Unique Working situation - Part Germany Park UK

[blacksta]

I have seen the working in Germany thread and have searched the forum and cant find anything relevant to my unique situation.

My Company has been tasked to provide services to a company with an office in the UK and rest of Europe. The current schedule is 3 weeks in Germany and 1 week in the UK ( either home based or at the local UK office). ongoing. ( The may also change to 2wks in Germany and 2 wks in UK)

It is looks like contract for services was initiated by the UK branch therefore will able to claim VAT. (I am assuming).

The current arrangement is with the UK company via a UK recruitment agency.

Payment is also in UK Sterling

Where do i stand on the following

1. Claiming VAT
2. German Authorities ( do i need to inform them as the contract is with a UK agency + UK company)
3. IR35


I want to do the right thing ( dont have any qualms sorting out the German side)


Thanks Guys

[yasockie]

Is your client a UK company or not?
If you plan on sending invoice to the UK subsidiary, I don't see how DE Hector can reap into that.

[BlasterBates]

It doesn´t matter where the invoice is paid. Plenty of UK contractors in Germany invoicing a UK agency have been clobbered by the German tax authorities.

If you are selling goods to Germany you invoice a German company you still pay UK tax if you made those goods in the UK.

However you´re right in the sense the German authorities wouldn´t easily be able to find out, other than if you spend a lot of time there and they get suspicious as to what you´re doing there. It certainly wouldn´t be picked up in an audit.

Though I think there are two questions. Do you want to do it legally and above board or do you just not want to get caught. Personally I would want to do it all legally because firstly you probably won´t save much in tax and secondly if you did get caught however unlikely it would be really awful.

[blacksta]

Is your client a UK company or not?
If you plan on sending invoice to the UK subsidiary, I don't see how DE Hector can reap into that.

It is a company with presence in the UK and Germany. Payment is actually received by the UK agency from the Uk subsidiary.

[blacksta]

It doesn´t matter where the invoice is paid. Plenty of UK contractors in Germany invoicing a UK agency have been clobbered by the German tax authorities.

If you are selling goods to Germany you invoice a German company you still pay UK tax if you made those goods in the UK.

However you´re right in the sense the German authorities wouldn´t easily be able to find out, other than if you spend a lot of time there and they get suspicious as to what you´re doing there. It certainly wouldn´t be picked up in an audit.

Though I think there are two questions. Do you want to do it legally and above board or do you just not want to get caught. Personally I would want to do it all legally because firstly you probably won´t save much in tax and secondly if you did get caught however unlikely it would be really awful.

I want to do it legally, on paper it is looks i am working for the Uk company but based in Germany for every 3 weeks in a month. I am assuming there will be no audit trail back to Germany but i would rather do the right thing.

I am also concerned of the need of starting any unnecessary paper work.

[BlasterBates]

I want to do it legally, on paper it is looks i am working for the Uk company but based in Germany for every 3 weeks in a month. I am assuming there will be no audit trail back to Germany but i would rather do the right thing.

I am also concerned of the need of starting any unnecessary paper work.

I would aim to tax yourself in both countries, and setup with a German accountant and a UK accountant. You could try SJD (Simon Dolan), as I think they work together with German accountants.

http://www.sjdaccountancy.com/about/.../our_team.html

Basically the way I see it is you want to be open and declaring the income and then let the accountants/tax authorities sort out how much tax if at all. ie if you do not pay tax in one or the other countries then all well and good. The way I see it this is sufficiently complex that approval would be required from the relevant tax authority. It would be risky to not declare, in particular as you may unwittingly become fully tax resident in Germany.

It is complicated and even experienced accountants have difficulty with this, and you do need assistance from accountants in both countries.

Working in different countries regularly has a rather large overhead on tax compliance, the only way you can avoid that is not to do it. i.e. negotiate working remote with occasional visits (5 days or less a month).