Vol. 419 No. 2
42 Mr. J. O'Keeffe asked the Minister for Finance whether there is in existence a double taxation agreement between Ireland and Germany and, in particular, if tax deducted from the earnings of Irish students working over the summer holidays in Germany can be reclaimed by them.
Ireland has a double taxation agreement with Germany. This agreement, in common with Ireland's other double taxation agreements, has no provision dealing directly with the taxation of students employed in either country during the course of their summer holidays.
The question of whether or not a student is entitled to claim a refund of tax paid in Germany is a matter for the individual to take up with the German tax authorities.
A student working in Germany for the summer would be liable to tax in Germany, subject to the provisions of domestic German legislation, and also in Ireland in accordance with Irish tax legislation under which an Irish resident is subject to taxation on all income from whatever source arising. The provisions of the Ireland/Germany double taxation agreement come into play in these circumstances and in the assessment to Irish tax of the income earned by a person in Germany, a credit would be available for any tax paid on that income there.
I understand that special arrangements exist under German domestic regulations under which students of foreign educational establishments do not have to pay tax in Germany if certain conditions are met. These are: (i) the employment must be training related, i.e. it must relate to the student's course of study; (ii) the student's stay in Germany must not exceed 183 days in a calendar year; and (iii) the monthly salary must not exceed DM1,000.
If the limit of DM1,000 is exceeded, then the entire salary is subject to tax. If a student considers that he/she meets the above requirements then an application should be made to the appropriate German tax authority.
