taxation
September 1, 2011 | 30,00 EUR | answered by Oliver Burchardt
I am married and my husband (Spanish) lives and works in the UK. I (German) moved with our 2 daughters from the UK to Germany last year so they can learn about my country, language, and school.
We are currently registered with the UK authorities as dependents of my husband in Germany and therefore insured through a German health insurance via the UK. We do not receive child benefits, etc., and I do not work.
My question is, if I start working in Germany, what tax class will I be classified into? Would my husband also be liable for taxes in Germany, since we are married? The dependent status of my husband in the UK would no longer be valid, and I would be obligated to have health insurance in Germany?
Dear questioner,
Thank you for your inquiry, which I will be happy to answer as part of an initial consultation.
Please note that the tax assessment is based on the information provided. Changing, adding, or omitting information can affect the tax assessment, possibly significantly.
If you start employment in Germany, you will be classified in tax class I. The application of the splitting tax rate is not possible in your case, as your husband does not have at least 90% of his income taxed in Germany. Therefore, classification in tax classes III or V is not possible.
Your husband does not become liable to tax in Germany simply because you are married. Although the principle in the double taxation agreement Germany - United Kingdom states that spouses are resident where their common place of residence is, both you and your husband could be residents in either Germany or the United Kingdom and be liable to tax in the respective country. It depends on the specific circumstances.
However, in your case, this question is more of an academic nature. Article 14 of the double taxation agreement states that income from employment can only be taxed in the country of residence if it is not earned in the territory of the other country. Specifically:
If your husband is considered a resident in Germany according to the provisions of the double taxation agreement, he would have to pay tax on his income here. But assuming he is employed in the UK (and therefore working in the "other contracting state" from a German perspective), the right to tax lies in the UK and not in Germany. Similarly, if you are considered a resident in the UK and work in Germany, only Germany has the right to tax your employment income.
If you have additional income aside from employment income (e.g., from capital assets), the question of residency would need to be clarified again.
By taking up socially insured employment in Germany, you will also be subject to unlimited social security contributions here. The status as a dependent is therefore irrelevant.
Determining whether the status falls under British social security law is beyond my advisory authority, as it involves a legal assessment that is not just a side effect of tax advice.
I hope this information has been helpful to you during your inquiry.
Best regards,
Oliver Burchardt
Tax advisor
