October 1st update on the tax and social security situation of cross-border teleworkers

As of October 1st, 2021, the tax and social security situations of German, Belgian and French border workers with a Luxembourg employment contract and working from home are as follows

From a fiscal point of view:

• Germany and Luxembourg automatically renew the agreement (unless one of these two countries denounces it) on the immunization of the number of telework days. In normal periods, the quota not to be exceeded is fixed at 19 days.
• Belgium and Luxembourg have decided to immunize until December 31, 2021, the number of 24 days (on January 1, 2022, this number will increase to 34) which is the quota not to be exceeded in order not to be taxed in Belgium. The Belgian employee can continue to telework without the risk of being taxed in his country of residence, whatever the number of days in home office.
  “From 2022, the 49,000 or so Belgian border workers will be able to telework 34 days instead of 24 without changing their tax regime“.
• France and Luxembourg have decided to immunize until September 30, 2021, the number of 29 days which is the quota not to be exceeded in order not to be taxed in France. The French employee can continue to telework without risking to be taxed in his country of residence, whatever the number of days in home office.

From a social security point of viewIn normal times, European legislation provides that if an employee works more than 25% of his working time outside the country of his employment contract, he changes his social security assignment back to that of his country of residence.

• As of June 29, 2021, Germany and Luxembourg have extended the bilateral agreement not to take into account teleworking days until December 31, 2021, not to take into account "teleworking days related to the Covid-19 crisis for the determination of the social security legislation applicable to frontier workers".
• As of June 11, 2021, Belgium and Luxembourg have extended the bilateral agreement until December 31, 2021, not to take into account "the days of teleworking related to the Covid-19 crisis for the determination of the social security legislation applicable to frontier workers".
• As of September 1, 2021, France and Luxembourg have also extended the agreement not to take into account telework days until November 15, 2021, the date of "the end of the state of health emergency in France," according to the Ministry of Social Security's press release issued on September 1, 2021.