Question: How does the taxation of cross-border commuters work in Switzerland and Germany?
February 28, 2023 | 50,00 EUR | answered by Helma Fischer
Dear tax advisor,
My name is Daniel Schmitt and I work as a cross-border commuter between Switzerland and Germany. Currently, I am unsure about how taxation works in both countries and what tax consequences may arise for me as a cross-border commuter.
Currently, I work in Switzerland and commute regularly from my place of residence in Germany to work. In Switzerland, I am subject to taxation and pay my taxes there. However, I am unsure about how my income and taxes will affect me in Germany and whether I am also subject to taxation there.
My concern is that I may have to pay taxes in both countries, leading to double taxation. I would like to know how to properly declare my income as a cross-border commuter to avoid tax issues.
Could you please explain to me how taxation for cross-border commuters works in Switzerland and Germany? Are there any specific regulations or agreements between the two countries that could help me avoid tax issues? What steps do I need to take to fulfill my tax obligations as a cross-border commuter correctly?
Thank you in advance for your help and support.
Sincerely,
Daniel Schmitt
Dear Mr. Schmitt,
Thank you for your inquiry regarding taxation as a cross-border commuter between Switzerland and Germany. As an expert in international tax matters, I can assist you and provide you with information on the legal framework and possible solutions for your tax questions.
As a cross-border commuter working in Switzerland and residing in Germany, you are generally subject to taxation in Switzerland. This means that you must declare your income in Switzerland and pay taxes there. However, there is a double taxation agreement between Switzerland and Germany that ensures you do not have to pay taxes on the same income in both countries.
According to the double taxation agreement between Switzerland and Germany, your income is usually taxed only in the country where you work. This means that as a cross-border commuter, you will declare your income in Switzerland and be exempt from tax in Germany. However, you will need to provide a certificate of tax residence in Switzerland in order to claim this tax exemption in Germany.
To fulfill your tax obligations as a cross-border commuter correctly, I recommend consulting with an experienced tax advisor who is familiar with international tax matters. They can assist you in obtaining the necessary tax certificates, preparing your tax returns in both Switzerland and Germany, and optimizing your tax situation.
In summary, as a cross-border commuter between Switzerland and Germany, your income is typically only taxed in Switzerland, and you are exempt from tax in Germany. The double taxation agreement protects you from being taxed twice on the same income. To ensure that you fulfill your tax obligations correctly and avoid tax issues, I recommend seeking professional assistance.
I hope this information is helpful to you and I am available to answer any further questions you may have.
Best regards,
Helma Fischer
Tax Advisor
