Belgium has concluded so-called COVID-19 agreements with Germany, France, Luxembourg and the Netherlands on the tax impact of international travel restrictions and health instructions (“work at home”) for cross-border workers and their employers. These agreements have now been extended until, at least, 31 March 2022.

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COVID-19 Agreement with Germany

The Belgian and German authorities concluded a COVID-19 Agreement on 6 May 2020. The initial period of application was already extended several times. A new agreement dated 17 December 2021 has been concluded to extend the application of the Belgian-German COVID-19 Agreement up to (and included) 31 March 2022.

COVID-19 Agreement with France

On 15 May 2020, the Belgian authorities and their French counterparts concluded a COVID-19 Agreement which has been extended several times. With the new agreement dated 6 December 2021, the application of the Belgian-French COVID-19 Agreement is now extended up to at least 31 March 2022 (and, in principle, automatically extended until 30 June 2022 unless agreed otherwise).

Moreover, as previously indicated, the Belgian-French COVID-19 Agreement also allowed French frontier workers (within the meaning of paragraph 7 of the Additional Protocol on Frontier Workers) to work from their home (in France) without such days being considered as days performed ‘outside the Belgian frontier zone’, hence not triggering the loss of the frontier regime. The agreement of 6 December 2021 also extends the COVID-19 Agreement on this aspect as well.

COVID-19 Agreement with Luxembourg

On 19 May 2020, the Belgian and Luxemburg authorities concluded a COVID-19 Agreement which has been further extended several times. The agreement has been extended again up till at least 31 March 2022 with an automatic extension until 30 June 2022 unless agreed otherwise (agreement concluded on 9 December 2021).

COVID-19 Agreement with the Netherlands

Belgium and the Netherlands concluded a COVID-19 Agreement on 30 April 2020. The period of application of this Agreement was extended several times. Since the new agreement concluded dated 10 December 2021, the application of the COVID-19 Agreement has now been extended at least until 31 March 2022 (and will be, in principle, automatically extended until 30 June 2022 unless agreed otherwise).

What happens after 31 March 2022?

As explained in our previous article, the idea behind the COVID-19 Agreements lies in the fiction that salaried workers are deemed to have worked in the country where they would normally have worked on the basis of their contractual obligations, despite the fact that due to travel restrictions the employee was working from home. However, this fiction does not apply to secondments and days on which the employee was already allowed to work from home (based on the employment agreement) prior to the travel restrictions due to COVID-19.

However, this fiction strictly applies as long as the COVID-19 Agreements apply. If the employer decides to continue to apply travel restrictions after these agreements have expired (31 March 2022 or 30 June 2022 if automatically extended), normal application of the respective double tax treaties apply again. Hence, a Belgian tax resident working from home, even though he was supposed to work (e.g.) in France, income relating to these days will be taxable in Belgium.