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Obtaining Post-Military Employment in Germany

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Greetings all.  I'm planning on retiring from the US Military in the near future and we are exploring employment options post-military in Germany.  I have been told that if one applies for a German Visa and obtains permanent residency status they would be ineligible to apply for NAF and Government Civilian positions (GS) because of permanent resident and SOFA status.  Can anyone verify if this true?

 

I understand that someone could apply for a GS or NAF job, following the mandatory waiting period post-retirement, but we are looking into full immigration into German residency because the German Finanzamt's tendency to back tack SOFA protected DoD personnel, especially in the Rheinland-Pfalz area.  To avoid the unnecessary tax trouble, we wanted to pursue residency.  However, my job options would be limited to either German only positions or contractor jobs.

 

Just looking to see if anyone can verify or provide more information on this.

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I don't have any information for you, but I moved your question to the appropriate forum section.

 

Good luck!

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48 minutes ago, Bier_me said:

Greetings all.  I'm planning on retiring from the US Military in the near future and we are exploring employment options post-military in Germany.  I have been told that if one applies for a German Visa and obtains permanent residency status they would be ineligible to apply for NAF and Government Civilian positions (GS) because of permanent resident and SOFA status.  Can anyone verify if this true?

 

I understand that someone could apply for a GS or NAF job, following the mandatory waiting period post-retirement, but we are looking into full immigration into German residency because the German Finanzamt's tendency to back tack SOFA protected DoD personnel, especially in the Rheinland-Pfalz area.  To avoid the unnecessary tax trouble, we wanted to pursue residency.  However, my job options would be limited to either German only positions or contractor jobs.

 

Just looking to see if anyone can verify or provide more information on this.

 

Congratulations on your future retirement!  It's never too early to start planning for a European exit.

 

You are correct about the exclusion from NAF or AF (GS and GG) employment based on German residency.  As soon as you receive your residency permit, you are "Ordinarily Resident" and will be treated as any German when applying for these jobs.

 

Concerning the Finanzamt targeting DoD personnel, I know of only three that were affected by this, and they all shared the same traits:

  • Civilian employees (one GG in RP, one GG and one GS in Hessen)
  • Stationed in Germany in excess of 15 years (one was over 30 years)
  • German spouses employed in Germany
  • Did not report their U.S. income on the spouse's German tax returns ***
  • Children completing German schools or universities
  • German vehicle driver's license (no U.S. license)
  • Membeship in German social clubs (golf or shooting)
  • No property ownership in the U.S.
  • Owned property in Germany (purchased with LQA)
  • No U.S. bank account

*** A fourth case I know of involved a GG employee who shared the traits above with the exception of reporting his U.S. income on his wife's German tax returns.  The Finanzamt did not pursue him like the others because his wife included a copy of his IRS Form W-2 with each of her returns and the Finanzamt chose to ignore it.

 

For the other three, the respective Finanzamt determined these personnel did not have any substantial ties to the U.S. and were in Germany for more than the employment.  The Finanzamt looked at the tax-exempt income but I can't remember how many years back they went.  The tax-exempt income included the Living and Quarters Allowance (LQA) and Post Allowance.

 

There is a 180-day grace period between U.S. Military retirement and AF/NAF employment.  However, there is a waiver process the hiring organization can use if appropriate.  The waiver requires a General Officer approval, but if the hiring organization writes a convincing justification, the waivers are usually approved.

 

I'm not following your thought process about applying for the residency permit in an attempt to avoid back taxes on any of your Military pay.  As soon as you register at your local Rathaus, which starts the residency process, you will immediately attract the attention of the Finanzamt (and other offices).  If the Finanzamt is interested in you, registering will make it much easier for them to set the hook in your wallet.  If you are concerned about potential back taxes, keep your legal distance as long as you can by maintaining your SOFA status.

 

Here are two options to consider if you want to retain your SOFA status and are not concerned with LQA should a potential dream GS job become available.

  • Apply for a part-time job with AAFES (at least 20 hours per week).  This won't pay much and will not include LQA, but you will receive full logistical privileges (Commissary, PX, MWR, etc.).
  • Apply for a DoD Contractor job that provides Technical Expert Status Accreditation (TESA).  The TESA job requires you to meet specific work experience, training, and education requirements, but you will have SOFA status, and full logistical privileges, and housing allowance if authorized in the contract.

A third option if you know of a GS job on a short horizon and you can afford to wait is to retire and do nothing for up to 90 days while enjoying your automatic tourist status.  As long as you do not accept contractor or AAFES employment, your transportation agreement will remain intact and you will qualify for LQA.  If you decided to take a trip back to the U.S. at the Government's expense after you retire, then you use your transportation agreement and will not qualify for LQA if locally hired.

 

I wish you the best!

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One option that hasn't been mentioned is to retire, go back to the US for 1-2 years and then apply for a GS job in Germany, with a new transportation agreement and qualifying for LQA. Perhaps less attractive than just staying in Germany, but many people end up doing this. And if you are worried about getting on the radar of the Finanzamt, this may be a safer bet.

 

Otherwise everything that @JG52 said, it is truly excellent advice in a topic where it can be tricky and confusing to get good information.

 

For what it's worth, I do know of cases where the Finanzamt is going after not just civilians but also active duty service members. How far this will go is anybody's guess but things become tricky with US-German marriages, kids in German school, property in Germany etc. Definitely don't register at the Rathaus/Einwohnermeldeamt unless you absolutely have to.

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Is there no double taxation treaty?

 

SOFA has become more of a hot potato up here in the Brit bit since Brexit, but the feeling so far is that uniformed are OK, civvies are not (unless they are careful).

 

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It's not really an issue of double taxation - there is of course a double taxation treaty in place between the US and Germany. But you as an individual can't simply unilaterally decide to just pay US taxes on your income if you are a resident in Germany (that would be awesome, of course).

 

Of course, people here under the SOFA aren't generally considered to be residents of Germany. The Finanzamt, however, seems to disagree in select cases, and that's where the trouble starts.

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