Are you carrying out construction or assembly work in Germany? Czech companies may have the same obligations in Germany as local companies. We will help you obtain an exemption from withholding tax (Freistellungsbescheinigung) and resolve other related obligations.
Chemnitz-Süd Tax Office
For Czech companies and entrepreneurs, the competent authority in Germany is the Chemnitz-Süd Tax Office. Every Czech entity performing construction or assembly work on German territory is required to register with this office. The tax office will subsequently assign you a German tax number (the so-called Steuernummer) based on your application.
15% withholding tax (Bauabzugsteuer)
In German construction, the rule of withholding tax applies. In practice, this means that your client (the service recipient) is obliged to deduct 15% from each of your invoices and send it directly to the account of the Chemnitz-Süd Tax Office. As a provider, you will not receive the full amount. You can request a refund of this deduction, but only in the following calendar year. This principle applies throughout the entire subcontracting chain.
How to legally avoid the deduction?
- No deduction is made if your performance to a single client does not exceed 5,000 EUR per calendar year.
- The best solution is to obtain a withholding tax exemption (Freistellungsbescheinigung), which the Chemnitz-Süd Tax Office issues upon request after fulfilling tax obligations.
When do you also need to register for VAT?
If you use subcontractors (from any EU country, both VAT payers and non-payers) for construction or assembly work in Germany, your German tax registration automatically extends to VAT (Umsatzsteuer).
In such a case, you have additional obligations:
- To electronically submit preliminary VAT returns, always by the 10th day of the following month.
- To submit an annual VAT return by July 31 of the following calendar year.
Our tip: We will handle the exemption from the 15% withholding tax simultaneously with the VAT registration, so you have the money from invoices immediately in your account while fulfilling your legal obligations.
Are you planning to build in Germany?
Don't let your money be unnecessarily blocked by German authorities. We will take care of your registration with the tax office in Chemnitz, ensure the exemption from the 15% withholding tax, and keep track of all reporting deadlines.
Inquire about tax registration in Germany without obligation