The 183-day rule
The starting point is the double taxation treaty between Poland and Germany. Employment income is taxed where the work is performed — that is, in Germany. The exception applies only when three conditions are met at once:
- The stay in Germany does not exceed 183 days within any twelve consecutive months.
- The pay comes from an employer that is not resident in Germany.
- The pay is not borne by a permanent establishment of the employer in Germany.
Every day of presence counts, including arrival and departure days, weekends spent on site and sick days. A running calendar of stays costs less than a dispute with the tax office a year later.
Avoiding double taxation
The treaty uses exemption with progression: income taxed in Germany is exempt in Poland but raises the rate applied to remaining Polish income. A Polish return is therefore still required if any Polish income arose in the same year.
- Keep the German annual pay statement — it evidences the income and the tax withheld.
- A German tax return often produces a refund: commuting costs, a second household and meal allowances are deductible.
- A voluntary German return can be filed up to four years back.
Self-employed crews
For the self-employed, profit is taxed in the country of residence as long as no permanent establishment arises in Germany. A building or assembly site becomes one once it lasts longer than twelve months.
For construction services supplied to a German business, the customer accounts for VAT. The invoice is issued without VAT, showing both VAT numbers and the note:
„Steuerschuldnerschaft des Leistungsempfängers” — reverse charge; the recipient accounts for the tax.
When to bring in an adviser
- Contracts longer than three months, or a stay approaching 183 days.
- Several German clients within one year.
- Invoicing German companies directly through your own business.
- Family remaining in Poland and an open question about tax residence.