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

„Wenn es knifflig wird.“

German social security: The need for an Authorized Representative

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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.

Note:

  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

Bildquelle: www.fotalia.com

 

 

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Kommentare

Kommentar von Fania |

Hi there. This was a fantastic article, thank you.
May I please ask, if I am an EU-Citizen with residence in Germany under 183 days under a tax treaty (to finish the job before the 183 days), yet my non-EU job (while they don't mind me working from anywhere), will *not* assist in any social/tax issues, can I simply nominate myself and accept the fact I must pay social insurance twice?
Do I have to involve my employer at all, do they need to nominate me or can I just present to the authorities with all that's required with help of an accountant?
In the event I can do it all myself and take the hit of both halves of German social security, can I still have public insurance not private ? (I am concerned I won't be able to go back to public).

Thank you for your attention.

Antwort von Peter Scheller

I think you need professional support.

First has to be analyzed whether you are tax resident in Germany: https://scheller-international.com/blog-beitraege/german-tax-residence.html

Then you have to find out whether you are liable to German social security contributions.

Taxes and social security contributions are not directly linked to each other in Germany.

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