Lakshya raj khatri
Eugenio Pescimoro
PROLOY TARAN DAS
Hello,I'm an Italian PhD...
Hello, I'm an Italian PhD student in Germany with an Marie Curie-ITN fellowship. I've two question about my fellowship. The first one is if the Mobility Allowance has to be taxed or not. Because they simply add this amount to my salary, so that I have to pay a lot of tax on it. The second question concerns the reimbursements: now I'm in England for my work for some months and I've to pay all expenses for my travel and relocation on my own. The professor say that they are included in the Mobility Allowance, but I think they should be covered by the "Contribution to the Training Expenses". Is it true? Thank you
24 Comments
Dear Shikhar,
thank you for your reply! But i'm talking about the Mobility Allowance, that is different than the Living Allowance.
By adding the mobility allowance to the living allowance, because of taxes I get less than half my Mobility Allowance.
However I'll contact my Italian Contact Point.
Thank you
Stefano
Hello Stefano,
I'm ESR within ITN OILTEBIA, also in Germany,
concerning the mobility allowance: somewhere at your contract you could find that it relates to your personal mobility, so whatever travel expenses regarding your project you have should be reimbursed from the Project Budget. The name of the expenses category you've mentioned seems to be right.
Taxation: I have the same scheme, the taxes are calculated onto (salary+mobility), and also not satisfied. I'd be also glad to hear comments on this issue.
Regards,
Maxim
Dear Maxim,
I'm glad to find someone in my situation. I think that everyone agrees that I've not to pay my
travel expenses: I've just to prove it to University!
And about the taxation, as I wrote in my previous message, I think it doesn't make sense
this scheme, because in this way we get less then half the Mobility Allowance.
Thank you
Stefano
Dear Maxim,
I contacted the German National Contact Point about the salary and the Mobility Allowance.
Here is their reply:
"In Germany the living allowance and the mobility allowance are paid out together as your monthly salary. Both allowances together
constitute the employer's gross salary (Arbeitgeberbrutto in German) of which the employer’s + employee’s contributions to social security
as well as taxation and other mandatory deductions have to be made in order to arrive at a net salary (Arbeitnehmernetto). It is true,
unfortunately, that there are appr. 50 % deductions in total."
Reading on the web it seems that Germany is the only country where we have Mobility Allowance taxed.
Stefano
Hello,
Just finished a placement in Germany and can confirm that you will be taxed about 50% of your salary, which is nice of them. I also had the UK student loans company taking another 10% of my NET from that aswell, so a very big chunk disappearing.
I have just moved back to the UK and will be looking to claim back as much of the tax that I paid over there as I can, not sure how much that will come to but owrth a go.
Thanks
Regards,
Andrew
Hello all!
Although the financial rules may change from FP to FP, I think that the mobility allowances are subjected to correction cofficient but not to taxation.
"The amounts are subject to the applicable country correction coefficient specified in the Frame Work Programme to adjust to the cost of living of the country where the project is carried out."
This is true in my case. As I work in Belgium, they applied no correction and taxes! (ref: finances guidelines FP7 2011)
Only living allowances is subjected to both correction and taxation.
To be sure download the financial guidelines of your respective FP and see if they have mentioned anything about this.
Good luck!
Hi, I am Dr Reddy working as Postdoc in Germany under MCIIF. I am also facing the same problem with financial department. As per my invitation later issued by the university authority the mobility allowance (it is meant for travel to residing place and working place, and house rent) should be free from taxes. But, in my salary statement, the taxes are deducted for the sum of mobility and living allowances. I discussed the same problem with the person in my university who is representative of ERO, and came to know that it is the Germany Govt. policy and applicable for all fellowship holder who are funding from ERO.
In my opinion, practically it is not correct since it will send something wrong sign. So, I wish to request the Govt. or some authority to make it more transparent. Based on the invitation letter with hidden issues, I wrongly planned to visit to Germany since the salary what I am received is 50% less in my gross and I am not happy with my life here and not able to go back to my country. Really pathetic!
asfds
Hi,
My ten cents on this problem: German tax law deals with some mobility issues. If you make a tax declaration, you can deduct the following from your taxable income, (i) moving expenses, (ii) travel to work at a rate of 30 cents per km and (iii) double household expenses.
The most substantial of these deductions is double household status. If you still rent or own a dwelling in the place you come from and that is the centre of your world, you can deduct your German rent and some other living expenses from your taxable income. The important factor is that you carry the costs of two households through your job-driven mobility - in fact you only need to show that you carry some of the costs of the household in your home place. There is a special allowance for daily living expenses in the first months at a given rate per day. Other expenses such as trips home are also covered. Double household doesn't apply to all Marie Curie Fellows but certainly to some. Some scientists will have a spouse and children living and going to school in their home country: for such people they can easily get double household without many questions. If your contract says you are a "Gastwissenschaftler" - visiting scientist - this can make acceptance of double household easier. Most important to keep everything well documented and keep all relevant receipts.
Some problems with this: I personally didn't have any dwelling of that kind in my home country and making a tax declaration in what is for most of us a foreign language is difficult enough. Nevertheless I helped two colleagues (Marie Curie Fellows) to get a refund of over 2000€ and they had relatively cheap flats in a small East-German town. If you were paying rent in Munich or Stuttgart, this would be considerably more.
Moving expenses are actual moving expenses - rental van, moving company, travel expenses to Germany, trips to find somewhere to live and the like. All Marie Curie Fellows can apply for this.
There is software to deal with tax declarations. I use one from WISO that costs about 20€. Elster is a source for electronic pdf tax forms and is free. This is all in German of course. The finance forum on http://www.toytowngermany.com/ has a lot of info and is very good for asking questions. Of course you could hire a tax accountant - Lohnsteuerberater - at a cost. In the first year things can be a little complicated, it is necessary to disclose all earnings in the year to the point you came to Germany. These earnings aren't taxed but your total worldwide earnings contribute to the rate at which you are taxed. If you didn't work in the year to that point or were paid less than in Germany (before tax), then you can expect a refund.
As regards 50% taxes, I guess that also includes the contribution to pensions. You can claim a pension contribution refund, if you leave to a non-EU country and have made less than 5 years contribution. In this way you can reclaim around 9% of your salary as a lump sum on leaving Germany. The pension fund swallows the employer contribution (also around 9%) and only returns the employee contribution. Your fellowship pays for both - this is the main complaint with the funding of Marie Curie Fellows in Germany - if the fellowship would add some percent to the multiplier for Germany to account for this cost it would help a lot. The employer has no budget to pay this themselves and they take it from the fellowship out of pure practicality. For people who will spend their whole lives in the EU, there is a system to enable a "fair" treatment of pensions at the time of retirement. We'll have to wait to see what the authorities say in many decades time.
As I said, my ten cents. My opinion is that Germans with a rudimentary knowledge of their own tax system can "plan" their affairs before moving to take advantage of the system. Foreigners have a higher barrier to access such knowledge.
Disclaimer: I am not a tax advisor and this post is solely my personal opinion.
Dear all,
I have been reading your comments and I totally agree. I am a non-EU citizen and doing my PhD in Germany. Now I am in my last year and I already started to worry about all this tax refund!
I have been reading and asking, and learned that we can not ask refund for the unemployment and for the assistance of senescence tax. I wonder why we are paying all those taxes, if we are not allowed to profit as being a non-EU citizen. When our residence permit expires we are supposed to leave the country. I perfectly understand that there are some rules to be fulfill (that the contact has to be prepared by the rules of the country) but nevertheless these rules are causing inequality among Marie Curie fellows. Specially for non-EUs.
Another important point, when I signed my contract it was prepared in German. Next to it I had a brief translation of the contract in English, however not one to one translation and I was not allowed to sign the English version. At that time, I haven't paid so much attention and signed only the German one. After one year we had our kick-off meeting, where we had the chance to speak with our project officer and he told us that this is absolutely not correct. He mentioned that we should never signed any kind of document in a language which we don't understand. The university insists that the contracts has to be signed in German!! I wonder if you guys had the same experience..
In conclusion, I see that we have very nice conditions but I wonder how they are regulated. It seems that each country, university is applying what else seems them more convenient and comfortable and this leads to inequality and decrease the quality of the rules of Marie Curie Fellowships. I wish there would be a better control to all these organisms in order to raise equality.
I just wanted to share my opinion of view!
Good luck to all of us!
Hi Zeynep,
My understanding is that if the contract were in English, even then a German translation would be legally binding before a German court. The University has some standard contract in German and is worried that a translation into English and back into German mightn't have exactly the same meaning. It's like you said, it's easy, practical and convenient for them to do it that way but lazy.
The main problem for non-EU Fellows, who do not meet the 5 years limit for a German pension, is that the half of the pension contribution that should be paid by the employer is actually paid out of the fellowship. In practice, the employee contribution and the employer contribution come from the same place - the Fellowship. The Fellow may have worked hard to write a successful project proposal and then loses half of their pension contributions. There are in principle three ways to change this: (i) the employer pays the employer contribution (unlikely), (ii) change German law (unlikely) or (iii) get the European Commission to increase the multiplier for German Fellowships by 10%. My guess is that some Fellows would still complain even if the multiplier increased - they would think they were losing more money. As far as I can see, this is not specifically discrimination against non-EU Fellows: if an EU Fellow has not worked before and leaves straightaway after their Fellowship to work in an non-EU country for the rest of their lives, they would also lose the contribution. Many scientists leave to go to Australia or the USA or elsewhere in the world. Of course for non-EU Fellows, it is more likely that they will lose it.
Michael Nones is starting a German Chapter of the MCAA: https://www.mariecuriealumni.eu/posts/hello-all-i-am-interested. I think such issues should be top priorities for this Chapter. At least Fellows need a well-written explanation of the issues facing them at the very beginning of the Fellowship. A German chapter and this forum provide somewhere for people to at least get some information and advice and might even be able to raise the problem directly with the Commission.
As regards making a tax declaration, it is almost always worthwhile to make a tax declaration in Germany. If even just to claim back your transport costs to work and back home.
All the Best,
Brian
Ciao Stefano,
I had a Marie Curie IEF fellowship in Dresden, until June 2014, and I got the mobility allowance tax free. And this according to the German tax law (Einkommensteuergesetz). I even have a document from the Dresden Tax Office stating this. I would be happy to publish a scan of the document (it is in German) on this website, if someone tells me how to do it.
I now have some questions about the mobility allowance being taxed in the UK. In fact I now hold a Marie Curie IEF fellowship in the UK. I will publish another post on that.
From my experience (this is my third Marie Curie fellowship so far), I can tell you that the financial issues are not always handled properly at the host institutions... Most fellows think that it is the European Union and the University taking care of their money, so they rely that they do it correctly. It is unfortunately not always like that.
Ciao,
Maria Paola
It is very nice to hear that Maria Paola Bissiri has received mobility allowance without tax. Really it is good news for us since when I enquired about this issue, one official totld me that German taxation policy is same for all the European Fellowships holders. If we get this supporting inforamtion from Maria Paola Bissiri it could be easy to get the tax free mobility allowance from the univeristy authorities. So, I am requesting MPB to share the scan document if possible through this website or personal e-mail ids. My e-mail id is dr_nkreddy@rediffmail.com. Waiting for your information.
Hi Nandanapalli,
I just scanned the document and sent it to you per e-mail. Maximum divulgation!
It is important that the European Research Agency of the European Commission demands and obtains from all European Countries that all Marie Curie fellows receive the mobility allowance tax-free. We should bring up the issue with the ERA. Can the Marie Curie Alumni Association do this?
The ERA should require that in all European Countries the local tax law allows the mobility allowance to be tax free. If an European country does not have such law, it should not be allowed to host Marie Curie Fellows! This is the way it should be. The European countries want us, because we bring work, we bring taxes, but they should not steal from us from the mobility expenses contribution.
It is not acceptable that they tax the mobility allowance and it is also not acceptable that we fellows should be wasting time taking care of this issue, discussing it with the host institution, with the National Contact Point etc, while we should be doing research instead. The ERA should take care of this and obtain that in every country we go the mobility allowance is tax-free.
Maria Paola
Hi,
I don't know how to share the document through this website, but I put it on the Google drive. Everyone can view it here:
https://drive.google.com/file/d/0B_GMxUl6PbwJZnY3bE5rVjFzcjA/view?usp=sharing
Ciao,
Maria Paola
Hi Maria Paola, hi everybody,
I was surprised when I've read that Maria Paola's mobility allowance was not subjected to tax. I am also the first Marie Curie fellow in my uni and they had a lot of difficulties to figure out how the contract should be prepared, how the payment should be done etc etc... But at the end, as many other fellows my mobility is also subjected to tax. So they sum mobility and living allowance and this is my Brut. They said to me that if I don't want the mobility to be subjected to tax, this money is not transferred to my account but instead it would stayed at the uni account. Which means then, I have to bring the invoices to get refunded every time I make an expense for my mobility, and they would refund me... This sounds to me so strange and also not convenient. (Why should I let the uni maintain my mobility allowance?) Then I preferred to be subjected to tax and this is the way I am paid since 2 years.
I wonder if this document which you send us is specially accepted in Dresden Regional Government or it is valid for all country? My German is enough to understand this but I am thankful that you shared with us.
Nevertheless, I totally agree with you. It is not acceptable that we fellows should be wasting time taking care of this issue, discussing it with the host institution, with the National Contact Point etc. I feel really not convinced about how my university is conducting my administration work. They even did not let me sign the contract in English.
The ERA should take care of these issues and provide that in every country the same criterioa are applied for payment. The only thing which differs should be the Coefficient Factor and the taxes of the country but not other conditions. Just only in this group we see that fellows from the same country are subjected to different conditions.
I hope our comments can be helpful for further discussion.
Best,
Zeynep
I was surprised to read here that other fellows get the mobility allowance taxed in Germany. I thought this is an issue in the UK but not in Germany. You don't need to show receipts to get the mobility allowance, sice this is a "flat rate contribution" as stated in the Work Programme. Search for work programme 2013 ief people and you'll find it. It says that all deductions should be made from the living allowance and that the mobility allowance is an expenses contribution to be paid to the researcher. Check also the guide for applicants (I mean the one for the IEF fellowship in my case). These documents also say that all the money allocated in the living and mobility allowances should be spent on the benefit of the researcher, there should be no money left there at the end of the project. Your University does not seem to be handling the finances correctly... No surprise, I have bad experiences myself with the financial management here with my Marie Curie in the UK and also with my previous Marie Curie in Germany. God knows what they did with my first Marie Curie in the Czech Republic, all documents were in Czech, there I always had the feeling that my salary was lower than it should be. The document I sent is citing the German federal tax law, which is valid all over the country. It seems to me that a person of HR of my host institution of my previoys Marie Curie, the Technical University of Dresden, enquired the local tax office if the mobility allowance should be taxed. The document I posted is the answer of the Dresden II tax office, stating that mobility allowances should be tax free accordig chapter 3 paragraph 64 of the Income Tax Law (Einkommensteuergesetz, you can find it in Internet). Here it says that the mobility allowance is meant to be tax free if national legislation allows it, all correct except the suggestion to ask the NCP, since it appears that they can give wrong information on this issue.. http://tinyurl.com/pdkewzw The national legislation is for a tax free mobility allowance, so there is no point that this allowance should be taxed in Germany. It is really a shame how the thing is handled, considering that we are foreigners in our host country, sometimes we don't even speak the language, so most fellows don't even find out that the host institution is handling the finances badly. Marie Curies is probably turning triple saltos in her grave... Ciao, Maria Paola
Hi Maria
What you brought here is very very interesting. Thank you.
I am a Marie Curie fellow in Denmark and here my moblity allowance+ salary both are taxed.
I am following this conversations for a while. At the beginning I understood that it depends on the host country law if the mobilty allowance is taxed or not. Now I see that there are differences on the application. I am a bit confused about which kind of action I should take...
It would be great to hear if there is any fellow in Denmark.
Any input is appriciated. Thanks!
Best
Cigdem
I have been following your comment and discussion for a while. I completely agree that university administrations are not very well informed about the rules and the researchers have to suffer.
Just putting forward Italy case. Here, the salaries for PhD students differ from region to region and even university to university in same region. Students who have Ricerca Scientifica contract as marie curie PhD student, receives Euros 3300/- per month for 36 months contract and students who have co.co.co. contract for same position, receives Euros 2183/-, which is a huge difference.
For national pension scheme (INPS), researchers pay Euros 340 (one third part) and university add another two third part, so total will be around Euros 1150/- per month as INPS. So, for 36 months, it will be around Euros 37000/-. however, according to Italian guidelines, this money can neither be transfered to another pension fund if researcher leaves the country or will be given if researcher dont spend more than 5 years in the country and apply for Permanent Resident (for non-Europeans).
I heard from some friends that rule for pensions are different for different countries and they can ask for refund upon leaving. I think Euros 37000/- is a big amount that non-EU researchers will not receive if they leave the country upon ending of contract.
Dear Stefano
The living contribution is to be added to your total salary and taxed. Its right. However, you must be reimbursed for your training abroad for travel, accomodation and food.
If you have any query, contact the National contact Point of your country. In Italy, it is
To contact NCP in Italy
http://www.apre.it
Good luck.
Thanks
Shikhar