European Tax Advisor

Macker007

Folks,

Hoping someone will be able to recommend a tax advisor who specialises in European taxation.

My situation is that I have been offered a contract position by a UK company working in Germany. The UK company is willing to pay for me to fly home each weekend to Ireland. I have my main residence here in Ireland and my wife will remain resident here.

I have been to a couple of accountants for advice as to how to best manage my tax situation. None seem to have an understanding of tax laws in Germany & the UK.

Has anyone any recommendations ?

srsly78

Very complicated area, needs specialist advice.

One of the important considerations is how long the contract is, and how long you would be resident in Germany for. If you just went to Germany for a short business trip you may not be tax resident there. However if you spend 183+ days a year there then you probably are. Note many criteria come into it, the 183 days thing is just one of the many guidelines.

Macker007

srsly78 wrote: »

Very complicated area, needs specialist advice.

One of the important considerations is how long the contract is, and how long you would be resident in Germany for. If you just went to Germany for a short business trip you may not be tax resident there. However if you spend 183+ days a year there then you probably are. Note many criteria come into it, the 183 days thing is just one of the many guidelines.

The contract length will be minimum 12 months and maximum 24 months so well exceeds the 183 days.

srsly78

Are you PAYE through your UK employer, or are you a self-employed contractor that issues invoices to customer/employer?

Can't give advice but you will be paying German tax, and possibly making returns in the UK/Ireland too.

Talk to an international tax advisor, not an accountant.

Macker007

srsly78 wrote: »

Are you PAYE through your UK employer, or are you a self-employed contractor that issues invoices to customer/employer?

Can't give advice but you will be paying German tax, and possibly making returns in the UK/Ireland too.

Talk to an international tax advisor, not an accountant.

I am being given the choice of either. I was toying with the idea of contacting an umbrella company in the UK so as to avoid setting up a company in the UK.

srsly78

Very very awkward situation, splash some cash on professional advice tbh.

Avoid umbrella companies like the plague, they are parasites that will increase your tax liability. They are only good for quickies, ie if you don't intend being self-employed for long.

Also note in my experience Germany is not a "contractor friendly" country.

Macker007

srsly78 wrote: »

Very very awkward situation, splash some cash on professional advice tbh.

Avoid umbrella companies like the plague, they are parasites that will increase your tax liability. They are only good for quickies, ie if you don't intend being self-employed for long.

Also note in my experience Germany is not a "contractor friendly" country.

Thanks for your help srsly78.

I'm going to contact a tax advisor in the UK tomorrow and make an appointment.

Sean Bateman

You probably won't find a single tax advisor who can help you. Advisors in a particular jurisdiction generally aren't competent to advise on specific foreign tax queries. The trick is to go to an advisor with an office or an affiliate in the relevant jurisdictions(s). If money's no object, go to a "Big 4" firm. If cost is an issue, go to a "Top 20" firm that's a member of a foreign tax network or has good foreign affiliate firms. Your local advisor will then "project manage" the compilation of the advice for you.

Best of luck.

Mr. Incognito

Sean Bateman wrote: »

You probably won't find a single tax advisor who can help you. Advisors in a particular jurisdiction generally aren't competent to advise on specific foreign tax queries. The trick is to go to an advisor with an office or an affiliate in the relevant jurisdictions(s). If money's no object, go to a "Big 4" firm. If cost is an issue, go to a "Top 20" firm that's a member of a foreign tax network or has good foreign affiliate firms. Your local advisor will then "project manage" the compilation of the advice for you.

Best of luck.

This is nonsense. I am an Irish tax advisor, have a working knowledge of UK tax and would take me about twenty mins to read up on basic German income tax. I also have a working knowledge of Swedish, French and Spanish tax as I have had to deal with these through work.

I however charge for this advice,

Marcusm

Your issues are most likely to relate to Irish and German tax. The UK employer will have its own issues in ensuring that it gets clearance not to apply UK PAYE to your pay. However, as it sounds that you are not being engaged for any duties in the UK, that should be fairly simple for them to arrange. Depending on their establishments in Germany etc, they may have obligations to deduct tax at source in respect of Germany.

The basic provision of the double taxation agreement between Ireland and Germany applicable to employees is as follows:

Article XII

Subject to the provisions of Articles XIII, XIV, XV and XVII salaries, wages and other similar remuneration derived by a resident of a Contracting State in respect of an employment shall be taxable only in that State unless the employment is exercised in the other Contracting State. If the employment is so exercised, such remuneration as is derived therefrom may be taxed in that other State.
Notwithstanding the provisions of paragraph 1 above, remuneration derived by a resident of a Contracting State in respect of an employment exercised in the other Contracting State shall be taxable only in the first-mentioned State if:
The recipient is present in the other State for a period or periods not exceeding in the aggregate 183 days in the year of assessment concerned, and
The remuneration is paid by or on behalf of an employer who is not a resident of the other State, and
The remuneration is not deducted from the profits of a permanent establishment or a fixed base which the employer has in the other State.
Notwithstanding the preceding provisions of this Article remuneration for personal services performed aboard a ship or aircraft in international traffic may be taxed in the Contracting State in which the place of effective management of the enterprise is situated.

Both Ireland and Germany operate a caledar year tax basis period which removes one complication which can arise in circumstances such as these. It seems, based on your initial comments, that you are unlikely to spend more than 183 days in Germany in 2012.

Ultimately, you need to get advice from someone such as Mr Incognito - the issues are more related to the determination of taxing rights as between the countries.

Sean Bateman

Mr. Incognito wrote: »

Sean Bateman wrote: »

You probably won't find a single tax advisor who can help you. Advisors in a particular jurisdiction generally aren't competent to advise on specific foreign tax queries. The trick is to go to an advisor with an office or an affiliate in the relevant jurisdictions(s). If money's no object, go to a "Big 4" firm. If cost is an issue, go to a "Top 20" firm that's a member of a foreign tax network or has good foreign affiliate firms. Your local advisor will then "project manage" the compilation of the advice for you.

Best of luck.

This is nonsense. I am an Irish tax advisor, have a working knowledge of UK tax and would take me about twenty mins to read up on basic German income tax. I also have a working knowledge of Swedish, French and Spanish tax as I have had to deal with these through work.

I however charge for this advice,

I do not agree with you and I don't believe that the ITI would either.

I've a working knowledge of UK tax too but I would not give formal advice (or charge for same) on the basis that I do not hold a UK tax qualification.

Mr. Incognito

Sean Bateman wrote: »

I do not agree with you and I don't believe that the ITI would either.

I've a working knowledge of UK tax too but I would not give formal advice (or charge for same) on the basis that I do not hold a UK tax qualification.

The Irish qualification is cross recognised in the UK.