argument is one to fall back on IMO.

Once you start doing so many regular 'stints' the lines would blur the line between a visit and resident trying to pull a fast one and I would imagine you have to be very careful about keeping them as stints and not start getting lax to the point you crucify yourself.

[suityou01]

So, boiling it down?

Ltd or Freiberufler?
Rent or Hotel?
If Freiberufler status, can you offset expenses against German tax?
Does your ltd definately become a German legal entity for the duration of your stay of has Doodab gone mental?

I'm already fed up with this contract and I haven't even started

[darmstadt]

So, boiling it down?

Ltd or Freiberufler?
Rent or Hotel?
If Freiberufler status, can you offset expenses against German tax?
Does your ltd definately become a German legal entity for the duration of your stay of has Doodab gone mental?

I'm already fed up with this contract and I haven't even started

Well I'm Freiberüfler and I offset practically everything against tax (well my accountant does.) I think if your contract is definitely only going to be for 3 months with no possible extension and you know that you won't be working in Germany again in the same tax year, I don't see why you just don't use your Ltd.