Chesterfield (London) 
207 Old Marylebone Road
Tel: +44 (0) 203 771 3853
Fax: +44 (0) 203 771 3856

German Social Security

In Germany nearly 90% of the population is covered for social security either on a compulsory or voluntary basis. If you are a resident and have registered at your local commune, then your tax return will automatically be processed and sent to you. Limosa was put in place to prevent employers employing unregistered workers.

At Chesterfield Management we will discuss the different options available in relation to umbrella company services, to maximize take home income, whilst remaining fully tax compliant.

People employed in Germany have to contribute to four principal social insurance schemes. The contribution is in general paid half by the employer and half by the employee.

Current social security rates in Germany are

• Rentenversicherung (Pension insurance): 19.6 percent
• Arbeitslosenversicherung (Unemployment insurance): 3.0 percent
• Krankenversicherung (Health insurance): 15.5 percent - 8.2 percent paid by the employee and 7.3 percent paid by the employer
• Pflegeversicherung (Nursing care insurance): 1.95 percent

There are other options including local and home country registration. If as a contractor, you are an EU resident, and you choose to remain within your home country social security system, it is sometimes possible to make regular voluntary payments, and obtain a form A1 (formerly called an E101) from your local social security office prior to taking up a position in Germany.

In theory this is quite straightforward, but the high level of regulation in Germany means that there are restrictions in place regarding recognition of qualifications which can prevent contractors from gaining this status.

At Chesterfield Management we can guide you through the agency compliance procedure and help you to reduce the social security burden substantially.

To learn more contact us on our office telephone number 0044 (0)2070971385, request a call-back, or click here to email us

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