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belgium and the netherlands conclude tax agreement for home workers. will other neighbouring countries follow suit?

Tax
14 May 2020

by Hannelore Durieu and Biene Ongenaert

Belgium and the Netherlands conclude tax agreement for home workers. Will other neighbouring countries follow suit?

Many Belgian employees, who normally work full or part-time in the Netherlands, must presently work from home. Working from home can have negative repercussions in terms of pay, which is currently taxable in Belgium. Belgium has consequently concluded an agreement with the Netherlands to address this issue.

Belgium and the Netherlands conclude tax agreement for home workers. Will other neighbouring countries follow suit?

Those engaged in international employment are taxable in the country in which they physically work. This means that those currently compelled to work from home due to the corona crisis are taxable in Belgium.

To avoid a change to the standard tax regime, Belgium has concluded an agreement with the Netherlands. This agreement stipulates that the standard tax regime additionally applies on those days on which an employee works from home as a result of the corona crisis. In other words, home working days are treated as if they had been performed in the usual country of work. The agreement provisionally applies for the period of 11 March to 31 May, but can be extended if necessary.

Measures pertaining to the taxability of compensation for temporary unemployment have also been decided, however, these have not yet been clarified.

Belgium is also in the process of negotiating solutions with other neighbouring countries. However, the normal rules will continue to apply as long as no agreement has been reached.

Do you work in an international context and have questions pertaining to working from home? Then please do not hesitate to contact your account manager or one of our specialists at contact@vdl.be

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Hannelore Durieu

Partner International Tax - Certified Tax Advisor hannelore.durieu@vdl.be

Biene Ongenaert

Senior Advisor International biene.ongenaert@vdl.be

Disclaimer
In our opinions, we rely on current legislation, interpretations and legal doctrine. This does not prevent the administration from disputing them or from changing existing interpretations.


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