what type of agreement this agency wants to offer me?
Thread poster: ocedeutsch
ocedeutsch
Spain
Jun 2, 2016

Hello everyone!

Firstly, let me say that I am totally new in the translation world. I was given an offer from a translation agency. They told me that they would pay me per word and I should give them a rate. If my rate meets their budget they would assure me an amount of at least 16.000 words per month during a year.

In order to give them a rate I told them that I have to know beforehand what type of contract I'd be given or If I would have to register myself as a freelancer.

The response was that we would make an agreement, that I wouldn't have to register myself as a freelancer and that they do not pay taxes to their translators since their headquarters are in Scotland.

Well, let me honestly admit that I didn't understand the answer given and that I still don't know whether I have to pay taxes or not.

I am at the moment living in Germany as a student so I am not registered here as freelancer either.

As exposed I am a newbie in this world, could you please help me?

[Edited at 2016-06-02 17:14 GMT]


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Sheila Wilson  Identity Verified
Spain
Local time: 20:52
Member (2007)
English
+ ...
We all have to start somewhere and you've come to the right place for advice. Jun 2, 2016

ocedeutsch wrote:
If my rate meets their budget they would assure me an amount of at least 16.000 words per month during a year.

I don't mean any offence at all by this, but you clearly don't understand the business. So why are they offering you the earth? For a beginner, that volume would take you uo to two full weeks of 8-hour days per month. Do you have that time available? Would you want to risk spending so much on one company - bearing in mind that we only get paid some time after handing in the work? Why would they even want to promise you regular work before knowing how well you translate? It all sounds very fishy to me.
I told them that I have to know beforehand what type of contract I'd be given or If I would have to register myself as a freelancer.

The response was that we would make an agreement, that I wouldn't have to register myself as a freelancer and that they do not pay taxes to their translators since their headquarters are in Scotland.

Well, let me honestly admit that I didn't understand the answer given and that I still don't know whether I have to pay taxes or not.

Of course you have to pay taxes! Anyone who earns anything in Europe and most other places in the world has to pay tax on their income. What sort of agreement were they talking about? Presumably not an employment contract if they aren't going to pay any tax. I can't imagine what else they had in mind. It sounds to me as though you would be self-employed and therefore responsible for paying your own taxes.

I am at the moment living in Germany as a student so I am not registered here as freelancer either.

I don't know what you have to do to work legally as a freelancer in Germany. Some countries such as the UK have virtually no procedures - you just pay taxes and social contributions on what you earn - while others, such as Spain, insist on registration and then take a minimum of over €250 per month in social contributions even before tax is thought of.

Are you serious about being a translator? Is that what you're studying? If not, I think you should find a safer, steadier way of earning some money during your studies. If you see it as a start of a career, I think you'd be wise to pass on this company unless they become a lot more transparent. You need to start small - and legal - and grow into the job. Meanwhile, spend very many hours here on ProZ.com. Not looking for jobs but researching how to set yourself up as a freelance translator and the pitfalls to avoid. Research is one of the most important skills for a translator, so you'll be learning how to business and honing your skills at the same time.

Remember that a freelancer is actually a small business owner, and that isn't something to jump into without preparation.


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Maxi Schwarz
Local time: 14:52
German to English
+ ...
In other words Jun 3, 2016

If my rate meets their budget they would assure me an amount of at least 16.000 words per month during a year.....

If they can pay you a really low amount, then they will get you to spend long hours doing lots of work, which they can sell to their customers for much more money and make a tidy profit. It's always the same story. We all get contacted by agencies who "offer" us large volume work with the expectation of a low fee from us, because getting large volume work is supposed to be considered as wonderful.

If you are new to translation, do small jobs first, make sure you have plenty of time to do them properly, and charge what a well done product is worth. Make sure you know how to translate, though.

In the kind of transactions you cited, the lines between employment and freelancing get blurred. In freelance translating, a client hires me for ** a ** project. It is not an ongoing relationship. If they like my work and need more, and if I like working for them, they may hire me for another project. Preferably I have different clients and am doing various projects for them. If a single client gives me "at least 16,000 words per month" and I am charging next to nothing for the privilege (to their profit), this prevents me from having time for other clients who would be willing to pay me much more.

There is nothing attractive about large volume work, especially for an unknown client who risks becoming your own client, and who also expects you to meet what is probably a low budget on their part.


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Katalin Horváth McClure  Identity Verified
United States
Local time: 15:52
Member (2002)
English to Hungarian
+ ...
Some reading, for a starter Jun 3, 2016

http://wiki.proz.com/wiki/index.php/Determining_your_rates_and_fees_as_a_translator

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Samuel Murray  Identity Verified
Netherlands
Local time: 21:52
Member (2006)
English to Afrikaans
+ ...
@Oce Jun 3, 2016

ocedeutsch wrote:
They told me that they would pay me per word and I should give them a rate.


Since you're a student, make your rate the same as the average rate for your language combination. Don't make your rate lower than that.

http://search.proz.com/employers/rates

If my rate meets their budget they would assure me an amount of at least 16.000 words per month during a year.


As a newbie translator, you'll be translating a lot slower than an established translator. Expect your speed to be less than 200 words per hour. Don't kid yourself about how many hours a day you can translate -- you are a student, and you'll translate in your spare time only. So... shall we say 2-3 hours per day? That's 500 words per day, i.e. 2000 words per week, i.e. 7000 words per month. You won't be able to do 16 000 words per month.

In order to give them a rate, I told them that I have to know beforehand what type of contract I'd be given or If I would have to register myself as a freelancer.


Why do you think that these two things (i.e. the type of contract, and whether or not you should be registered) are relevant to the rate that you would charge?

A recent post here on ProZ.com indicated that freelance translators in Germany do not have to register themselves as freelancers, but I'm sure there must be citizens' advice bureaus in Germany, too. Perhaps the German chamber of commerce or German company register web site has information about whether freelancers should register or not.

Between non-EU countries, someone on a student visa can't do any work in the country, but I'm not sure how it would work in the EU. Would you lose your student status if you start working? Surely your university's advice department could give you advice on that.

The response was that we would make an agreement, that I wouldn't have to register myself as a freelancer and that they do not pay taxes to their translators since their headquarters are in Scotland.


Yes, they would send you a contract to sign, and the contract says that you're not employed by them and that you can refuse any work that they send you, if you want to, and that they will pay you after you send them an invoice for each job that you do for them. You don't have to pay any tax in Scotland, but you do have to pay tax in Germany (and possibly also in Spain). The big question is: what kinds of taxes?


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Samuel Murray  Identity Verified
Netherlands
Local time: 21:52
Member (2006)
English to Afrikaans
+ ...
@Maxi Jun 3, 2016

Maxi Schwarz wrote:
In freelance translating, a client hires me for ** a ** project. It is not an ongoing relationship. ... If they like my work and need more, and if I like working for them, they may hire me for another project.


Yes, but do you sign a new contract with every new project? It is not uncommon for translators and agencies to sign a single agreement (or a single set of agreement) at the start of their relationship, that govern all future projects.


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Angela Rimmer  Identity Verified
United Kingdom
Local time: 20:52
Member (2014)
German to English
+ ...
Type of contract COULD affect rate Jun 3, 2016

Samuel Murray wrote:

In order to give them a rate, I told them that I have to know beforehand what type of contract I'd be given or If I would have to register myself as a freelancer.


Why do you think that these two things (i.e. the type of contract, and whether or not you should be registered) are relevant to the rate that you would charge?



Well... not to be picky, but it is sort of relevant. If you are an employee, your employer would normally cover things like health insurance contributions and would deduct your income tax, so your rate *could* be lower because there is less admin and fewer additional statutory payments to make, plus more benefits and protections.

I was once asked to return to my old employer on a freelance basis to cover someone's maternity leave. When I was negotiating my fee for this period, someone remarked that my fee was "way more than what even [they were] earning as the manager". I replied, yes, because unlike you, I don't get paid sick leave, I don't get statutory holidays, I don't have an employer paying my national insurance, and I have to incorporate admin costs for things like accounting and bookkeeping because those tasks fall into my sphere of responsibilities as a self-employed individual. I am also taking a risk of accepting a full-time job but for a very limited amount of time and with none of the added benefits of full-time employment. I would have to turn down other work from other clients, and I had no guarantee of additional income once this contract was complete. They conceded that actually, when those things were taken into account, my fee seemed more reasonable.

[Edited at 2016-06-03 06:35 GMT]


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Philippe Etienne  Identity Verified
Spain
Local time: 21:52
Member
English to French
Alas a very common comparison, even amongst freelancers! Jun 3, 2016

Angela Rimmerwrote:
...someone remarked that my fee was "way more than what even [they were] earning as the manager". I replied, yes, because unlike you, I don't get paid sick leave, I don't get statutory holidays, I don't have an employer paying my national insurance, and I have to incorporate admin costs for things like accounting and bookkeeping because those tasks fall into my sphere of responsibilities as a self-employed individual. I am also taking a risk of accepting a full-time job but for a very limited amount of time and with none of the added benefits of full-time employment. I would have to turn down other work from other clients, and I had no guarantee of additional income once this contract was complete. They conceded that actually, when those things were taken into account, my fee seemed more reasonable.

My reply to this obtuse reasoning:
Take your wage, double it, that's what you actually cost the company you work in (a basis for argument in European standards).

Philippe


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Christiane Bowien-Böll  Identity Verified
Germany
Local time: 21:52
English to German
+ ...
quite easy in Germany from the administrative point of view Jun 3, 2016

Hi,

you don't have to register as a freelancer. Of course, you need a tax number. If you don't have that already turn to your local Finanzamt.

At the end of the year your pay tax on your income.

No VAT is being paid on invoices to customers outside the EU, you simply mention on your invoice "nicht steuerbar nach §3, Abs. 2 UstG".

For invoicing within the EU you need to know the VAT-number of your client (http://europa.eu/youreurope/business/vat-customs/cross-border/index_de.html).

That's all. You work, make out invoices, receive payment, pay income tax at the end of the year.

What makes it complicated in your case is the fact that you are a student. As a student you have a different social insurance status, right?

As a freelancer you would have to pay appr. EUR 380,- a month to your health insurance. That would be the lowest rate as far as I know. (You could keep your freelance work a secret, of course, but that would be illegal and I'm afraid nowadays Finanzamt and health insurances work together. Nothing can be kept a secret from the Finanzamt.)

16 000 words a month is too much for a student in my opinion.


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ocedeutsch
Spain
TOPIC STARTER
Steueridentifikationsnummer Jun 3, 2016

Ceebeebee wrote:

Hi,

you don't have to register as a freelancer. Of course, you need a tax number. If you don't have that already turn to your local Finanzamt.

At the end of the year your pay tax on your income.

No VAT is being paid on invoices to customers outside the EU, you simply mention on your invoice "nicht steuerbar nach §3, Abs. 2 UstG".



Thank you everyone for the useful answers.

I quote your post because I see that you know how things work in Germany. I do have a Steueridentifikationsnummer, so what I would have to do is keep the invoices and report them under my Steuer-ID to the Finanzamt at the end of the year. Then they would just let me know how much taxes on income I have to pay, am I wrong?


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Maxi Schwarz
Local time: 14:52
German to English
+ ...
answering Samuel Jun 3, 2016

Samuel Murray wrote:

Maxi Schwarz wrote:
In freelance translating, a client hires me for ** a ** project. It is not an ongoing relationship. ... If they like my work and need more, and if I like working for them, they may hire me for another project.


Yes, but do you sign a new contract with every new project? It is not uncommon for translators and agencies to sign a single agreement (or a single set of agreement) at the start of their relationship, that govern all future projects.

In 25+ years of full time freelance work, I have rarely run into contracts with anyone. Why is there need for any contract, or at least anything fancy? My professional ethics are already covered by my organization, the ATIO. You want me to translate Document Y for my quoted price of $nn.nn by (date), which I will deliver to you by that date, in full, for that price. That's all that is needed.

I have seen contracts here and there, and they actually did not make much sense to me.


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Sheila Wilson  Identity Verified
Spain
Local time: 20:52
Member (2007)
English
+ ...
Same for me (in about 19 years) Jun 3, 2016

Maxi Schwarz wrote:
In 25+ years of full time freelance work, I have rarely run into contracts with anyone. Why is there need for any contract, or at least anything fancy? [ . . . ] You want me to translate Document Y for my quoted price of $nn.nn by (date), which I will deliver to you by that date, in full, for that price. That's all that is needed.

I rarely see either contracts or POs. Emails work very nicely for my clients and I. The few contracts I see are just expanded T&C at a very general level, more about non-compete clauses, privacy and confidentiality than anything much else. They never refer to actual rates as those are always negotiated on a per-job basis, but they do cover each and every job, for ever. I guess the ones I signed many years ago are still in effect to some extent, but they don't commit either party to anything if there isn't any work being done.

OP: Don't forget that rather large amount of social security that probably has to be paid, will you? It's just as important to pay that as the tax. You may not benefit much from it (retirement, maternity leave, industrial accident... aren't likely to pay out, and even healthcare may not be needed) but you can't avoid it and work legally. If Germany requires you to contribute to it as a freelancer then that's what you need to do as our "international" businesses - small as they are - are not easily hidden from view the way you can hide the fact that someone local is building you a website or designing a logo., or even translating something.


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Tomás Cano Binder, BA, CT  Identity Verified
Spain
Local time: 21:52
Member (2005)
English to Spanish
+ ...
You lucky ones! Jun 4, 2016

Sheila Wilson wrote:
I rarely see either contracts or POs. Emails work very nicely for my clients and I.

You are incredibly lucky. I have contracts with 95% of my customers, and every time a new customer comes around, they ask me to sign a framework agreement and an NDA (non-disclosure agreement). There is virtually no escape from paperwork today!


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Tomás Cano Binder, BA, CT  Identity Verified
Spain
Local time: 21:52
Member (2005)
English to Spanish
+ ...
Not true Jun 4, 2016

ocedeutsch wrote:
Firstly, let me say that I am totally new in the translation world. I was given an offer from a translation agency. They told me that they would pay me per word and I should give them a rate. If my rate meets their budget they would assure me an amount of at least 16.000 words per month during a year.

A sensible client would not promise lots and lots of work before they have even seen a first translation. If they are doing this it is either A) because you might not be clear enough about the fact that you are still a student/newbie or B) because they want to lure you into offering a very low rate...


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