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Ask HN: Germans, how to work legally remote?

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Re: Ask HN: Germans, how to work legally remote?

#81

Post by throwaway9283i »

helge5 wrote: post #75
leethargo wrote: post #69

Earlier quoted context omitted.

Thanks for the hint about Statusfeststellungsverfahren, I will research that. I had previously filled the questionaire from Finanzamt and they had accepted my status of "freiberuflich" w.r.t. software dev. The possibility to use private insurance depends on having some minimum amount of income. Also, I currently use the option to use public insurance (voluntarily) so that I can easily switch back to it once I become…

"Statusfeststellungsverfahren" is an (gov) insurance thing (the process is run by the "Rentenversicherung" (the pension fund)), it has (I think, not a lawyer) nothing to do with the Finanzamt (German IRS). That is an entirely different thing. > The possibility to use private insurance depends on having some minimum amount of income. This is incorrect. If you are self-employed you are off the state records. You can yo…

I might be wrong, but they only have to take one if you are below a certain age _and_ below the border income (Beitragsbemessungsgrenze). Always be careful w.r.t. these kinds of decisions because they could cost you an awful amount of money later.

Re: Ask HN: Germans, how to work legally remote?

#82

Post by helge5 »

helge5 wrote: post #76
throwaway9283i wrote: post #71

Earlier quoted context omitted.

Depending on your health records, staying voluntarily in the public insurance is the best thing you can do.

That is the way more ethical thing, but it is almost never the best thing from either a financial and certainly not from a health perspective _if_ you exceed a certain income (and the barrier here is pretty low unless you have many kids, which depending on your income distribution you may have to privately insure separately). If you are self-employed, the public insurance is really nothing more but another (rather un…

@throwaway9283i - I think you are indeed wrong.

AFAIK if you are self-employed the gov insurance doesn't have to take you either! Yet both have to take you using that "base tariff" (600? Euro or sth) since a few years (before a self-employed could end up w/ no insurance at all, not possible anymore).

It is true that the private insurance increases significantly over the years, but it is still WAY less than the gov insurance. The costs for the gov insurance is about 25% of your salary (remember, it's split between employer and employee, but as a self-employed you have to pay both sides). Assuming an income of just 5k per month, that would be 1.25k! per month, or more than twice the base tariff.

It often becomes problematic for self-employed low-wage workers when they enter pension. Which they often don't setup, and hence can't even pay their health insurance :-/ (and then move into social security, which again provides everything)

That it is difficult to get back to the public insurance is just non-sense unless you exceed a certain age. In fact you have to, whether you want or not, by law.

Re: Ask HN: Germans, how to work legally remote?

#83

Post by helge5 »

throwaway9283i wrote: post #81
helge5 wrote: post #75

Earlier quoted context omitted.

"Statusfeststellungsverfahren" is an (gov) insurance thing (the process is run by the "Rentenversicherung" (the pension fund)), it has (I think, not a lawyer) nothing to do with the Finanzamt (German IRS). That is an entirely different thing. > The possibility to use private insurance depends on having some minimum amount of income. This is incorrect. If you are self-employed you are off the state records. You can yo…

I might be wrong, but they only have to take one if you are below a certain age _and_ below the border income (Beitragsbemessungsgrenze). Always be careful w.r.t. these kinds of decisions because they could cost you an awful amount of money later.

If you are above the border income, the private version is less expensive (I might also be wrong, checkout https://www.finanztip.de/pkv/pkv-basistarif/). It only really affects people below that income (way too many!). It is the reverse, staying in the gov insurance costs you an awful lot of money upfront. It's the ethical but financially stupid thing.

Re: Ask HN: Germans, how to work legally remote?

#84

Post by helge5 »

throwaway9283i wrote: post #79
movingbritde wrote: post #72

I'm in a similar situation, except I'm a British citizen looking to move to Germany. I already have a sole director, UK limited company set up for contracting / freelancing. I've head rumours of German contractors using UK limited companies instead of the local GmbH/UG entities. How does that work generally? Are people setting themselves up as German employees of the UK entity and collecting a salary? Or is there som…

Without being able to contribute to your question: in hindsight of Brexit (UK will leave the EU) this might not be possible (as easy?) as in the past anymore.

I think the "only" real change is that he will need a work visa, the other aspects should remain the same. A EU citizen can freely choose his workplace in the EU (which is a reason why the British voted exit, they specifically didn't want that).

Re: Ask HN: Germans, how to work legally remote?

#85

Post by rooam-dev »

cygned wrote: post #25
jotm wrote: post #22

Earlier quoted context omitted.

How so? Is there a problem with having a company with only one employee and one client?

Yes, if you have an incorporation (UG/GmbH/...) where you are the only managing partner (Ein-Personen-GmbH) and you only have one client, you’re handled as if you were a freelancer with only one client. It was an easy way to circumvent several obligations until they “closed” that “loophole”.

Could you be more specific what loophole?

I am in a similar situation, I am full time employed (as a developer) by 1 person GmbH. I work with a tax agency that has not said anything about this.

Thanks.

Re: Ask HN: Germans, how to work legally remote?

#86

Post by dx034 »

cygned wrote: post #70
throwaway9283i wrote: post #62

Earlier quoted context omitted.

Can you go more into detail regarding the tax stuff? Who pays the VAT then?

In countries that have a tax agreement with Germany (e.g. Canada), the Reverse Charge procedure is used; you signalise that on your invoice. In that case, the customer is obligated to pay the VAT in their country and you bill the net amount. However, that depends on the service/product sold. If you re-sell development services, for example, you still have to pay VAT in Germany on a part of the amount billed while the…

In addition, as the US has no VAT (sales tax is different from VAT), reverse charge then leads to no VAT being charged at all.

Re: Ask HN: Germans, how to work legally remote?

#87

Post by dx034 »

helge5 wrote: post #76
throwaway9283i wrote: post #71

Earlier quoted context omitted.

Depending on your health records, staying voluntarily in the public insurance is the best thing you can do.

That is the way more ethical thing, but it is almost never the best thing from either a financial and certainly not from a health perspective _if_ you exceed a certain income (and the barrier here is pretty low unless you have many kids, which depending on your income distribution you may have to privately insure separately). If you are self-employed, the public insurance is really nothing more but another (rather un…

That's not necessarily true. It depends on how many kids you'd want to insure (they're free on public insurance but cost on private), if you have any risk factors (even common allergies can drive up the price of private insurance a lot), your income later in life and health inflation. Over your lifetime it's not unrealistic that you're worse off with private insurance. So unless you're keen on that higher level of care (or luxuries as it's mostly about waiting times rather than getting care at all), staying in public insurance can be smart even if you pay the maximum amount.

Re: Ask HN: Germans, how to work legally remote?

#88

Post by dx034 »

helge5 wrote: post #82
helge5 wrote: post #76

Earlier quoted context omitted.

That is the way more ethical thing, but it is almost never the best thing from either a financial and certainly not from a health perspective _if_ you exceed a certain income (and the barrier here is pretty low unless you have many kids, which depending on your income distribution you may have to privately insure separately). If you are self-employed, the public insurance is really nothing more but another (rather un…

@throwaway9283i - I think you are indeed wrong. AFAIK if you are self-employed the gov insurance doesn't have to take you either! Yet both have to take you using that "base tariff" (600? Euro or sth) since a few years (before a self-employed could end up w/ no insurance at all, not possible anymore). It is true that the private insurance increases significantly over the years, but it is still WAY less than the gov in…

> It is true that the private insurance increases significantly over the years, but it is still WAY less than the gov insurance. The costs for the gov insurance is about 25% of your salary (remember, it's split between employer and employee, but as a self-employed you have to pay both sides). Assuming an income of just 5k per month, that would be 1.25k! per month, or more than twice the base tariff.

It's actually about 15% in total. The maximum amount currently is around €750 for both employer and employee.

Re: Ask HN: Germans, how to work legally remote?

#89

Post by cntlzw »

johannes1234321 wrote: post #40
helge5 wrote: post #26

Earlier quoted context omitted.

Just a small clarification: You are still "selbständig" (self-employed) if you do a "Gewerbe". The thing you don't get easily is a so called "Freiberuf", particularly if you don't have an engineering degree (though I managed to get it). Tax wise it is actually almost easier to do non-EU business than doing business in Europe, because there are no VAT issues involved (and there are no tariffs on those things). You jus…

The difference between "Gewerbe" and "Freiberufler" ist quite grey. I'm the software field I have often seen the distinction between creating software on your own (creative/artistic work - freier Beruf) vs. implementing other's requirements (production - Gewerbe) but in each case it depends on the tax officer looking at the files.

Yes, unfortunately. With a degree in CS you might get away with Katalogberuf: no Gewerbe, no Gewerbesteuer

Re: Ask HN: Germans, how to work legally remote?

#90

Post by cntlzw »

skrebbel wrote: post #39
ohthehugemanate wrote: post #7

I did this for a few years. Here are your options: Employment by the US company: They're allowed to employ you and have you "stationed" in Germany. You pay no US tax, and DE tax on 100% of this income. For Sozialversicherung, Rentenversicherung etc it's just as if you were selbständig. Since you're allowed to give up all sorts of rights in DE conteact Law, the US based contract is probably fine. Contractor for the US…

> since I dont have a degree in CS, I can't be selbständig in that field Wtf? Is there a rationale for this rule or is it just German's super weird "degrees are everything" culture turned to law? (I'm Dutch, were basically Germans who talk funny, but I'm very happy we don't have rules like these)

Anyone can be selbstständig. Anyone can have a GmbH. Question is if you need to pay Gewerbesteuer. If you have a so called Katalogberuf you might be allowed to call yourself Freiberufler. They are exempt from Gewerbesteuer.
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