The Netherlands and Germany Reach Agreement on Work-from-Home Tax Rules

Cross-border workers between the Netherlands and Germany are about to benefit from a significant policy update. The two nations have recently agreed on an amendment to their tax treaty, allowing cross-border employees to work remotely for up to 34 days a year without complicating their tax obligations. Under the new arrangement, the income from these work-from-home days will still be taxed in the country where the employer is located rather than where the employee resides.

What Does This Mean for Cross-Border Workers?

Traditionally, cross-border workers’ income is taxed in their employer’s country unless they perform the work elsewhere. However, the rise of remote work has created challenges in navigating tax rules. This amendment simplifies tax situations for cross-border employees, offering them more flexibility to work from home without worrying about altering their tax responsibilities.

Parliaments Still Need to Approve

Both the Dutch and German parliaments must approve this amendment for it to take effect. While this step is pending, the agreement signals a progressive shift in addressing remote work challenges. Additionally, the Netherlands and Germany have signed a declaration of intent to explore options for extending this arrangement beyond the 34-day limit in the future.

A Step Forward in Remote Work Policy

This move recognizes the evolving nature of work and the growing demand for remote work arrangements. While the 34-day limit offers a cautious start, talks of further extending this policy indicate a willingness to adapt to modern work trends.

Stay tuned for updates as the parliament deliberates on this significant change. For cross-border workers juggling international rules, this agreement could soon bring them one step closer to a more flexible and simplified working life.