The Luxembourg government has stated that agreements with neighbouring countries relating to tax and social security arrangements for cross-border workers working remotely in the corona crisis have been temporarily extended. This article provides details.

Extension of agreements on taxing cross-border workers

According to a press release issued by the Finance Minister on 22 June 2020, Luxembourg and Belgium have agreed to extend the amicable agreement of 19 May 2020 (see here) on the situation for cross-border workers within the context of combating the spread of COVID-19 until 31 August 2020.

According to a press release issued by the Finance Minister on 24 June 2020, Luxembourg and France have also agreed that the tax arrangement for teleworking within the context of combating the spread of Covid-19 will remain in force until 31 August 2020.

As far as the situation between Luxembourg and Germany is concerned, the amicable agreement of 3 April 2020 regarding tax for teleworking within the context of combating the spread of Covid-19 stipulates that this agreement will automatically be extended month by month if it is not terminated by one of the competent authorities, and should therefore continue to apply as it has not been terminated.

As a result, the days spent teleworking in accordance with the provisions mentioned above will continue not to be taken into account when calculating tolerance thresholds applicable to tax for Belgian (24 days) and French (29 days) cross-border workers until 31 August 2020, and to German cross-border workers (19 days) until the agreement in question is terminated.

Extension of the agreement with Belgium and Germany on social security affiliation for cross-border workers as far as teleworking is concerned until 31 August 2020

According to the press release issued by the Social Security Minister on 1 July 2020, the amicable agreement with Belgium on social security affiliation for cross-border workers who are teleworking is extended until 31 August 2020.

According to the press release issued by the Social Security Minister on 3 July 2020, the agreement with Germany on social security affiliation for cross-border workers who are teleworking is also extended until 31 August 2020.

This means that days spent teleworking due to the Covid-19 crisis will continue not to be taken into account when determining the social security legislation applicable to Belgian and German cross-border workers, in order to avoid a change to their affiliation if the 25% threshold is exceeded in accordance with European provisions.

As far as France is concerned, an official response should reach Luxembourg soon.

Originally published 17 July 2020/

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