Working in Germany: the most frequently asked questions

Working in Germany: the most frequently ...

Are you currently working or planning on working in Germany? We have written down the most frequently asked questions related to arranging work in Germany.

These are the most frequently asked questions:

  • Do I need a work permit or residence permit?
  • What is the difference between a Steuer ID and a Steuernummer?
  • Do I have to get a German address?
  • What about social and health insurance?
  • How do I get my tax refund?

1. Do I need a work or residence permit?

You can work in Germany without a work permit if you are one of the EU member states's national. This rule doesn't apply to you if you aren't an EU member state citizen.

However, it is your responsibility to report your German address to the local authority within 14 days of arrival. If you are going to Germany for the first time, you will receive a tax identification number, the so-called Steuer ID (abbreviated in German IdNr), in return. It consists of 11 digits, the tax office uses it to identify you and it will stay with you forever. You also need it to apply for child benefits (Kindergeld). We wrote an article about child benefits on our blog.

2. What is the difference between a Steuer ID and a Steuernummer?

Do not confuse the Steuer ID with tax number, the so-called Steuernummer. The Steuernummer has 13 digits and was automatically assigned by the tax office (based on your address) after you filed your tax return. However, if you eventually moved to another city that fell under another office, you were given a new number (Steuernummer). Due to the fact that the Steuernummer could change frequently, its use has been abandoned and since 2008 the Steuer ID has been used.

3. Do I have to get a German address?

A German address is advantageous for you. One of the reasons is the already mentioned obtaining a Steuer ID. You also need it when creating a bank account or reporting to a health insurance company. Do not leave the search for accommodation to the last minute, as confirmation of accommodation at a hotel or through AirBnb will not be enough.

Tip: You can try a short-term rental, the so-called Wohnen auf Zeit, which you can register with the office until you find permanent housing.

4. What about social and health insurance?

Before you leave for Germany, do not forget to check out with your health insurance company, as you cannot be covered by health insurance in two countries at the same time. However, this does not apply to you if you are actively doing business in your home country and at the same time have an employment relationship in Germany.

Take the insurance contract with you to the insurance company in Germany and a certificate of termination of employment in Lithuania. You will give them your blue card (European Health Insurance Card). If you are self-employed, do not forget to unsubscribe from health and social insurance in your local country.

Private and public health insurance

The German health system is quite unique. There is a so-called dual system, which consists of public and private health insurance. Public health insurance is mandatory for every employee who can choose from more than 100 insurance companies. There are over 40 private insurance companies. However, only those who earn more than EUR 64,350 per year can be insured with them.

Social insurance

There is no need for administration around social insurance. The employer pays health and social insurance for you automatically.

5. How do I get a tax refund?

When you work in Germany, your employer will each month deduct a tax advance and pay it on your behalf to the local tax authority. At the end of the year, or when leaving the country, you will receive a document called “Lohnsteuerbescheinigung”, which is a document that summarizes your incomes, taxes, and other mandatory deductions such as social and medical insurance contributions.

For each year of work, you then file a tax return in Germany. Its advantages are clear - you might be able to refund part of your paid income tax back. Depending on your German income and your local or worldwide income, you can get a substantial amount of tax back.

TIP: If you have already worked in Germany get your refund estimation in our FREE online calculator and order other tax-related services online. You can get your tax refund 4 years back!

I want my taxes back.

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