Peter Scheller
Berater für Wirtschaftsprüfer, Rechtsanwälte, Steuer- und Unternehmensberater

„Wenn es knifflig wird.“

German social security: The need for an Authorized Representative

von Peter Scheller

From 1 January 2021 foreign employers are obliged to appoint an Authorised Representative when they employ staff who will be liable to German social security contributions. This obligation is applicable for employers who do not have a registered office in Germany.

The Authorised Representative has to take over the obligations of the employer. He or she has to pay the social security contributions, keep remuneration records and store them until the end of the calendar year following the last audit of the German social security agencies.

The representative can also be the employee.


  1. The foreign employer is not allowed to withhold German withholding payroll tax if he/she has no permanent establishment or permanent representative in Germany. The only exemptions are for employers who conduct personnel leasing or for German subsidiaries of foreign employers. The employee has to declare salaries and fringe benefits in his or her income tax return.
  2. This new rule also applies to employers from the UK. Article SSC.14 of the Protocol on Social Security Coordination (Trade and Cooperation Agreement EU/UK) states that an employer without a registered office or place of business has to fulfil all relevant obligations in the other state when the employee is subject to the social security system in this other state. However, the employee may agree to fulfil the employer’s obligation on his/her behalf. In this instance the employer has to inform the competent institution in the other state.
  3. No representative is required if the employee has been sent to Germany under an assignment contract. For more information see here.

Author: Peter Scheller, German tax adviser, Master of International Taxation





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