[artemonster]

do you know how in such cases salaries works? i.e. founder and employees are german and the company is in Estonia. Do they work as contractors? I thought to be a normal salaried employee you had to have the company also registered in germany too.

[AndroTux]

No, you don’t necessarily. Estonia has an e-Residency program targeted exactly at this scenario: Having a company in Estonia but living abroad. However, Germany being Germany, you will still have to deal with the Finanzamt and all the nice stuff that comes with it. So while you can run an Estonian company from Germany and be employed by it, I doubt you will gain much freedom from it. There’s really no escaping German bureaucracy without leaving the country.

[miohtama]

In theory, it should be possible for any EU citizen to work in any EU country.

In practice, it is not possible because you need to register to a local tax office of the worker. Spanish employee -> need to register your company with the Spanish tax office.

Good luck unless you can afford expensive legal services that do this for you. Does not make a sense unless you are planning to hire in quantity (>20 workers).

The alternative is that every remote worker is a subcontractor and takes care of their own taxes.

[formerly_proven]

> The alternative is that every remote worker is a subcontractor and takes care of their own taxes.

In Germany the pension insurance (DRV) will come around after a few years and demand a six digit figure from both your company and the employee, plus interest. You can also end up with criminal charges filed against you.