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I've participated in similar setups before. Everyone was self-employed, working as a contractor, invoicing the German company. As we were all in the EU, this wa

by tasuki 8y ago

I've participated in similar setups before. Everyone was self-employed, working as a contractor, invoicing the German company. As we were all in the EU, this was pretty smooth. Why would you need to start a mailbox firm in every country with employees?

ubersoldat2k7 8y ago
This is the easiest route. Every country has its own tax and SS laws that would be impossible to handle from a central location. Easier to pay a bit more so each contractor is able to fully pay all of these too (accountant fees included). Which is also important to take into account when negotiating salaries because 50k on Munich is not the same as on Ibiza.
slgeorge 8y ago
There are two problems, employment taxes/benefits and employment rights. Lets say you have a German company and you have people working across Europe. For the sake of argument lets say that you have 15 people in France. Let say that all the people work for you 100% of the time, so they are effectively employees. On the employment taxes/benefits front how are you paying the French state those 14 peoples payroll tax, and how are you paying in for their state pension? Pragmatically, you can't do this (AFAIK) without establishing a company in the jurisdiction and registering them as employees. On the employment rights front, which jurisdictions are you following? As you have 15 people in France they are due to have a workers representative, does that fall under the French or the German system? If you have an issue with one of the team do you follow French or German employment law? Again, pragmatically each jurisdiction assumes that you fall under their employment laws and logically they'll assume you have a company in that geo.
- tasuki 8y ago
  The 15 people in France are self-employed. They pay their own taxes to the French state, they pay their own social and health insurance. It's very simple. Wrt jurisdiction, usually the employer's jurisdiction. You don't follow "employment law", you follow "international business" law or some such, because that's what it is.

by tasuki 8y ago

ubersoldat2k7 8y ago

This is the easiest route. Every country has its own tax and SS laws that would be impossible to handle from a central location. Easier to pay a bit more so each contractor is able to fully pay all of these too (accountant fees included). Which is also important to take into account when negotiating salaries because 50k on Munich is not the same as on Ibiza.

slgeorge 8y ago

There are two problems, employment taxes/benefits and employment rights. Lets say you have a German company and you have people working across Europe. For the sake of argument lets say that you have 15 people in France. Let say that all the people work for you 100% of the time, so they are effectively employees. On the employment taxes/benefits front how are you paying the French state those 14 peoples payroll tax, and how are you paying in for their state pension? Pragmatically, you can't do this (AFAIK) without establishing a company in the jurisdiction and registering them as employees. On the employment rights front, which jurisdictions are you following? As you have 15 people in France they are due to have a workers representative, does that fall under the French or the German system? If you have an issue with one of the team do you follow French or German employment law? Again, pragmatically each jurisdiction assumes that you fall under their employment laws and logically they'll assume you have a company in that geo.

tasuki 8y ago
The 15 people in France are self-employed. They pay their own taxes to the French state, they pay their own social and health insurance. It's very simple. Wrt jurisdiction, usually the employer's jurisdiction. You don't follow "employment law", you follow "international business" law or some such, because that's what it is.