Ask a tax advisor on the topic of Cross-border commuter

temporary stay abroad within the EU

July 26, 2012 | 30,00 EUR | answered by Wirtschaftsprüfer André Hintz

My partner is being sent to Spain for work for 10 months. Due to my non-self-employed work in the IT industry, I have a relatively high percentage of home office work and would therefore like to move my main residence to Spain for this time. However, my apartment in Germany will not be dissolved as I will be regularly in Germany. The center of my life for this time will be in Spain.

Due to the registration law, I have to deregister in Germany and present this deregistration certificate in Spain for various official purposes. Therefore, deregistration is unavoidable for me.

In addition, I operate a small business on a self-employed basis with the distribution of my own software (maximum turnover of 5,000 euros per year, exclusively with customers in Germany).

1. What tax implications does deregistering my residence in Germany have?

2. What information (forms?) do I need to provide to the tax office so that I continue to be fully taxed in Germany? Taxation in Spain should definitely be avoided.

For my employer, there should be no change in the deduction of social security (already clarified with health insurance) and income tax. Payment to a German bank account, fully taxed in Germany.

3. Are there any major disadvantages to my temporary deregistration? Also with regard to the part-time self-employment.

Wirtschaftsprüfer André Hintz

Dear questioner,

I would like to answer your question within the scope of an initial consultation and based on your fee commitment, in accordance with the rules of the online portal. My response is based on the situation you have described.

If you officially move your residence to Spain, you will be subject to income tax in Spain. Each country treats its taxpayers differently, but generally all follow the principle of worldwide income. This means that all your income is taxable in Spain. Consultation in the field of Spanish tax law can only be provided by a Spanish tax advisor.

Exceptions usually exist through so-called Double Taxation Agreements (DTAs). There is such a DTA between Germany and Spain. This agreement clearly specifies which state has the authority to tax certain income. For Germany, it means that you are considered a limited taxpayer in Germany with the income you earn in Germany.

For a commercial enterprise that you operate as a sole proprietor, it depends on where you operate the business. If you only operate it on weekends in Germany, the taxation occurs in Germany. If you operate it from Spain, you are subject to tax in Spain with this income.

I hope my explanations have been helpful and remain

Yours sincerely,

André Hintz
Tax advisor