Social insurance: no registered office in Germany? The right way to register your employees
Social insurance is mandatory for employees in Germany - this also applies to employees of foreign companies who are not on temporary deployment here. We give you tips on how to register your employees correctly.
We regret, but most of the webpages and information leaflets mentioned are currently only available in German.
In the European Union (EU), the rule is that employees who work in one of the EU member states are subject to the social insurance obligations in that state - regardless of the country in which the employer’s registered office is located.
The legal basis for this rule is Article 21(1) of Implementing Regulation (EU) 987/09. This means that a foreign employer must register their employees in Germany for social insurance and pay contributions as if the company were based in Germany. Exceptions apply in two cases:
- Employees have been posted to Germany and are only working for their foreign employer here on a temporary basis (secondment).
- The employees are subject to an exemption agreement concluded by the social insurance institutions in the member states. The competent institution in Germany is the Deutsche Verbindungsstelle Krankenversicherung - Ausland, (DVKA) [German Liaison Office for Health Insurance Abroad].
How to register employees for social insurance in Germany
Apply for an employer identification number
Employers wishing to employ staff in Germany for whom social insurance is mandatory require a company number. This is assigned by the Bundesagentur für Arbeit [Federal Employment Agency] (you can access the online application form here). Employers can only register for the German social insurance institutions’ notification procedure if they have this number.
Choose your health insurance fund
Employees in Germany are free to choose their health insurance fund. Before starting their employment, employees must tell the employer which health insurance fund they have chosen. TK provides information in English for people seeking insurance. An overview of the online services available to insurees is provided in the TK-Versichertenportal [TK insurees' portal].
Register for German social insurance
Companies which employ staff in Germany for whom social insurance is mandatory must use a special online registration procedure. This requires the use of payroll accounting programmes that are authorised to exchange information with health insurance funds. If employers don’t have such a programme, they can use the free fill-in tool sv.net , which was developed by the health insurance funds. Information about the occupational classification code you will need for registration purposes is available from the Bundesagentur für Arbeit [Federal Employment Agency]. We also provide information about sv.net in our information leaflet "sv.net": Beratungsblatt sv.net (PDF, 95 kB) .
Paying contributions on time and sending contribution statements
One of the duties of employers in Germany is to send social insurance contribution records and pay contributions on time. These statements may only be sent online using system-tested accounting programmes or fill-in tools such as sv.net. Contribution records must reach the competent health insurance fund by the fifth-last bank working day of each month. You will find detailed information in TK’s information leaflet "Contributions record": Beratungsblatt Beitragsnachweis (PDF, 63 kB) .
Contributions are due on the third-last banking day of each month in which the staff member was employed.
Further information about paying contributions:
- a list of current due dates
- You can calculate social insurance contributions using our salary calculator.
- Our information leaflet sv.net tells you how to send social security notifications and contribution records through sv.net: Beratungsblatt sv.net (PDF, 95 kB)
- answers to frequently asked questions about the reporting procedure
Representatives in Germany
With effect from 1 January 2021, foreign employers with employees in Germany for whom social insurance is mandatory are required to appoint an authorised representative in Germany. The mandatory task of this representative is to keep payroll documents in German and store them for future audits (Section 28f. par. 1b SGB IV [German Social Code]. This can be the employee themselves or a third party (e.g. a tax consultant).
According to Section 28p SGB IV, the authorised representative can present the payroll documents for audit on their own premises or on the premises of the authority performing the audit. Section 98 paragraph 1 sentence 4 SGB X, which states that the audit must in certain cases be performed on the employer’s premises, does not apply if the authorised representative’s business premises are integrated into their private sphere. The foreign employer remains fully liable for the fulfilment of the obligations set out in the German Social Code, and the audit report will be addressed to them.
Sending annual reports
A notification regarding the employee's income during the year must be received by the health insurance fund no later than 15 February of the following year. This figure is used as the basis for calculating social insurance contributions. The health insurance fund then sends this notification to the competent pension insurance institution as part of an annual report.
Special situation: assigning contribution payments to employees
Are you an employer based outside Germany? If so, you can arrange for your employee in Germany to take over your task of paying contributions. The legal basis for this is Article 21(2) of Regulation (EC) 987/09.
This will enable your employee to notify the social security, submit contribution records and pay the entire social insurance contributions on your behalf. However, you as the employer will remain liable to the social security institutions for the payment of contributions.