France extends remote working rights for cross-border staff



Luxembourg and France have agreed that cross-border workers will be able to work remotely until 31 March 2021 without double taxation. 

The number of days that cross-border workers from France can work from home is normally capped at 29. After this, they have to pay the difference between their Luxembourg taxes and the rate in France to their local tax office.

Any days worked remotely until 31 March next year won’t be taken into account of this limit, the finance ministry said in a statement on 7 December, explaining that it had requested this exemption.

“While the prospect of an upcoming vaccination is cause for hope, it should not be forgotten that the process will still take some time,” finance minister Pierre Gramegna (DP) said. “We must therefore remain very careful and stay the course in our efforts against the virus.”

Luxembourg has similar taxation agreements with Belgium and Germany, where the number of remote working days is capped at 24 and 19, respectively. Both countries had agreed to lift the cap in 2020 but there is as of yet no news whether they will also extend this rule into the new year.

More than two-thirds of Luxembourg’s workforce set up a home office in the wake of the pandemic, national statistics office Statec said in May. And economy minister Franz Fayot in October issued a plea to employers to allow remote working wherever possible to prevent the spread of the coronavirus at the workplace.

Under EU rules, cross-border employees risk losing their social security affiliation in their country of work if they spend more than 25% of their time working from home. This regulation, too, was scrapped for 2020.

Employer and labour unions together with the government in October signed an updated agreement on teleworking to offer more legal certainty around working from home, also in case of accidents during working hours. But all sides decided not to enshrine the right to remote working into law, leaving it up to employers to allow the practice as they best see fit.