Global payroll in Germany

Only 499 EUR per employee per month

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Rivermate's global payroll solution helps companies hire remote employees in Germany . We take care of global payroll, taxes, benefits, compliance and HR activities. So you can focus on growing your business. Our global payroll solution is beneficial to companies that want to hire remote employees in a breeze. On this page you will find employment information for Germany.

1. Grow your team in Germany with Rivermate as your global payroll provider

Payroll, benefits, taxes, and compliance can be difficult to manage in , particularly if you don't have established local relationships. You can hire employees in effectively, conveniently, and in full compliance with all relevant labor laws using Rivermate's global Employer of Record (EOR) solution. We handle the responsibilities and legal risks associated with foreign employment so you can concentrate on growing your company.

2. Introduction to global payroll in Germany

If you are interested in hiring a remote team in Germany, or even just individual remote employees in Germany, then you have come to the right place!

Rivermate is an Employer of Record (EOR) that offers Germany payroll solutions. As a Germany payroll provider, we will cover everything from salary, benefits, employer-to-employee contributions, and especially payroll compliance in Germany. We are confident Rivermate’s payroll solutions Germany will help you grow as a business—because now, you won’t have to worry about your payroll solutions Germany. We take care of everything payroll!

With Rivermate, you can run Germany payroll services in just one click—regardless of currency, benefits, insurance, and your local labor laws. Everything is automated. Our priority is for you to focus on your company’s strategy and growth.

Our Rivermate Global Payroll services are made especially for startups and scaleups. We know that startups try to be extra prudent when it comes to choosing a payroll provider, so it is our mission at Rivermate to be your most reliable and cheapest payroll provider option. So if you’re looking for global payroll providers for small businesses, look no further and book a call with us now!

3. How to set up global payroll in Germany

Setting up a business in Germany is a complicated process, partly due to the numerous financial filings that must be made. If you intend to hire and establish a subsidiary on your own, a tax advisor can advise you on various Germany payroll options.

To set up Germany payroll, you'll need extensive documentation from your employees, including:

1. Identification/passport

2. Permit to reside/visa

3. Tax identification number and bracket

four. a social security number

5. Bank information

Germany also specifies specific data protection regulations for payroll. Personal data and information can be collected for employment purposes, but you must keep that data secure and pay employees using Germany's File Transfer and Access Management (FTAM) protocol.

4. Taxation rules for global payroll in Germany

Germany has a variety of local tax laws that can be perplexing to those who live outside the country. Pay attention to individual income tax (IIT) for employees, social and health insurance costs, payroll tax, sales tax, withholding tax, and business tax when setting up your Germany payroll.

In Germany, corporate income tax is 15% plus a 5.5% surcharge. The country has a progressive income tax system, with tax rates ranging from 0% to 45% for those earning 274,612 EUR or more (as of 2021).

You will also be required to contribute to the German Social Security System, which is divided into five parts:

1. Medical insurance

2. Medical care insurance

3. Unemployment benefits

4. Pension protection

5. Accident coverage

Except for accident insurance, which is entirely covered by the employer, you will split these contributions equally with your employees. Plan to contribute an additional 20.7% of an employee's salary to the social security system.

5. Payroll options for companies in Germany

Companies that wish to expand their operations globally have four different payroll options in Germany. These payroll options are:

1. Internal Payroll. This payroll option is applicable for already established companies in Germany. It includes devoting an entire Human Resources staff to running the company's payroll procedures.

2. Remote Payroll. Smaller firms may lack the capacity to handle their own payroll, but they may add their workers to the parent company's payroll. This action, on the other hand, requires considerable thinking. You must guarantee that you follow the rules and laws of each nation.

Working with a local outsourcing firm is one method to retain money in the local economy, but you'll still need to study all of the local rules and regulations, since you'll be held responsible.

3. Germany payroll outsourcing: Outsourcing your payroll to an Employer of Record in Germany, such as Rivermate, is another alternative for Andorra payroll outsourcing. We can manage all aspects of your payroll, including compliance. Send us a note and we'll get back to you as soon as possible!

6. Payroll compliance Germany

It is the obligation of the employer to ensure that all payroll-related transactions are properly documented and recorded. All salaries and compensation payments must adhere to the local minimum wage as well as other applicable laws and regulations.

Rivermate's payroll services in Germany can assist you in staying in compliance with the country's ever-changing payroll rules. We provide an all-inclusive solution that covers everything from compliance and reporting to salary payments.)

7. How to manage payroll in Germany

Companies that have a business presence in Germany have different ways of managing payroll. However, most of the options you have for running payroll in Germany are either expensive or require establishing a subsidiary in Germany. The cheapest, most efficient, and most reliable payroll processing system in Germany is by outsourcing payroll to Employers of Record (EOR) in Germany. Rivermate is one of those Employers of Record.

At Rivermate, we offer you the most efficient, most compliant, and cheapest HR and Payroll Management services in Germany. We do this by taking care of your payroll-related needs, such as keeping track of your employees’ financial records, including incentives, gross and net salary, and payslips, all the while staying compliant with the labor laws in Germany. Because we do your online payroll management for you, you can have absolute focus on your business’ strategy and growth.

Rivermate is all about growth through collaboration and we achieve this by offering the most reliable yet cheapest services for managing payroll for small businesses in Germany.

8. Entitlement and termination terms in Germany

After the first six months of employment, all employees are protected by the German Termination Protection Act. Employers must have a specific basis for dismissing an employee, and there are several types of reasons (connected to the employee's personal condition, to the employee's behavior, or to the employer's business).

A written notice of dismissal must be signed by the employer's authorized representative. In general, ending employment without the employee's consent is a complicated process in Germany, which is why many terminations occur through mutual agreement.

9. Compensation in Germany

The minimum wage in Germany is currently at 9.60 EUR per hour.

On January 1, 2022, the statutory minimum wage is set to increase to 9.82 euros. On

July 1, 2022, the statutory minimum wage is set to increase to 10.45 euros.

10. Working hours and overtime in Germany

Although a six-day workweek is possible, the standard workweek is five days, eight hours per day. Employees are not permitted to work more than 48 hours per week. Daily hours may be increased to ten hours per day if the employee does not work more than 40 hours per week on average over a 24-week period.

Workers in industries that require continuous operation (e.g., hospitality, hospital services, and power generation) may be scheduled to work Sundays and holidays, but most other workers do not. Employees who work on a Sunday or holiday when they normally do not are typically compensated with a paid day off within two weeks.

Night work (between 11 p.m. and 6 a.m.) is typically compensated by a higher rate of pay or compensatory time off. A collective bargaining agreement or contract may specify how night work is compensated precisely.

11. Employee benefits in Germany

Pension insurance, health insurance, unemployment insurance, nursing care insurance, accident insurance, maternity insurance, and insolvency insurance are the seven components of the German Social Security System. Except for accident, maternity, and insolvency insurance, which are covered solely by the employer, contributions to those insurances are split equally between the employer and the employee. In total, the employer can expect to contribute approximately 20.7 percent of the employee's salary to social security.

Social security contributions, on the other hand, are only deducted up to a certain amount. In 2021, the maximum amount for statutory pension and unemployment insurance is 7,083 € (West) and 6,667 € (East) per month, and the maximum amount for statutory health insurance is 4,837 €.

Furthermore, employers frequently provide additional supplementary insurance benefits. Companies provide supplemental benefits based on collective bargaining agreements, corporate culture, and the nature of the professions.

12. Why choose Rivermate as your global payroll provider in Germany

Establishing an entity in to hire a team takes time, money, and effort. The labor law in has strong worker employment protection, requiring great attention to details and a thorough awareness of local best practices. Rivermate makes expanding into simple and effortless. We can assist you with hiring your preferred talent, managing HR and payroll, and ensuring compliance with local legislation without the hassle of establishing a foreign branch office or subsidiary. Our PEO and Global Employer of Record (EOR) solutions in give you peace of mind so you can focus on running your business. Please contact us if you'd like to learn more about how Rivermate can help you hire employees in via our Employer of Record (EOR) / PEO solution.

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