2

The German employer will be paying into my UK account.

I'm confused as to whether I should be paying UK or Germany income tax / national contributions, or both.

Any guidance would be much appreciated.

2

I understand where and to whom you pay taxes depend on how and where you're registered as a taxpayer. In my case, I'm a tax-payer resident in the the UK (Mexican nationality). My clients are from the UK and abroad, mostly in Denmark, but I only pay taxes here in the UK, not Denmark or Mexico, because I'm registered as a sole-trader in the UK and here's where I live for more than 6 months per year. If you're a UK citizen, most likely you have to pay taxes only in the UK, unless you have dual citizenship/residency.

Maybe the info in this page might help you.

1

As a UK Resident, you will be liable for UK tax on all your income, whether it’s from the UK or abroad.

https://www.gov.uk/tax-foreign-income/residence

However, if you are working as an employee for a German company, you will be subject to payroll deductions in Germany. The same applies if you are working through an agency, due to the German equivalent of IR35, which treats [most] labour-only agency workers as employees for tax purposes.

This brings you into scope of the double-taxation treaties, whereby the tax you pay in Germany will offset your UK liability on that income.

If you are B2B subcontracting to a German company, then the tax situation gets a bit more complicated...

As a word of warning: overseas income by UK residents is one of HMRC's hot topics at the moment... my recommendation would be to take professional advice, to ensure you (a) maximise any allowances but (b) pay all tax due while (c) not paying too much.

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Not the answer you're looking for? Browse other questions tagged or ask your own question.