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German employee

German employee

We are a UK company and are considering employing a German national who currently lives and works in the UK. However, his employment with us would involve him moving back to Germany, from where he would be based. What is the simplest way of setting this up? I foresee horrible administrative problems with payroll and benefits - is this the case?
Clare Beazley


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15th Oct 1999 13:20

German employee - use a Lohnbüro
One solution is to treat him as a normal employee and use a Lohnbüro (=Payroll Bureau) to calculate his German payroll deductions and do the paperwork. Any German tax consultant can recommend a Lohnbüro. It's not cheap for a payroll of one, but Lohnbüros specialise in servicing firms which are too small to have their own payroll dept, so it is quite common.

Another solution is to treat him as self-employed and pay him gross, but this is dangerous : if (ie when) a German government auditor classes him as employed, there may be a big back liability plus penalty payments.

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