11–20 of 73 posts
If you already have customers, it’s probably a good idea to at a minimum create a legal entity to be liable and insured for the work that you do for said entity.
You have to pay taxes in Germany, it doesn't matter if you found a company in the US, Estonia or somewhere else, you are living in Germany and that's the important thing that decides you need to pay taxes there. In Germany you could do a "Nebengewerbe or Einzelunternehmen", where you can write invoices in your name, this is a fast way to get started. Otherwise you have the UG, which can be created with 1 EUR "Stammka…
> "Nebengewerbe or Einzelunternehmen",
Can I still do this while I have other full-time job ?. In Germany, they have the status of freelancer, and I am not on freelance VISA. I thought that it is only for freelancers.
P.S: feel free to suggest organizations/lawyers/consultants who can help with these matters.
i'm not an attorney, nor should my advice be taken as legal advice. i would strongly suggest getting a lawyer to handle this. i can suggest, however, the main things to consider are separating your personal and business income tax and absolving yourself of personal liability in case something overbearing happens like a lawsuit, these are good things of incorporating. again, i'm not a lawyer, and this is not legal adv…
> i would strongly suggest getting a lawyer to handle this. As stated above, I couldn't find one, someone who can deal with tech-y stuffs here in my area.
You have to pay taxes in Germany, it doesn't matter if you found a company in the US, Estonia or somewhere else, you are living in Germany and that's the important thing that decides you need to pay taxes there. In Germany you could do a "Nebengewerbe or Einzelunternehmen", where you can write invoices in your name, this is a fast way to get started. Otherwise you have the UG, which can be created with 1 EUR "Stammka…
I have my full-time job in Germany. I don't work freelancer as a full-time. This project doesn't take 40 hours week. I built the platform, and now I am maintaining it as a side project. However, I want to make it profitable. > "Nebengewerbe or Einzelunternehmen", Can I still do this while I have other full-time job ?. In Germany, they have the status of freelancer, and I am not on freelance VISA. I thought that it is…
Yes, you can do the Nebengewerbe/Einzelunternehmen while having a full time job. You should create an additional bank account and use that one for your side business, which will make it easier for book keeping (otherwise you have to open your private bank account to the tax authorities). You can also get a VAT ID, if you do EU business outside of Germany.
Freelancer is something else as you might think, some jobs fall in the category of "Freiberufler", which is some creative jobs, etc... All others are simply "Gewerbetreibende".
You can also found a UG/GmbH on the side, you don't need to do it fulltime. You should look in your contract though if there is anything that prevents you from doing so.
Sadly I can't suggest anyone since I had to take care of everything myself as well, I simply work together with a regular tax guy. I am based in Germany as well and started basically the same way as you.
Whether it's a good idea to incorporate while having a job, that depends mostly on your relationship with your employer. Some will care, and some will not.
Earlier quoted context omitted.
That's really bad advise, because he still has to pay taxes in Germany and Atlas creates a huge mess.
Can you describe the mess Atlas creates?
If you're doing a side project for interest, make a little money I don't think its worth it unless you think you could get sued. If its a serious small business maybe there is someone in local government that can help you - maybe even govt/EU grants and such.
If there isn’t one, then it really is no business of your current employer whether you start a company while employed. Still, you should be very careful of anything that might be construed as taking advantage of confidential information gained through your employment. Don’t use your work computer, steer clear of their customers, and so on.
Starting a corporation in a different country can be overwhelming. Estonia is relatively easy compared to other countries but you can’t do everything online.
In particular you’ll need a bank account to receive invoice payments. Are you prepared to travel to Tallinn and visit local banks in person to try convince one to open you a business account? If not, just incorporate in your home country and start with the bank you’re already using.
I’m not a lawyer or financial adviser, but generally and purely anecdotally speaking, taxation of EU corporations isn’t as complicated as some make it sound. If your company pays you a salary, it’s taxed as income. If you pay a dividend at the end of the year, it’s taxed as capital gains. It doesn’t make a substantial difference whether the company is in another EU country.
If you do create an Estonian corporation, there’s one nice thing about their tax law: corporate profits are not taxed until you actually withdraw money as dividends. Most other countries have a corporate tax charged from annual profits, which means that if your Year 1 goes great but Year 2 ends up losing money, tough — you’ve already paid taxes from Year 1 profits so there’s no way to subtract the loss retroactively. In Estonia, if you kept the profit in the company, you’d get to subtract Year 2 loss and pay tax only on the net profit when you finally do pay yourself the dividend.
If you wrote a bug that cost one of your clients to loose a sale you could be personally liable for the full amount.
Just spend an hour doing it and don’t risk losing all of your savings. You don’t want to go to court with a company that has many more resources for lawyer than you.
This is a no brainer. Advice saying not to do it is just plain wrong.
It’s ridiculously easy, you pay your taxes almost identically to how you currently do if you make an LLC and are sole owner.
—edit I see you are not in US. My advice is more specific to US.