Tax regulations change every year, e.g., tax rates are adjusted, and new regulations are made in the area of social security and immigration law or employment law.
The impact of the tax measures highlighted in this newsletter will depend on each taxpayer’s particular set of facts and circumstances. However, in most instances, we expect that an employee’s German tax burden will decline as a result of these changes, which should help employees to some extent with the rise in the current cost-of-living.
In the case of tax equalised/protected employees on assignment in Germany, these changes should reduce the cost of these assignments to the employer.
Given the impact of these changes to the operation of payroll/shadow payroll, they should be communicated to relevant stakeholders as soon as possible, to help ensure that payroll processes and software can be updated in a timely fashion.