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What you do get (speaking here from my experience in Belgium) is that the top of the wage scale is invisible because past a certain tier everyone works as a con
by Joeri 5y ago
What you do get (speaking here from my experience in Belgium) is that the top of the wage scale is invisible because past a certain tier everyone works as a consultant to avoid the high taxes. It is not unusual in senior tech roles to charge 1K+ per day or 20K+ per month, and pay a lower effective tax rate on that income, while having long term engagements with the same companies so that little time is lost to churn.
- codethief 5y ago> everyone works as a consultant to avoid the high taxes You mean, to avoid the social security fees (health/pension/unemployment/…)? After all, as a consultant (whether incorporated or not) you still need to pay taxes and the rates are pretty similar to tax rates for employees.
- Joeri 5y agoThe people that I know that are self-employed and earning high incomes generally are incorporated and have an accountant to set up tax avoidance strategies to have a lower effective tax rate. Effective tax rates seem to follow a gauss curve, low at the bottom, low at the top, highest for the middle earners.
- distances 5y agoThat'll vary by country and won't be efficient everywhere in Europe. Certainly in Germany freelancers pay the same taxes as regular employees, and setting up a company means more taxes, not less.