Contracting in Germany through UK company

[martinluther]

I have been offered 1 year contract running between March 2013 and Feb 2014 in Germany by a German Agency and they can pay me Euro in UK company.

Please advise on tax. I know similar question may have been asked but I am thinking of using my UK company for the purpose.

What is the legal status and what is practical status from HMRC and from German tax people?

[stek]

Contracting in Germany through UK company

You must be mad!

[cojak]

Get advice from a German tax advisor.

If you don't you may well end up like these guys.

German Tax Raid

German Prison!!

[BlasterBates]

Set yourself up as a German Freiberufler (freelancer).

Whatever you don´t tax yourself in the UK, not unless you fancy a spell in jail.

[northernladuk]

Set yourself up as a German Freiberufler (freelancer).

Whatever you don´t tax yourself in the UK, not unless you fancy a spell in gaol.

FTFY

[martinluther]

Thanks Guys, I am not done yet so I would not sign up.

So it means the German Agency doing this stupid thing. Why dont this greedy revenue guys go after the big guys such as these agencies. I smell the whole revenue guys having some setup particularly in UK and in Germany.

[BlasterBates]

I´m sure the agency doesn´t really care how you do it.

The main thing is that you declare your earnings to the German tax authorities to avoid being busted in the future. It´s not tax efficient to use a company in Germany, it´s best to be a "freiberufler". i.e. you send a bill in your own name. You pay tax on that, and if you are tax resident in the UK you declare your earnings and tax already paid. It´s doubtful that you would have to pay any additional tax in the UK because German tax rates are slightly higher.

I would go ans see an accountant (Steuerberater) in Germany. An alternative is to use a reputable management company who will provide the same service. Just make sure whoever is managing you sets you up as a "freieberufler" and doesn´t hide some of your earnings in an offshore bank account.

[SueEllen]

Thanks Guys, I am not done yet so I would not sign up.

So it means the German Agency doing this stupid thing. .

The agency doesn't care how you operate as all the tax problems will be yours.

They just want a worker with your skills on site so they can make money out of the client.

[happyradio]

know the law

I would rather you get to know the law than buckle to the gestapo tactics of the German tax man ... because this is exactly what they want.There is something called a dual taxation treaty signed between the UK and Germany which could be found here http://www.hmrc.gov.uk/taxtreaties/in-force/germany.pdf

read it!!!

The summary is that you can by law work in germany through a uk ltd company for 183 days or less before having to declare taxes to the Germans...If you fly in every week, which loads of contractors do and start Monday around midday & leave friday around midday that is 4 days in the fatherland minus 2 weeks bank holidays plus 4 weeks & 1 day holiday/sickness..you will find it will then fall within the 183 day rule.
If you get a flat in germany then don't keep any of your paperwork there, because the gestapo taxman will hold that as ransome against you
BTW don't touch offshore schemes even with a bargepole

[Brussels Slumdog]

Read Page 17

I would rather you get to know the law than buckle to the gestapo tactics of the German tax man ... because this is exactly what they want.There is something called a dual taxation treaty signed between the UK and Germany which could be found here http://www.hmrc.gov.uk/taxtreaties/in-force/germany.pdf

read it!!!

The summary is that you can by law work in germany through a uk ltd company for 183 days or less before having to declare taxes to the Germans...If you fly in every week, which loads of contractors do and start Monday around midday & leave friday around midday that is 4 days in the fatherland minus 2 weeks bank holidays plus 4 weeks & 1 day holiday/sickness..you will find it will then fall within the 183 day rule.
If you get a flat in germany then don't keep any of your paperwork there, because the gestapo taxman will hold that as ransome against you
BTW don't touch offshore schemes even with a bargepole

Page 17
... shall be taxable only in the first-mentioned State if:
The remuneration is paid by, or on behalf of, an employer who is not a resident of the other State,
Which means that if your end Client is Siemans in Germany
then you need to pay tax in Germany
If Siemans in the UK send you to work in Germany then you pay UK tax. The double taxation agreement does not state how the 183 days are counted in Germany. Do you have a reference either in German or English how they calculate days?