Living in UK, Employed in Germany, Where to pay taxes?

andre_xs

Dear All,
soon we'll have the following situation for my wife:
She will be officially employed in Germany, but will work in the UK virtually the whole year (home office). As far as I understood she has to pay taxes (and NI) in the UK, because she is resident here. I guess in Germany she has to somehow tell the employer and/or the German inland revenue/tax office that she has to get paid out the gross salary (without any deductions). Then, she somehow has to inform the HMRC that she pays taxes and NI here, and has to pay the according taxes/NI.

Is that correct, and (if so), does anyone know how to actually do these steps?

Some more background information: We both are German nationality, I have a permanent job here (employed, paying PAYE). She never worked in the UK before, i.e. doesn't have a NI number yet.

Best wishes,
Andre

xylophone

http://www.hmrc.gov.uk/gds/nic/work/embassy.htm
may be worth a look - your wife can contact HMRC for guidance.

sheramber

some information here
https://www.gov.uk/tax-foreign-income/overview

You may find she is taxed in Germany and reports her foreign income to HMRC on a self assessment tax return. She would claim foreign tax credit relief for the tax deducted in Germany to be set off against her tax liability in UK.

For National Insurance Contributions she will need to contact the National Insurance office giving them full details

https://www.gov.uk/government/organisations/hm-revenue-customs/contact/national-insurance-enquiries-for-employees-and-individuals

madgagoo

sheramber wrote: »

some information here
https://www.gov.uk/tax-foreign-income/overview

You may find she is taxed in Germany and reports her foreign income to HMRC on a self assessment tax return. She would claim foreign tax credit relief for the tax deducted in Germany to be set off against her tax liability in UK.

Not necessarily, depends on the employer, where she is paid from, whether the employer has a permanent office in the UK, whether any work is done in Germany..... in all likelihood the UK has first taxing rights and Germany should be taking a credit for UK taxes paid.

Can be a very complex situation and you need a good understanding of double tax agreements to get the position correct.

OP feel feee to PM if you'd like more help!

Cook_County

Your wife's employer cannot ignore its obligations under English or Scottish employment law. This includes a local employment contract; auto enrolment into a UK pension plan and other UK based benefits. The employer may have UK corporate tax to address; especially if your wife is considered a PE of the German company. Ask the employer to share with her copies of the professional advice they have received on her tax, NIC & legal position.

Couvert

Hi,
I was hoping if anyone would be able to help. For a year I worked in Germany but continued to live in the UK with my family. I basically commuted every weekend/holidays between Frankfurt and London. For the time I had the job in Frankfurt, I paid full taxes locally. I need to fill out tax return for 2017/18 and would like to understand where I include the foreign income from employment in Germany - is it under the Employment session or Foreign session - and how to claim tax relief on the tax I have already paid in Germany? Any guidance would be very much appreciated!