Tax Forum :: Free Tax Advice

Hi there,

I am an British citizen living in Germany - employed by a German company - as PAYE

I also have another source of income which up until now has been insignificant but is rapidly becoming more apparent so i need to try and find a solution in order to make it official and start paying tax on it.

My field of employment in Germany is with TV and advertising.
The 'occupation' that is becoming something that i need to acknowledge officially is based much more in the UK and involves painting and gallery exhibitions - the two different fields are not connected.

Is the obvious approach to this to register a company in England and do all my invoicing for the gallery work through that - completely separate to my occupation in Germany? - or by tax law do they have to both be connected?

if they are connected - do i have to declare the income from my UK profession in Germany or do i still do it separately in the UK?

..or does it just make more sense to register a company in Germany and do the gallery invoicing through that? - if so - is it actually legal to work as PAYE in Germany and also have a private self employment company at the same time?

thanks for any advice!

Certainly in the UK there's nothing that means that they "need to be connected". However, the international taxation arrangements are not as simple as you think.

If you are non-resident in the UK then only income arising in the UK is assessable here. In Germany it is likely that you will have to declare your worldwide income and claim double taxation relief in respect of UK taxes paid against German taxes charged in accordance with the Double Taxation Treaty.

However, a limited company is a separate legal entity from you, and has its' own obligations. Regardless of whether the company is incorporated in the UK, its' residence remains in question. If you are the sole director and resident in Germany, then the company is also likely to be resident in Germany.

You really need to sit down and talk it through with advisors, both in Germany and in the UK before your do anything.