3 ms·

How to Leave Germany

34 points by nicbou 9mo ago

mechazawa 9mo ago
I don't understand the relevance
- kingkawn 9mo ago
  Do you currently live in Germany?
  - gostsamo 9mo ago
    I don't live in the US, yet US centric news are covered here on the regular. Hold your horses and don't interact with a post if you are not interested.
    - kingkawn 9mo ago
      So you don’t live in Germany. Explains why “How to leave Germany” is not relevant Also hilarious You telling anyone else not to interact with a post if it doesn’t relate to them.
- acatton 9mo ago
  The poster is the author of the website. So I think it's self-promo mixed with "hey, look how interesting is the amount of 'bureaucracy' involved when one wants to move out of Germany"
  - nicbou 9mo ago
    That's about right! It was meant to be a quick guide and it took me about a month to finish it because I kept coming across new issues. What got me to work on this was a related post on the German exit tax not too long ago: https://news.ycombinator.com/item?id=44828158 https://news.ycombinator.com/item?id=44828158 I don't gain anything from promoting my free, hyperlocal content here, but I love to talk about my work and the discussion here is unfailingly interesting.
    - readthenotes1 9mo ago
      I liked it, even though I have no intention of changing my domicile from Germany. The checklist somehow seems very German, including the advice that you don't have to turn in a resignation letter if you're fired. I know that sounds snarky, but the bureaucracy laid out is so vast it's actually warranted.
  - JKCalhoun 9mo ago
    Bureaucracy was my takeaway. As a USAmerican though, I see it as more general—a statement about how modern, "1st-world" civilization has become so god-damned complicated. I catch myself (especially since I have kids) realizing how difficult it is to navigate some aspect of modern life (for example, various payment methods—credit cards). A kind of mantra that always rises in my thoughts is, "No one would ever have designed the system to work like this." Somehow, independent actors, independent reasons, likely the ability to make it this complex has indeed made it this complex. It's no surprise then that just functioning in this modern society induces a level of background anxiety. Pretty much the opposite of "touching grass".
gcr 9mo ago
This is an excellent HOWTO for matters of public relevance. I wish there were guides with similar levels of detail for Americans. The closest thing I've seen is guides for changing your name in various USA states from the trans community; some of the processes are quite arduous (NJ for example has about 15 steps, most of which are manual separate errands with separate waiting periods...)
- nicbou 9mo ago
  I think that the government could do this job really well if they wanted to. I'm just one guy working ~25 hours per week, if that. It really isn't rocket science, just empathy and good writing. The biggest problem is that the government often describes bureaucracy in terms of what they need from you, not how their services fit in your journey. It feels like we are serving the bureaucracy and not the other way around.
naiv 9mo ago
The exit tax is absolutely insane and they even charge it within the EU. Say you own a company which has a profit of 10.000 Euros on average the past 3 years. Before you can leave Germany you will have to pay taxes based on 137.500 Euros.
- mpweiher 9mo ago
  "Freelancers and sole proprietors almost never pay an exit tax"
- nicbou 9mo ago
  I was glad to boil it down to "it probably doesn't concern you, and if it does, you probably have an expert on call already". The entire topic of taxation is a tarpit. One important note: this 13.75x valuation is a worse case scenario if you fail to supply your own. There are many ways to reduce or avoid this tax. It's awfully convenient that someone else went through it and started a website just for that topic. Funnily enough, his website was inspired by mine, and this guide was inspired by his post on exit taxation. It's a far better resource on the topic: https://wegzugsteuer.info/ https://wegzugsteuer.info/
  - naiv 9mo ago
    Thank you for the link. Very interesting!
  - olieidel 9mo ago
    Ha, that's my website - thanks for posting it (and for linking to it - allaboutberlin is awesome!). Indeed, the valuation for the purpose of exit tax is 13.75 * (avg. of yearly profits for the past 3 years); and that valuation is taxed at approximately 30%. So, as an example, if you own 100% of a company which makes 200k€ yearly profits, your back-of-the-envelope exit tax is 200k€ * 13.75 * 0.3 = 825k€. A few quick notes: - If your startup is not profitable but has raised VC money (we're on the YC website after all), the tax office likes to take the VC valuation (!) instead of the valuation resulting from the 13.75 multiple. So, if the valuation in your last round was €10M, then that's your valuation for the purpose of exit tax (back of the envelope: You own 50%, €10M valuation: 0.5 * €10M * 0.3 = €1.5M exit tax; huge problem for early-stage founders who usually don't have liquidity). - You can deduct a CEO salary from that (yearly) number if you haven't been paying yourself a salary yet - realistically, up to 150k€ / year. So if your profit is up to 150k€ / year, you can reduce it to near zero for the purpose of exit tax valuation. - You can also supply your own company valuation, but it has to be done by a "Wirtschaftsprüfer" - this costs around 10k€ per company; if you have shares >1% in multiple companies, this means costs of n * 10k€. This is often prohibitive. - There's a whole tax advisor industry around this exit tax topic, and it feels very shady. I've written up all my notes from (paid) tax advisor calls and shared them on my website for free (linked by in parent comment). - There are various setups to "avoid" it (all outlined on the website). None of those setups is easy, and none of them is free. Still, if you're e.g. faced with a potential exit tax of 825k€ like in the example above, any setup which might cost less than that might be theoretically worthwhile. - If you leave Germany and return within 11 years, you get the exit tax back - so if that's your plan, you could "just" take out a loan and it mainly becomes a liquidity problem. - Historically, there has been a strong tendency for Germany to tighten its exit tax laws over time. - Different people have (vastly) different opinions on how "good" or "fair" this tax is. - Discussing the exit tax has become quite a common topic among German founders nowadays.
koziserek 9mo ago
P.s. Don't try to use Deutsche Bahn to leave Germany, it will likely cause delays
- hagbard_c 9mo ago
  You'll get there in the end though, possibly with a free hotel stay. You'll also get half your ticket price back. All in all not that bad a deal for those who can spare the extra time it sometimes takes. Source: I use DB for longer international trips (Sweden-Netherlands and back) about 10-11 times per year.

34 points by nicbou 9mo ago

mechazawa 9mo ago

I don't understand the relevance

kingkawn 9mo ago
Do you currently live in Germany?
- gostsamo 9mo ago
  I don't live in the US, yet US centric news are covered here on the regular. Hold your horses and don't interact with a post if you are not interested.
  - kingkawn 9mo ago
    So you don’t live in Germany. Explains why “How to leave Germany” is not relevant Also hilarious You telling anyone else not to interact with a post if it doesn’t relate to them.
acatton 9mo ago
The poster is the author of the website. So I think it's self-promo mixed with "hey, look how interesting is the amount of 'bureaucracy' involved when one wants to move out of Germany"
- nicbou 9mo ago
  That's about right! It was meant to be a quick guide and it took me about a month to finish it because I kept coming across new issues. What got me to work on this was a related post on the German exit tax not too long ago: https://news.ycombinator.com/item?id=44828158 https://news.ycombinator.com/item?id=44828158 I don't gain anything from promoting my free, hyperlocal content here, but I love to talk about my work and the discussion here is unfailingly interesting.
  - readthenotes1 9mo ago
    I liked it, even though I have no intention of changing my domicile from Germany. The checklist somehow seems very German, including the advice that you don't have to turn in a resignation letter if you're fired. I know that sounds snarky, but the bureaucracy laid out is so vast it's actually warranted.
- JKCalhoun 9mo ago
  Bureaucracy was my takeaway. As a USAmerican though, I see it as more general—a statement about how modern, "1st-world" civilization has become so god-damned complicated. I catch myself (especially since I have kids) realizing how difficult it is to navigate some aspect of modern life (for example, various payment methods—credit cards). A kind of mantra that always rises in my thoughts is, "No one would ever have designed the system to work like this." Somehow, independent actors, independent reasons, likely the ability to make it this complex has indeed made it this complex. It's no surprise then that just functioning in this modern society induces a level of background anxiety. Pretty much the opposite of "touching grass".

gcr 9mo ago

This is an excellent HOWTO for matters of public relevance. I wish there were guides with similar levels of detail for Americans. The closest thing I've seen is guides for changing your name in various USA states from the trans community; some of the processes are quite arduous (NJ for example has about 15 steps, most of which are manual separate errands with separate waiting periods...)

nicbou 9mo ago
I think that the government could do this job really well if they wanted to. I'm just one guy working ~25 hours per week, if that. It really isn't rocket science, just empathy and good writing. The biggest problem is that the government often describes bureaucracy in terms of what they need from you, not how their services fit in your journey. It feels like we are serving the bureaucracy and not the other way around.

naiv 9mo ago

The exit tax is absolutely insane and they even charge it within the EU. Say you own a company which has a profit of 10.000 Euros on average the past 3 years. Before you can leave Germany you will have to pay taxes based on 137.500 Euros.

mpweiher 9mo ago
"Freelancers and sole proprietors almost never pay an exit tax"
nicbou 9mo ago
I was glad to boil it down to "it probably doesn't concern you, and if it does, you probably have an expert on call already". The entire topic of taxation is a tarpit. One important note: this 13.75x valuation is a worse case scenario if you fail to supply your own. There are many ways to reduce or avoid this tax. It's awfully convenient that someone else went through it and started a website just for that topic. Funnily enough, his website was inspired by mine, and this guide was inspired by his post on exit taxation. It's a far better resource on the topic: https://wegzugsteuer.info/ https://wegzugsteuer.info/
- naiv 9mo ago
  Thank you for the link. Very interesting!
- olieidel 9mo ago
  Ha, that's my website - thanks for posting it (and for linking to it - allaboutberlin is awesome!). Indeed, the valuation for the purpose of exit tax is 13.75 * (avg. of yearly profits for the past 3 years); and that valuation is taxed at approximately 30%. So, as an example, if you own 100% of a company which makes 200k€ yearly profits, your back-of-the-envelope exit tax is 200k€ * 13.75 * 0.3 = 825k€. A few quick notes: - If your startup is not profitable but has raised VC money (we're on the YC website after all), the tax office likes to take the VC valuation (!) instead of the valuation resulting from the 13.75 multiple. So, if the valuation in your last round was €10M, then that's your valuation for the purpose of exit tax (back of the envelope: You own 50%, €10M valuation: 0.5 * €10M * 0.3 = €1.5M exit tax; huge problem for early-stage founders who usually don't have liquidity). - You can deduct a CEO salary from that (yearly) number if you haven't been paying yourself a salary yet - realistically, up to 150k€ / year. So if your profit is up to 150k€ / year, you can reduce it to near zero for the purpose of exit tax valuation. - You can also supply your own company valuation, but it has to be done by a "Wirtschaftsprüfer" - this costs around 10k€ per company; if you have shares >1% in multiple companies, this means costs of n * 10k€. This is often prohibitive. - There's a whole tax advisor industry around this exit tax topic, and it feels very shady. I've written up all my notes from (paid) tax advisor calls and shared them on my website for free (linked by in parent comment). - There are various setups to "avoid" it (all outlined on the website). None of those setups is easy, and none of them is free. Still, if you're e.g. faced with a potential exit tax of 825k€ like in the example above, any setup which might cost less than that might be theoretically worthwhile. - If you leave Germany and return within 11 years, you get the exit tax back - so if that's your plan, you could "just" take out a loan and it mainly becomes a liquidity problem. - Historically, there has been a strong tendency for Germany to tighten its exit tax laws over time. - Different people have (vastly) different opinions on how "good" or "fair" this tax is. - Discussing the exit tax has become quite a common topic among German founders nowadays.

koziserek 9mo ago

P.s. Don't try to use Deutsche Bahn to leave Germany, it will likely cause delays

hagbard_c 9mo ago
You'll get there in the end though, possibly with a free hotel stay. You'll also get half your ticket price back. All in all not that bad a deal for those who can spare the extra time it sometimes takes. Source: I use DB for longer international trips (Sweden-Netherlands and back) about 10-11 times per year.