What happens to my salary if I work as a cross-border commuter?
October 24, 2023 | 60,00 EUR | answered by Paula Bauer
Dear tax advisor,
My name is Felix König and I work as a cross-border commuter in Switzerland. I am from Germany and commute daily across the border for work. I am unsure about what happens to my salary when working as a cross-border commuter. I have heard that my salary is taxed in Switzerland, but I am not sure if I also have to pay taxes in Germany.
Currently, I have been working as a cross-border commuter for several months but have not received precise information on how my salary will be taxed. I am concerned that I may be double taxed or have tax disadvantages when working as a cross-border commuter.
Could you please explain to me how my salary as a cross-border commuter is taxed and whether I still have to pay taxes in Germany? Are there any ways to take advantage of tax benefits or avoid potential double taxation? I would greatly appreciate your helpful information and advice.
Thank you in advance.
Sincerely,
Felix König
Dear Mr. King,
Thank you for your inquiry regarding the taxation of your salary as a cross-border commuter in Switzerland. As a tax advisor with experience in the field of cross-border commuter issues, I am happy to assist you and provide you with the most important information on this topic.
As a cross-border commuter working in Switzerland, you are generally subject to taxation in Switzerland. This means that your salary will be taxed by your employer in Switzerland. Therefore, you will have to pay income tax in Switzerland. Typically, your employer will deduct the taxes directly from your salary and remit them to the tax authorities in Switzerland.
As a cross-border commuter in Germany, you usually do not have to pay income tax because the double taxation agreement between Germany and Switzerland stipulates that income is only taxed in one of the two countries. This means that you are exempt from income tax in Germany as long as you work as a cross-border commuter in Switzerland and pay taxes on your income there.
To avoid double taxation and take advantage of tax benefits, it is important that you are familiar with all relevant regulations and laws and act accordingly. Therefore, it is advisable to consult a tax advisor who is knowledgeable about cross-border commuter issues and can assist you with tax optimization.
There are also various ways to benefit from tax advantages as a cross-border commuter, such as the possibility to deduct certain expenses for tax purposes or to benefit from tax relief in Switzerland. An experienced tax advisor can help you identify and make the most of these opportunities.
Overall, it is important that you inform yourself early on about your tax obligations and rights as a cross-border commuter and, if necessary, seek professional support to avoid tax disadvantages and optimize your tax situation.
I hope this information was helpful to you and I am happy to answer any further questions you may have.
Best regards,
Paula Bauer
