What do I need to consider when working as a cross-border commuter in multiple countries?
December 10, 2023 | 60,00 EUR | answered by Selma Rosenblatt
Dear tax advisor,
My name is Emil Fischbacher and I work as a cross-border commuter in several countries. Currently, I am employed in Germany, but I also work regularly in Switzerland. I am unsure about what I need to consider in my tax return and what tax consequences it may have when working in multiple countries.
I am concerned that I may have to pay taxes twice or that there could be problems with the tax authorities because I do not know exactly which rules and laws apply when working as a cross-border commuter in multiple countries.
Could you please explain to me what tax aspects I need to consider as a cross-border commuter in multiple countries? Are there any specific regulations or tax treaties between countries that could help me save taxes and avoid problems? What documents and records do I need to prepare for my tax return, and are there any specific forms that I need to fill out?
I would be very grateful if you could provide me with specific tips and advice on how to optimize my tax situation as a cross-border commuter in multiple countries in order to avoid any issues with the tax authorities.
Thank you in advance for your help.
Sincerely,
Emil Fischbacher
Dear Mr. Fischbacher,
Thank you for your inquiry regarding your tax situation as a cross-border commuter in Germany and Switzerland. As a tax advisor with expertise in the field of cross-border taxation, I can assist you and explain some important aspects that you should consider in your tax return.
First and foremost, it is important to know that the taxation of cross-border commuters is usually regulated by double taxation agreements (DTAs) between the countries involved. These agreements are designed to ensure that income is not taxed twice and determine, among other things, which country has the right to tax and how income is allocated.
In your case, as a cross-border commuter working in Germany and Switzerland, the right to tax will usually lie in the country where you are resident. This means that you must declare and pay tax on your worldwide income in Germany, but also pay a withholding tax in Switzerland, as you work there.
To avoid double taxation, you should declare all income from Switzerland in your tax return in Germany and provide evidence that this income has already been taxed in Switzerland. You can do this by presenting certificates of taxes paid in Switzerland.
There is also the option to choose the application of the so-called progression clause if you work in Switzerland for more than 90 days a year. In this case, the Swiss income is not taxed in Germany, but is taken into account for the calculation of the tax rate.
To prepare your tax return, you should gather all relevant documents such as pay slips, certificates of taxes paid in Switzerland, residence certificates, and other supporting documents. You should also familiarize yourself with the specific forms for cross-border commuters available in Germany and Switzerland.
Overall, it is advisable to consult with a tax advisor or expert in cross-border taxation early on to optimize your tax situation and avoid potential issues. I am available for personalized advice.
I hope this information is helpful to you and I am happy to assist with any further questions.
Best regards,
Selma Rosenblatt, Tax Advisor
