Payroll Newsflash

Extension of cross-border agreements on social and tax matters

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Contents

Extension of cross-border agreements on social matters

Reminder of the rule: an employee must be affiliated with the social security of his residence country if he performs a substantial part (at least 25% of his working time and / or remuneration in case of remunerated activity) of his working activity in that Member State.

 

  • Extension of the agreement on teleworking for french cross-border workers

Luxembourg and France have agreed to extend the exceptional measure providing that teleworking days linked to the COVID-19 crisis are not taken into account in the determination of the applicable social security legislation to cross-border workers until 15 November 2021, which corresponds to the end date of the state of health emergency in France (Law n ° 2021-1040 of 5 August 2021).

This means that a French cross-border worker who performs his working activity from home due to the COVID-19 crisis continues to be affiliated with the Luxembourg social security system.

  • Extension of the agreement on teleworking for german cross-border workers

Luxembourg and Germany have agreed to extend the exceptional measure providing that teleworking days linked to the COVID-19 crisis are not taken into account in the determination of the applicable social security legislation to cross-border workers until 31 December 2021.

  • Extension of the agreement on teleworking for belgian cross-border workers

Luxembourg and Belgium have agreed to extend the exceptional measure providing that teleworking days linked to the COVID-19 crisis are not taken into account in the determination of the applicable social security legislation to cross-border workers until 31 December 2021.

 

Extension of cross-border agreements on tax matters

Reminder of the rule: bilateral agreements are concluded with Luxembourg in order to avoid any double taxation.

Through these agreements, the taxation is maintained at 100% in Luxembourg to the condition that the following thresholds are not exceeded:

  1. France: a maximum of 29 working days outside Luxembourg
  2. Germany: a maximum of 19 working days outside Luxembourg
  3. Belgium: a maximum of 24 working days outside Luxembourg (34 days from 2022)

 

  • French cross-border workers: the Luxembourg and French tax authorities have decided on September 13, 2021 to extend until 31 December 2021 the agreement providing that teleworking days exclusively linked to the measures implemented by French or Luxembourg governments in relation with the COVID-19 pandemic are to be excluded from the 29-day count.

 

  • German cross-border workers: the Luxembourg and German tax authorities have decided that the agreement providing that teleworking days exclusively linked to the measures implemented by German or Luxembourg governments in relation with the COVID-19 pandemic are to be excluded from the 19-day count until 31 December 2021.

 

  • Belgian cross-border workers: the Luxembourg and Belgian tax authorities have decided on 21 September 2021 to extend until 31 December 2021 the agreement providing that teleworking days exclusively linked to the measures implemented by Belgian or Luxembourg governments in relation with the COVID-19 pandemic are to be excluded from the 24-day count. From 2022, the threshold will be extended from 24 to 34 days.

 

Contact

For more information about these exceptional measures due to COVID-19 and how Grant Thornton can help, please contact our experts at the following email address: HRpayroll@lu.gt.com.