Less hassle. More certainty.
Maximized net payment.
German Umbrella Company helps contractors
and expats from all over the world.
Choose your situation
Our services in a nutshell
Helping contractors, consultants and expats in Germany. That’s what we do. We are your full-service payroll solution provider, or employer of record. The most important things we do for contractors and expats from all over the world are:
Why German Umbrella Company
The extra mile
It’s good to know that if we pay you via our payroll solutions, we pay out above market conditions and that you’re assigned a personal account manager for all round support and advice during your entire assignment. We’re a recognized BAP member, which means that our contracts follow branche agreed tariff regulations. And we’re also in possession of an indefinite (unlimited) AüG license since 2017, which ensures compliance with the German tax system for contractors and protection from any infringements of German tax law.
Services for international contractors
With our multilingual and multicultural team, we arrange everything you need in order to start working in Germany. Assistance with your EU Blue card? Check. Advice regarding requesting a German bank account? Of course. Everything you need is there for you, on-demand.
If you’re planning on moving to another country than Germany for an assignment, we can arrange that as well. We work together with a broad international network of recruitment and personnel agencies, so we always know who to call to get you in touch with the right company.
Frequently asked questions
about umbrella companies
Good question. An umbrella company is an entity that acts as your – the contractor that provides services directly to an end client – official employer. An umbrella solution offers contractors an alternative regarding setting up their own limited company and reduces the administrative tasks and risks that go along with that option.
Umbrella companies invoice your client or recruitment agency for work that you’ve completed, and process your payroll. This implies all necessary deductions, such as taxes, compulsory pension contributions and mandatory social insurances on your behalf, before paying out your net salary.
Also, umbrella companies can reimburse expenses, such as travel or accommodation costs, which benefits your net income.
Contractors need to submit their weekly or monthly timesheets to the umbrella company, that in it’s turn will raise an invoice towards the client or agency requesting payment for the hours a contractor worked. The contractor will get paid directly by the umbrella company -his employer, usually ahead of payments that the umbrella company is to receive from the client or agency.
Full payroll services
An umbrella company reduces a lot of administrative hassle and mandatory paperwork. Besides that, such a company processes your timesheets, bills your end client and pays out your net wages and reimbursable expenses. By using an umbrella company, your weekly administrative tasks should be less than 15 minutes.
Ensure compliance and reduce risk
The umbrella company will withhold payroll tax and all essential deductions regarding insurances and social contributions. By doing so, contractors can rely on the fact that all regulations and provisions are met and they do not need to fear fines or unpleasant surprises.
Statutory employee benefits
When working via an umbrella company, you technically become their employee. By such, you will be entitled to statutory employee benefits, just like a permanent employee. These benefits include a standard set of statutory payments like a statutory sick pay (SSP), statutory maternity pay (SMP) and holiday pay. Also benefits like clinical counseling, legal support, dependent care and critical incident support are part of the package that contractors who work via an umbrella company receive.
A compliant umbrella company provides you with three types of insurance which cover you during the assignments that you’ll work together.
- Employers’ liability insurance
- Public liability insurance
- Professional indemnity insurance
Working as a contractor through an umbrella construction implies employership. This entitles you to statutory employee benefits like a statutory sick pay (SSP), statutory maternity pay (SMP) and holiday pay. On the other hand, German legislation requires employers -German Umbrella Company in this case- to deduct and withhold mandatory employer social costs, employee social costs as well as direct taxation for the employee. Since all of these costs are mandatory and deducted, they should obviously be well taken into account when determining your monthly fee to the client.
Before you were a contractor, your client would’ve employed you directly as if you were part of his own personnel. He’d also pay your national insurance taxes. As a contractor, your client does not directly hire you, as the umbrella company functions as an intermediary. Thus, the German Umbrella Company is liable to pay your employment taxes and charges this amount as ’employer costs’ in the calculation. Therefore, those will be deducted from the invoice amount you charge to your client.