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My husband and I are headed to Germany with my company. We will have residents permits and understand my husband is authorized to work there on his spousal visa. However, as a software engineer he would like to work for a US company remotely (no presence in Germany). We're having a hard time finding specific information about this scenario. Here are our questions: 1. Would this jeopardize my visa? 2. Would this compromise the US employer's compliance with any regulations, tax or otherwise? 3. If it is in fact allowed, does my husband pay German universal tax or are his W2 wages exempt under the US German tax treaty?

Thanks! K

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  • There are in fact 3 separate questions that I would take one at a time. Unfortunately I don't have a solid answer--I was in a similar boat and it's impossible to find clear answers. First of all, for his company he'll have to ask them if they have a way to keep him on payroll overseas. IIRC if he's working in Germany he (and by extension the company, on his behalf) need to be paying taxes in Germany. So they need to be set up to do that. If they aren't, they may still be able to hire him as an independent contractor (this is what I almost did with my company).
    – Iguananaut
    Dec 9, 2016 at 12:33
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    You'll also want to check on the terms of your residents permit on what work he can or can't do. They may have specific terms lined out, or they may not--I'm not familiar with Germany specifically in this regard. When it comes to taxes I'm not entirely sure myself and am trying to figure this out too (in France, but similar scenario). At the end of the day I'm going to just hire a tax expert to sort that out for me. But first you want your husband to ask his HR department if they're even set up legally to do so.
    – Iguananaut
    Dec 9, 2016 at 12:36

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  1. Would this jeopardize my visa?

As far as I understood you, he is with you and has a residence permit (which nowadays automatically includes a working permit, it should say so). No, I don't see why this would in any way interfere with your Visa, it's completely legal.

  1. Would this compromise the US employer's compliance with any regulations, tax or otherwise?

Not any German regulations. For US regulations, it doesn't compromise it's compliance with government regulations, but many large corporations have in-house compliance standards your employment profile might not work with. See the next point.

  1. If it is in fact allowed, does my husband pay German universal tax or are his W2 wages exempt under the US German tax treaty?

Depends.

If he gets to be a regular employee of a US company (legal, but in-house compliance of the company may not like it) he pays taxes in the US and has to file taxes in Germany as well. However, he can file his taxes paid in the US to the German authorities, so he does not get taxed twice on the same salary. It's called DoppelBesteuerungsAbkommen and I suggest you get a German tax accountant to file for you.

Alternatively, he can become a Freiberufler (freelancer) or Selbstständiger (S-Corp equivalent). This way he can write invoices to whoever he wants and only pays taxes in Germany. Whether the US company will accept freelancers from other countries invoicing them is a matter for their compliance department. Some do, some don't. Although the Finanzamt (German IRS) is a big help and very forgiving to people starting a business, I would advise a tax accountant for this, too.

As a regular German employee, health insurance automatically comes as part of the job. With both models detailed above, you will need to find your own.

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