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Yet another thread on working within the EU

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    Yet another thread on working within the EU

    Yes there are tonnes of threads but frankly they are as clear as mud.

    So here is the situation.

    Seems that there are lots of companies that are setting up UK contracts to send consultants to other countries. In these cases there is no cross border billing just UK B2B transactions with UK vat paid. There are a fair few angents that are using the line dont worry its paid in the UK you will be fine, to get lower rates. I think this is nowhere near correct but we do not have a good example of what good looks like.

    With this in mind a UK consultancy wishes to engage my UK company on a fixed price piece of work based on UK law.

    Some of the work will require me to pop over to Germany and have some client meetings. I am required to pay for the flights and accommodation in those cases.

    Now the common advice that is on the other threads is:
    Register as a freelancer in Germany. But Im not staying there and as such will not be renting accomodation. As an estimate I intend to be staying no more than 2 days at a time to allow for flight in, meetings then out again...

    However the part that is never discussed is:
    What portion of the cash should be paid in Germany?
    Given that I am basing the work on additional value derived through the work not days worked apportioning £500 a day will not work. As a day taking a client for a meal is not the same as siting in Somerset and planning a thousand server migrations and the automation schemes for that...

    UK how does one account for a reasonable salary paid in the EU country per day vs the overall profit on the job in the UK?

    #2
    It sounds like the client is based in Germany but, other than a few meetings, all the work will be completed in the UK? I'm not sure there is a requirement to register as a freelancer in Germany in that scenario.

    Comment


      #3
      Originally posted by ladymuck View Post
      It sounds like the client is based in Germany but, other than a few meetings, all the work will be completed in the UK? I'm not sure there is a requirement to register as a freelancer in Germany in that scenario.
      I think that would be the best case scenario but I am worried that a few meetings could turn into 2 nights a week in Germany and I guess the part that is missing is what money needs to be brought to germany and taxed in that situation.

      Comment


        #4
        Originally posted by bobspud View Post
        I think that would be the best case scenario but I am worried that a few meetings could turn into 2 nights a week in Germany and I guess the part that is missing is what money needs to be brought to germany and taxed in that situation.
        Tax is due where the work is done, that's the mantra.

        As Sue at iPaye says, meetings vs work assignments - those are the two main issues.

        Comment


          #5
          My issue would be paying for the flights and accommodation for those meetings.

          My viewpoint is that I won’t pay for them as it minimises the incentive to call such meetings and further emphasises where the work is taking place.
          merely at clientco for the entertainment

          Comment


            #6
            Originally posted by stek View Post
            Tax is due where the work is done, that's the mantra.

            As Sue at iPaye says, meetings vs work assignments - those are the two main issues.
            But I think those points have more sway in the case of a foreign contract to a British worker. My company would have a UK contract and remain in the UK the contract is fixed price not T and M and could include further workers.

            There will obviously be a EU / UK contract somewhere but I regard that one as the problem of the consultancy up stream.

            Who I send and when would be my companies choice. So the problem is what tax if any would need to be declared to the Germans? Case in point I may have a budget of £1000 per day but choose to send a requirements specialist over on £100 a day instead of me.

            So would the Germans expect to take the tax on a 100 days of £100 or the whole contract value that was paid to the company?

            Comment


              #7
              Originally posted by eek View Post
              My issue would be paying for the flights and accommodation for those meetings.

              My viewpoint is that I won’t pay for them as it minimises the incentive to call such meetings and further emphasises where the work is taking place.
              They (the client co) won’t recompense you these costs?

              Seems a tad ... cheeky?

              Comment


                #8
                Originally posted by bobspud View Post
                Some of the work will require me to pop over to Germany and have some client meetings. I am required to pay for the flights and accommodation in those cases.

                Now the common advice that is on the other threads is:
                Register as a freelancer in Germany. But Im not staying there and as such will not be renting accomodation. As an estimate I intend to be staying no more than 2 days at a time to allow for flight in, meetings then out again...

                However the part that is never discussed is:
                What portion of the cash should be paid in Germany?
                Nothing. You are only going there for meetings etc, while the actual work is being performed elsewhere.

                I do this all the time (my main job is increasingly becoming that of selling the services of other people rather than myself around the EU).

                Comment


                  #9
                  Thanks everyone.

                  I have opted for another contract based at home instead but I think this will be coming up more frequently as more agents seem to want Brits on the continent.

                  Comment


                    #10
                    If you spend only a two or three days a month in Germany and you go for meetings these will be seen as business trips, I don't see any problem there. In any case you won't get over the tax threshold.

                    Once it gets beyond a week a month it gets more complicated, i.e. if they add up the hours and you could potentially be paying some tax then it moves into the grey area, where you need some advice.
                    I'm alright Jack

                    Comment

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