PAYROLL SOLUTIONS

WW+KN PAYROLL SERVICES

WW+KN, a Baker Tilly company, offers comprehensive payroll solutions designed to meet the needs of foreign businesses and multinational corporations with employees in Germany. Our services ensure compliance, efficiency, and accuracy in payroll management, making it easier for international companies to navigate the complexities of German payroll regulations.

Our Payroll Services Include:

1. Payroll Processing:

  • Monthly payroll calculations and processing
  • Maintenance of employee master data
  • Creation and management of payroll accounts
  • Annual payroll reconciliations and tax certifications
  • Electronic submission of data to tax authorities and health insurance providers
  • Calculation of fringe benefits, non-cash benefits, and capital-forming benefits
  • Adherence to industry-specific regulations
  • Reporting to professional associations
  • Implementation of legal changes promptly

2. Social Security Contributions:

  • Registration and management of contributions to health, pension, unemployment, and long-term care insurance
  • Handling of contributions for part-time and full-time employees

3. Accident Insurance:

  • Registration with relevant trade associations for accident insurance

4. Immediate Reporting:

  • Compliance with immediate reporting requirements for specific industries (e.g., construction, hospitality, transport)

5. Additional Services:

  • Travel expense accounting
  • Occupational and statutory pension schemes
  • Integrated reporting to social insurance carriers and health insurers

Advantages of Our Payroll Solutions:

  • Expertise and Compliance: Our team of qualified professionals ensures compliance with the latest tax, finance, and social security regulations, reducing the risk of errors and penalties.
  • Cost Efficiency: Outsourcing payroll to us helps manage costs effectively, providing predictable expenses and avoiding costly payroll mistakes.
  • Flexibility: Our services are adaptable to your business needs, preventing personnel shortages during holidays and ensuring uninterrupted payroll processing.
  • Data Security and Precision: We use DATEV eG, the leading payroll software in Germany, ensuring secure and precise payroll processing.
  • Bilingual Reporting: We provide payroll reports in both German and English, catering to the needs of international companies.
  • Electronic Data Interfaces: Our electronic data interfaces allow seamless integration with your existing systems, ensuring efficient data exchange.
  • Legal Support: As a member of Baker Tilly, we have access to experienced employment lawyers who can assist with drafting employment contracts, handling terminations, managing labor court proceedings, and providing legal clarifications and registrations.

Why Choose Us?

  • In-Depth Knowledge: We navigate the complex landscape of payroll regulations and stay updated with new laws to ensure your compliance.
  • Efficient Processes: Our workflows are automated and straightforward, allowing us to manage payroll independently and digitally.
  • Time and Cost Savings: By outsourcing your payroll to us, you can focus on your core business activities and strategic planning while we handle the administrative burdens.
  • Stress-Free Compliance: We support you during routine audits and inspections, ensuring that you can approach them with confidence and ease.

If you are interested in collaborating with us or have further questions, please feel free to send us an email at info@payrollgermany.de 

WW+KN PAYSLIP SAMPLE

WW+KN utilizes DATEV eG software, the leading provider of accounting solutions in Germany, for preparing payroll and salary statements. Below is a sample salary statement. This document is available bilingually in German and English:

 

Minimum Information: Employee details include essential tax and social security information, start/leaving dates, and a processing flag for identification.

Processing Flag (VKZ): The processing flag, printed at the top right corner, allows definite identification. Employees must include recalculations with an identical flag along with the main pay advice of the relevant month.

Employer and Employee Details: Names and addresses of both employer and employee are mandatory and must be included.

Payments: Descriptions in wage codes, tax fields, social security, total gross income, and payment amounts must not be blackened.

Tax/Social Security: Values in the tax/social security fields must not be blackened to ensure transparency of deductions.

Non-taxable Payments and Net Pay: Non-taxable payments and deductions must remain visible to make the net pay comprehensible.

List of Abbreviations: A list of abbreviations is included in the footer of the pay advice for clarity.

Employee Data: Includes personal details such as personnel number, date of birth, religion, health insurance details, tax allowances, and tax class. The social security number, premium group code, HR group code, and employer’s compensation are also listed.

 

PAYROLL COMPLIANCE IN GERMANY

WW+KN, a Baker Tilly company since January 1, 2024, offers comprehensive payroll compliance services tailored to international companies with employees, subsidiaries, or permanent establishments in Germany. With our deep expertise and commitment to excellence, we ensure your business meets all regulatory requirements efficiently and effectively.

Understanding Payroll Compliance in Germany

Germany’s payroll system is known for its complexity, involving multiple layers of taxes, social security contributions, and strict regulatory compliance. Key components of payroll compliance in Germany include:

  • Employee Registration:
    All employees must be registered with the relevant social security and tax authorities.
    Employers need to ensure proper documentation, including health insurance membership and tax identification numbers.
  • Monthly Payroll Processing:
    Payroll must be processed monthly, with detailed payslips provided to employees, detailing gross and net pay, tax deductions, and social security contributions.
    Employers must use approved software, like DATEV eG, to ensure accuracy and compliance.
  • Income Tax and Social Security:
    Income tax in Germany is progressive, ranging from 14% to 45%, depending on the income bracket.
    Social security contributions cover health insurance, pensions, unemployment insurance, and long-term care, with both employer and employee contributing approximately 20-22% of the gross salary.
  • Compliance with Employment Laws:
    Employers must adhere to laws governing working hours, minimum wage, and leave entitlements.
    Regular updates and compliance with new regulations, such as changes to the minimum wage and employment contracts, are mandatory.
  • Reporting and Filings:
    Employers must file regular reports with tax authorities (Finanzamt) and social insurance institutions.

Key filings include the Lohnsteuerbescheinigung (certificate of wages) and reports to Berufsgenossenschaften (statutory accident insurance providers).

WW+KN’s Role as a Compliance Partner

As part of Baker Tilly Germany, WW+KN leverages a global network of partners in 145 countries, offering unparalleled expertise and support. Our services include:

  • Payroll Processing: Comprehensive monthly payroll services, ensuring timely and accurate payment of wages and compliance with all legal requirements.
  • Tax Compliance: Assistance with income tax calculations, filings, and liaison with tax authorities to ensure accurate reporting.
  • Social Security Management: Handling all aspects of social security contributions, including registration, calculations, and payments.
  • Regulatory Updates: Keeping your business informed and compliant with the latest changes in German employment and payroll laws.
  • Legal Support: Access to Baker Tilly’s experienced employment lawyers for drafting employment contracts, managing terminations, and handling labor disputes.
  • Memberships and Global Reach

WW+KN’s memberships with the German-Italian Chamber of Commerce and the German-Slovenian Chamber of Commerce enhance our ability to support businesses from these regions operating in Germany. Our affiliation with Baker Tilly provides access to a network of experts in 145 countries, enabling us to offer global payroll solutions.

For more information on how WW+KN can assist with your payroll compliance needs in Germany, please feel free to send us an email at info@payrollgermany.de 

SPECIAL PAYROLL CASES

When Payroll Becomes Challenging: WW+KN is Your Trusted Partner

Managing payroll in Germany can be particularly challenging, especially when issues arise with international payroll providers. At WW+KN, a Baker Tilly company, we have extensive experience in resolving complex payroll issues and ensuring compliance with German regulations.

Here are some common scenarios where our expertise can make a significant difference:

  1. Issues with Global Payroll Providers:
    • Many international companies initially engage seemingly cost-effective global payroll providers. However, problems often emerge when these providers rely on freelancers who are overwhelmed by the intricacies of German payroll.
    • We frequently encounter cases where these providers lack the necessary expertise, leading to errors and employee dissatisfaction.
  1. Inexperienced Local Service Providers:
    • Engaging a local tax advisor unfamiliar with the needs of international firms can result in inadequate payroll management. These advisors may struggle with the complexities of cross-border employment laws and payroll regulations.
    • Our team at WW+KN is well-versed in handling the unique requirements of multinational corporations operating in Germany.
  1. Payroll Errors and Employee Complaints:
    • Payroll errors can lead to significant issues, including employee complaints and potential legal repercussions.
    • We provide thorough audits and corrections to ensure all payroll processes are accurate and compliant.
  1. Inadequate Response Times and Lack of Consultation:
    • Some service providers merely process payroll without offering the necessary consultation and support. This can be problematic when quick, informed decisions are required.
    • WW+KN offers responsive and consultative services, ensuring that you receive the guidance needed to navigate payroll challenges effectively.
  1. Retroactive Payroll Requirements:
    • When a permanent establishment is retrospectively determined, or employees exceed the 183-day threshold, retroactive payroll processing becomes necessary.
    • We specialize in handling such cases, ensuring that all backdated payrolls are correctly processed and compliant.
  1. Tax and Social Security Obligations:
    • If the German tax authorities or social security institutions retroactively determine tax or social security liabilities, extensive correspondence and possibly legal proceedings may be required.
    • With access to Baker Tilly’s legal experts, we manage all necessary communications and represent you in any disputes or corrections.
  1. Audit Findings and High Back Payments:
    • Audits by tax or social security authorities may result in findings that require substantial back payments.
    • Our team can review these findings and provide a second opinion or assist in restructuring employment relationships to mitigate such liabilities.
  1. Compliance Reviews and Second Opinions:
    • We offer reviews and second opinions on your German payroll to ensure everything is in order and compliant with current regulations.
    • This is especially useful for businesses looking to restructure their employment practices or verify the accuracy of their payroll processes.
  1. Employer Company Service Issues:
    • Sometimes, companies use employer services permissible in other countries but find out later that they need authorization under the German Employee Leasing Act (Arbeitnehmerüberlassungsgesetz).
    • We can assist in navigating these challenges and resolving any potential penalties with the support of Baker Tilly’s tax advisors and legal experts.
  1. Employees of Service Providers on NATO Installations:
    • We assist with payroll for employees of service providers working on NATO installations in Germany under the SOFA Agreement. This includes employees from the USA, Canada, or Australia working for the US Army or Air Force in Germany, particularly with the necessary TOT certificates.

At WW+KN, we leverage our extensive experience, comprehensive understanding of German payroll regulations, and access to a global network through Baker Tilly to provide reliable solutions for even the most challenging payroll issues.

For more information or to discuss how we can assist with your payroll needs, please feel free to send us an email at info@payrollgermany.de 

PAYROLL UNDER NATO / SOFA AGREEMENT

Managing payroll for service providers working with NATO forces in Germany, particularly those from countries like the U.S., Canada, and the United Kingdom, requires specialized knowledge and expertise. At WW+KN, a Baker Tilly company, we offer tailored payroll solutions to ensure compliance with German regulations and the specific requirements of the NATO Status of Forces Agreement (SOFA). Here’s how we support service providers in this unique context:

Understanding SOFA and Its Implications

The NATO SOFA, signed in 1951, provides the legal framework for the status of military personnel, civilian employees, and their dependents stationed in Germany. This agreement includes provisions that affect taxation, employment, and legal compliance for service providers supporting NATO forces.

Key Services Provided by WW+KN:

  1. Comprehensive Payroll Management:
    We manage the entire payroll process, ensuring accurate calculations for wages, taxes, and social security contributions. Our services include preparing bilingual pay slips and detailed payroll reports to meet the needs of both employers and employees.

  2. Tax and Social Security Compliance:
    Ensuring compliance with German tax and social security regulations is critical. We handle the registration and calculation of mandatory contributions, helping service providers from NATO countries navigate the complexities of German payroll taxes.

  3. Specialized Support for SOFA Employees:
    For employees of service providers working under the SOFA agreement, we assist with obtaining and managing necessary certificates and documentation. This ensures compliance with residency and employment regulations in Germany.

  4. Addressing Complex Payroll Issues:
    We have extensive experience in resolving issues arising from the use of global payroll providers who may lack local expertise. This includes handling errors, managing employee complaints, and ensuring timely and accurate payroll processing.

  5. Retroactive Payroll Adjustments:
    If a permanent establishment is determined retroactively or employees exceed the 183-day threshold, we specialize in making the necessary retroactive payroll adjustments to ensure compliance.

  6. Legal and Regulatory Support:
    With access to Baker Tilly’s network of legal experts, we provide comprehensive support for employment and immigration matters, including drafting employment contracts, managing terminations, and handling labor disputes.

  7. Audit and Review Services:
    We offer thorough audits and second opinions on existing payroll processes to identify and correct any compliance issues. This is particularly useful for service providers looking to restructure their payroll operations or verify the accuracy of their payroll systems.

  8. Assistance with NATO Installations:
    We provide payroll services for employees of service providers on NATO installations in Germany, including those working for the U.S. Army or Air Force, as well as other NATO countries. This includes managing the necessary TOT certificates and ensuring compliance with all relevant regulations.

  9. Resolution of Employment and Immigration Issues:
    Our team handles all necessary correspondence with German authorities and provides representation in any disputes or legal proceedings related to payroll and employment compliance.

  10. Support for EOR Services:
    For companies using Employer of Record (EOR) services, we ensure compliance with the German Employee Leasing Act (AÜG) and handle all necessary registrations and legal requirements with our lawyers form Baker Tilly Germany.

WW+KN, as part of the Baker Tilly network, brings extensive experience and a robust infrastructure to support service providers working with NATO forces in Germany. Our specialized payroll services ensure compliance, efficiency, and peace of mind for businesses navigating the complexities of the SOFA agreement and German payroll regulations.

For more information or to discuss how we can assist with your payroll needs in Germany, please feel free to send us an email at info@payrollgermany.de