What are the coronavirus effects on your tax situation?

12 February 2021

What are the coronavirus effects on your tax situation?

Update February 2021:

Was your international working and living situation in 2020 different than expected due to the coronavirus? In that case it is important to check what the consequences are for your 2020 tax return. Your physical work location is very important tax-wise and determines where you have to pay income tax. If you unexpectedly worked more days in the Netherlands in 2020 than abroad or the other way around this may have tax consequences.

If the coronavirus and its worldwide measures will also affect your 2021 international situation, there is still time to structure things in such a way that negative tax consequences are minimised.

What situations

The COVID-19 coronavirus has changed a lot for working people in general, but especially if it involves an international job. If you live in the Netherlands and have a job that requires working in several countries your work situation has most likely changed profoundly. This can also have tax implications. Here are some of the situations that you can be in at the moment:

  • you are forced to work at home in the Netherlands and you can no longer work abroad;
  • you can no longer work abroad and you cannot work from home in the Netherlands, but your wages are still paid;
  • or you can no longer work abroad, but you cannot do the work from the Netherlands and you will not be paid any wages, but receive a (temporary) unemployment benefit;
  • you are staying in another country and are performing your work from home there;
  • you may also not be able to work at all because you and / or family members are ill at home due to the coronavirus;

It could also be that you cannot start working (yet) in the Netherlands while you already signed a contract. (You can read more about the coronavirus consequences for your application or stay in the Netherlands on the IND site). Or you cannot start your new job abroad because you cannot leave the country (yet).

All these situations will have tax consequences because tax will be levied in another country than normal / expected. Are you in a situation like the ones mentioned above and do you want to know what this will have for tax consequences or how you can take this into account? Please contact us and submit your situation to us.