Tax System in Germany
Understanding the tax system is vital when moving to a new country. Below is an account of Germany’s income tax system accurate as of 2019. This account was taken straight from our “Berlin Relocation Guide” which can be downloaded here: https://www.sigmarrecruitment.eu/relocating-to-germany/berlin
If you are a resident of Germany, you have full income tax liability. All income earned in Germany and abroad is subject to German income tax and a solidarity surcharge. Germany’s income tax system is progressive, meaning that the rate of tax increases as income increases ranging from 0–45%. For married couples, rates are more favorable when tax is filed jointly. The tax year runs from January 1st to December 31st. If you do have to file your own taxes, the cutoff date is May 31st for the preceding year.
The rates for 2019 are;
- 0 – 9,169 0%
- 9,169 - 14,255 14-24%
- 14-256 - 55,960 24-42%
- 55,691 – 265,236 42%
- 265,327+ 45%
The solidarity surcharge (Solidaritaetszuschlag) is an additional fee on income tax, capital gains tax and corporate tax in Germany. This means that the solidarity surcharge is to be paid by every natural and legal person that owes one of the above-mentioned taxes in Germany. This surcharge is levied at 5.5% of the income tax for higher incomes.
Withholding/Pay as you Earn Tax
Income from employed work and capital income are taxed at the source, meaning you as a tax payer will not need to file your own taxes come year end. The tax owed will be deducted and retained at the source by the employer or by the bank before the earnings are payed out. If the employer is a German company or a foreign enterprise with a permanent establishment or a representative in Germany, the employer is legally obliged to withhold taxes from an employee’s salary and to remit the taxes to the tax office monthly.
Paying Income Tax
When you are taxed at the source, your tax will be based on your personal status. You will fall into a certain class that will directly affect how much tax you pay. Below are the six types of tax classes:
Class 1: Single
Class 2: Single parent (living alone with the child/children)
Class 3: Married and spouse (when spouse does not have an income)
Class 4: Married and similar income to spouse
Class 5: Opposite of class 3, i.e this is the class the second earner chooses if the spouse opts for class 3
Class 6: For a second job or for deduction without proper employee information
The taxation at source for capital income will be done with a flat tax rate of 25% (add solidarity surcharge of 5.5% of the amount of tax).
Posted by Adam Dunne on 29 April 2019
Frankfurt's Start-up Scene
Frankfurt's Start-up Scene
Frankfurt is emerging as a vibrant European start-up ecosystem supported by its esteemed legacy and finance industries. The city boasts a highly diverse and active network of businesses that are boosted by the region’s exceptional research and education centres. Frankfurt is the finance capital of Europe, dubbed ‘Mainhattan’, the city is home to the European Central Bank, ECB Banking Supervision – SSM, the European Insurance Oversight, the German Stock Exchange (the 10th largest in the world), Bundesbank, the German financial oversight body Bafin, Deutsche Bank, Commerzbank and many more. The finance industry employs over 70,000 people and generates revenues higher than many countries worldwide. The city is also home to a multitude of large corporations such as Schott, Opel, Frankfurt Airport, Merck KGaA, Sanofi, and Deutsche Flugsicherung. This incredible wealth and knowledge within the city have laid the foundations for a thriving technology and start-up scene. Frankfurt’s corporate outfits offer significant benefits to start-ups in the region. Frankfurt has one of the highest concentrations of finance specialists and coders with experience in finance and tax in Europe offering much needed operational support to start-ups. Furthermore, many of Frankfurt’s large corporations have launched some incredible initiatives to position their business at the forefront of technology and start-up activity. Deutsche Bank launched its Digitalfabrik or digital factory, a project for programmers and finance experts to develop digital banking projects; Commerzbank’s initiative CommerzVentures is investing in “the most ambitious young” start-ups; and Deutsche Borse unveiled its Fintech Hub in 2016, an initiative aimed at supporting the fintech community in Frankfurt and in the Rhein/Main region. One of the newest programs to arrive in the city is the iconic Silicon Valley accelerator program Plug and Play, which launched a new European fintech program in collaboration with TechQuatier earlier this year. TechQuatier is an international community, incubator and co-working place comprised of over 100 start-ups and 30 academic partners and academic institutions. Corporate R&D spending totalled a whopping €5.5 billion in 2017. Naturally, Frankfurt is a hub for the FinTech industry with 55% of all local VC investments being acquired by fintech start-ups from 2012-2017. The acquisition of Fintech 360, a trading network for foreign currencies, was the largest start-up exit in German history coming in around €725 million. Interestingly, it was the Frankfurt Stock Exchange that acquired Fintech 360. However, Frankfurt has a lot more to offer than just fintech and finance. The city has a high concentration of AI, Big Data & Analytics start-ups with 8.5% of all start-ups in the region engaging in one of the three innovative activities. These start-ups acquired just over 13% of all local VC capital between 2012-2017. AI start-up Arago recently received €55 million in venture capital funding. These innovative start-ups are boosted by the fact that Frankfurt has the largest internet exchange point in the world, the DE-CIX. Furthermore, there is an abundance of large co-working spaces dotted around the city, twenty-two recognised spaces as of 2018. There is also numerous incubators and accelerators that offer vital support to start-up such as; Main Incubator, Pando Ventures, Unibator, Grundermaschine, Commerzbank Content Shift, Accelerator Frankfurt, E&Y Start-up Academy, Merck Accelerator and UX Accelerator. Lastly, Frankfurt’s high density of research and education institutes provide the talent needed to grow these start-ups into highly successful businesses. 25+ institutions educating over 230,000 students are present in the city and some are infamous for their innovation. Research intense institutions like the University of Mainz are where instruments for Mars Exploration Rovers Spirit and Opportunity were built. At this current time, Frankfurt pales in comparison to other European cities in terms of start-up activity. On the other hand, Frankfurt’s start-up activity is estimated to be growing 50% year on year and with the wealth and knowledge in the city, the future is bright.
Renting Accommodation in Stockholm
Renting Accommodation in Stockholm
Sourcing suitable accommodation is always at the top of your priority list when relocating to a new city. Finding accommodation in Stockholm is no easy task but if you are flexible with your price and location, it is manageable. We recommend finding an apartment to rent for one to three months when you initially move to Stockholm. There are significantly more properties on the market for short-term leases as landlords and tenants may be travelling or working abroad for short periods. During this time, you will the chance to get to know the city giving you a clearer idea of where you will want to live. In addition, you will have time to ask locals or colleagues advice on where to live, how to find an apartment and all the processes that are involved with renting in the city. It is quite difficult to get a long-term apartment to rent in the city like other European cities. In Stockholm, it is the norm to be offered a 6-month lease with a possibility of a 6-month extension. It is possible to get a 1-year contract, but it’s extremely rare that you will find something longer than that. In most cases, if you are looking for a contract that extends over one year, the landlord will have to ask permission from the board of directors of the building. Rentals: There are two types of rentals in Sweden, Fist-hand and Second-hand. First-hand rentals A first-hand Förstahand contract, means that the apartment is in your name and you deal directly with the landlord. This usually requires several years in the housing queue. The housing queue gives people access to rental apartments with capped prices. To join this, you must register with the Stockholm Housing Agency. Second-hand rentals Second-hand rentals are most common in Stockholm. A second-hand Andrahand contract is a sublet. This is where someone that owns their apartment or has a first-hand contract, rents their apartment to someone else. This comes at a cost and the competition is high. These can often have a 1-3 month notice period if the tenant/landlord want to move out/in. It is extremely important to make sure that the tenant is co-operating with the board of the building bostadsrättsföreningen or that the landlord has signed off on second-hand leasing. If you sublet a flat from someone who doesn’t have permission, you could run the risk of being evicted. Where to Live Due to the high levels of competition within the city for housing, it is not only hard to find an apartment, but it can be expensive too. Thankfully, Stockholm operates a very efficient and affordable public transport system that enable you to live outside of the city without facing an arduous commute to work every day. Areas outside of the city such as Sollentuna are only 20 minutes commute by tram and offer more affordable housing. We recommend you look outside of the city centre to boost your chances of finding suitable accommodation. Prices As mentioned earlier, Stockholm city centre is very expensive to rent in with areas on the outskirts of the city offering a more affordable option. Below is a breakdown of monthly rent costa for areas within Stockhom in SEK. Green = Average Price Light Grey = One Bedroom Grey = Two Bedroom Dark Grey = Three Rooms Photo Credit: RelocatetoSweden.com Where to Look There are several housing websites where you can find suitable accommodation; Blocket – blocket.se Bostad Direkt - bostaddirekt.com Qasa Residensportalen Andrahand.se BoPunkten.se There are a number of Facebook groups where you can find shared accommodation; https://www.facebook.com/groups/223360214358564/ https://www.facebook.com/groups/146281422217393/ https://www.facebook.com/groups/139276769508646/ Looking for a job that will enable you to pay rent in Stockholm? See our full list of vacancies here.
Demand for PHP Developers
Demand for PHP Developers
PHP is a staple language in the software development world first appearing on the tech scene way back in 1994. In recent times, we have seen a flurry of articles surface on the future of PHP with some critics arguing that it is a language of the past and that there is no future for PHP professionals on the market. We thought it would be a good idea to present our own take on the polarizing topic. Today’s technology market is evolving at an unprecedented pace, and many critics fear that the times of PHP are long gone. This begs the question; is it worthwhile investing in PHP and creating PHP resources, or are they doomed to become obsolete in the near future? Though many new languages and frameworks are quickly gaining momentum, PHP remains in the top 10 programming languages worldwide according to GitHub, TIOBE, Hacker and Fullstackacademy rankings. PHP was ranked fourth in GitHub’s rankings in 2015, 2016, 2017 and 2018. PHP was given the seventh-place ranking in 2018 and eighth place in 2019 by TIOBE experts. Hacker.io listed it as number eight programming language to learn and Fullstackacademy.com listed is as number six programming language to learn in 2019. Not so bad for a ‘dead language’. The demand for PHP from a business perspective offers an insight into the longevity and future of the language. PHP is a highly versatile language that can be used for a plethora of business applications from website applications to CRM systems to content management systems. PHP is perfectly compatible with a variety of Apache, IIS and MySQL interfaces and it offers a high level of control to the web developer. PHP boasts a high level of reliability and performance coupled with relatively low development and maintenance costs. This versatile nature and variety of benefits offered by PHP means that it appeals to both start-ups and established businesses who in turn then seek to hire experienced PHP professionals. PHP is used by major brands such as Yahoo, Facebook, Wikipedia, Flickr, WordPress, Friendster, Digg, Source Forge, iStockPhoto, and MailChimp as well as being used by approximately 79% of all websites (discounting CMS sites). Short answer, there is a lot of demand for PHP developers. In the current state of affairs, there is high demand for IT professionals across the entire IT spectrum with demand often outstripping supply. Companies are battling for talent leading to a surge in salaries and remuneration packages being offered to IT professionals. This however is not the case for PHP professionals. Approximately 20% of all developers within the EU have PHP in their tech stack according to LinkedIn data. This figure is so high as PHP is a comparably simple language to learn, and practitioners are often self-taught. It can be learnt for free, has a huge community, and is open source. This substantial number of PHP developers has led to lower salaries being offered compared to other IT professionals such as Ruby on Rails developers with salaries dropping by approximately 4% from 2017 to 2018. Despite the surplus of PHP developers on the market, there is always room to optimise and futureproof your skillset to get ahead of the curve. Lavarel and Symphony are sought after frameworks on a CV with only 12% and 10% of PHP professionals listing them as a core skill. Recently, we have seen a lot of demand in the market for CMS skills like TYPO3, Drupal and Magneto. There is a clear shortage of suitable candidates on the market with these skills to match the ever-growing demand. Adding these frameworks to your tech stack will make you a highly sought-after candidate and also enable you to command a higher salary. What is most important to perfect within PHP is the same as every other language, your code. Clean, effective code is a priceless commodity, one that will enable you to command a higher salary more than anything else. The future is yet to be written on PHP, current reports do signify a minute decrease in the demand for PHP, however there is no cause for panic just yet. PHP is an incredibly well established language utilised by millions for a variety of applications across the world. Looking for a PHP job? Check out our current vacancies here.
Swedish Residence Permit
Swedish Residence Permit
If you are an EU citizen and plan to stay in Sweden for more than three months you will need a to have the right of residence. This means you must have means to support yourself. You do not need a residence permit and you do not need to contact the Swedish Migration Agency. After living in Sweden for five years with the right of residence you will be granted permanent right of residence. With your permanent residence card, you will be eligible to apply for citizenship. Both EU and non-EU citizens must obtain a Personnummer number if they are living in Sweden for more than three months, this is an identification number that is given to all Swedes. It is obtained after you register in the Swedish population register. This can be obtained at a Skatteverket Office (Swedish Tax Agency). You will be required to have a Swedish address to register, as your Personnummer must be sent to your own Swedish address. You will not be able to open a bank account until you have received your Personnummer. This application is relatively straightforward for EU citizens. If you are a non-EU citizen, you will need a work permit to enter Sweden. An application for a work permit of three months or more is automatically issued with a residence permit application. Citizens of Nordic Countries Citizens of Denmark, Finland, Norway and Iceland may live in Sweden without obtaining a residence permit. All you must do is register with the Swedish Tax Agency to obtain your personnummer number. Required Documents You will need to bring the following documents; Passport or national ID card Documents showing your civil status Birth certificate, if you have children Proof of employment in Sweden 'anstallningbevis' A payslip if you have already started working This must be provided from your employer confirming that you will be working in Sweden. The employment certificate must be signed by your employer and you and must include the following; your name and your address your employer's name and address your employer's corporate identity number - organisationsnummer if you are employed on a fixed-term or indefinite-term basis or on a probationary or temporary basis other employment terms including employment date, period of notice, working hours, holiday leave, salary and benefits description of your duties collective agreement (if applicable) Change of Address If at any time you move to a new address, you must report your new address to the Swedish Tax Agency. It is free of charge to report and can easily be done with the use of the Tax Agency’s e-service. On the e-service you can print out the form and send it to them by mail. Where do I register? In the below link you can locate your nearest Swedish tax agency location; https://skatteverket.se/omoss/kontaktaoss/besokservicekontor.4.515a6be615c637b9aa4acd5.html Leaving Sweden If at any point you decide to leave Sweden again you must notify the Swedish Tax Agency of your plans. If you move to another Nordic country the regulations of that country will determine if you will enter its population register. You will be removed from the Swedish population register after the Nordic country has registered you with their population register.