The progressive income tax: A Tale of Three Brothers
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Germany is a rich and technologically based economy and is the fifth largest economy in the world 98 people work in agriculture and industry with only 2 in the service industries.
German labor law has not been consolidated into a single labor code Instead, based on the provisions of the service contract of the German Civil Code and several collective agreements individual laws have full legal status and the right of collective work is one the few areas where the law has developed a systematic set of rights.
Working hours Working hours and breaks are governed by Arbeitszeitgesetz law on working hours, collective agreements and company agreements, or arranged on an individual basis.
The normal length of work week varies between 38 to 40 hours, according to the collective wage agreement Normally the working day does not exceed eight hours employees can not normally be required to work on Sundays and public holidays There are exemptions for many activities.
More than 28 of all employees now working flexi-time with flexi-time, there are core hours during which all employees must be present in working employees the option of working hours more or less in limits.
Overtime can be built up to a point of electronic time recording systems and working time accounts have been established in many companies to record the hours worked by each individual.
Holidays and Leave The collective agreements provide for leave of 30 working days for most employees varies right across Germany as the working days are Monday to Friday, this amounts to six weeks' wages of a person continues be paid in full during this period Anyone who regularly performs heavy work or hazardous normally receive additional leave full entitlement from is acquired only after the employment relationship has existed for six months.
Sick leave in case of illness, the employee must inform the employer as soon as possible in case of an illness that lasts more than three days, an employee must present any certificate from a doctor at the latest the next business day .
Parental leave During parental leave the employer provides parents from work without pay to care for their newborn child The working relationship is suspended during parental leave, however, parental leave also gives male and female employees the opportunity to work part time so they can care for their children while continuing their work each parent is entitled to parental leave until their child reaches the age of three.
The educational leave employees can take training leave for training Use it for your own political, language courses or further vocational training.
Holidays 1st January 6 January 21 March 24 March, 1 May, 12 May, 22 May, 15 August, 3 October, 31 October, 1 November, 19 November and 25-26 December.
Your treatment will depend on your residence and the duration of the work assignment 183 day rule.
If you are in the country for 183 days or more during a calendar year or an average of 90 days over a period of four years, you are deemed to be a tax resident A similar test exists in most European countries.
Travel days are normally excluded and only passed whole days in the calculated country, but in the UK in recent years, the time spent traveling is an account abroad and there are limits.
Leaving the UK, you must complete the notice of P85 to the UK Revenue.
Also solidarity surcharge Solidaritaetszuschlag is generally 5 5 out of the income tax to pay for all of the highest taxpayers.
Individual tax rates in Germany are progressive taxes on profits have recently been reduced, and the top marginal rate is 45 by law, employees pay as they earn a mandatory fee of about 20-21 of them pay for their individual social security the same amount is paid by the employer.
In Germany, for tax purposes you are either a resident or non-resident If you have been present in Germany for more than 183 days, you are usually considered a resident for tax purposes The 183-day rule is not single tax residence If you are considered a non-resident for tax purposes, you still pay the tax generally be responsible on the German original income, the rate may vary; tax and double taxation agreements can change this There are 6 tax classes that you can fall, each with varying rates.
Single or separated, but do not fall into either category 2 or 3.
Separate and unique, with a child, entitling them to the allocation of a child.
Married, widowed or who are employed in the first year of the death of a spouse.
Married people who usually fall into the category 4, but whose spouse is tax class 3.
Employees who receive income from another job on one or more different tax cards.
In addition to this, you can be a doctor or an employee of such independent and free Freiberufler professionals, architects or contractors to employees, tax and social insurance are deducted by the employer entrepreneurs must pay the tax services their tax obligations regularly throughout the year.
Expatriates can enjoy the generous German social security benefits while living here and even, in some cases, when they go home.
Germany has a complex system of social security which ensures that its citizens live comfortably, even if they're Expatriates sick, disabled, unemployed or retired may also participate in the system to a large extent.
People with a job are, as a rule, make payments to the four parts of the system for health insurance, long-term nursing care, pensions and unemployment payments These usually come in about 40 of gross income, but employer normally pays half of the cost, which means that the employee is out of pocket by only 20 of its revenues other pillars of the social security program are the accident insurance company, paid entirely by the employer and social benefits, the state handles.
The premiums depend on income more it is to be paid, up to a certain limit in 2010, the premium is about 15 of gross income for health insurance, the exact amount depending on the insurance company people earning more than 49950 monthly year 4163 may be able to choose their own private health plan if they meet certain criteria for long-range care insurance payment is January 95 or 2 2, also until 4163 the income limits 2010 for pension and unemployment insurance are 5,500 in the former West Germany and 4650 in the former east Germany the costs are September 19 for pension insurance and 2 8 UI unemployment burden may increase to 3 in mid-2010.
If you have any questions about contracting or would like further advice please call our international team on freephone 0500 152500 01442 275789 or email Antony Edwards.
International Umbrella already know SJD International, skills and experience to support entrepreneurs who work abroad ensure they work efficiently and comply with the tax.
Contractor abroad can bring many rewards but also entails additional responsibilities and challenges with regard to tax and in the country in accordance Few companies offer support to British entrepreneurs and non-British working abroad However, Umbrella International has the skills and experience to support entrepreneurs working abroad ensure that they function as intended and tax efficient.
If you wish to discuss contracting or abroad have questions about tax please call Freephone 0500 152500 01442 275789 or email.
Tax rate in Germany, prices, Germany, 01442 275789 email, 0500 152500 01442.