Facilitation for Belgium-Luxembourg cross-border workers


The Belgian and Luxembourg governments had a joint meeting yesterday in Brussels and came to the following agreement with respect to cross-border employment tax situations:

  1. With respect to wages taxes, a tolerance will retroactively (as from 1 January 2015) enter into force regarding the physical presence outside the (usual) country of employment. Concretely, a Belgian resident will be allowed to perform activities outside Luxembourg (the usual country of employment) for a maximum of 25 days without the power of taxation in Luxembourg being challenged (i.e. without being taxed in Belgium) (and vice versa). A mutual agreement and an amendment to article 15 of the double tax treaty concluded between Belgium and Luxembourg will confirm this.
  2. In order to enhance legal certainty, Belgian and Luxembourg tax authorities will publish by April 2015 joint rules regarding tax audit on cross-border workers.
  3. Luxembourg will increase its financial compensation to Belgium in order to finance Belgian municipalities where a significant number of residents perform a professional activity in Luxembourg.