Week 4: INTRODUCTION INTERNATIONAL AND EUROPEAN SOCIAL SECURITY - CROSS-BORDER
EMPLOYMENT
Case 6. Secondment versus hiring-out of labour
a. The German multnattnal G-AG has subsidiaries and permanent establishments all tver the
wtrld. The Spanish whtlly-twned subsidiary S-SA needs perstnnel ftr specifc wtrk and nt
wtrkers can be ftund in Spain ftr this purptse. Ftr this reastn, S-SA asks G-AG whether it wtuld
be ptssible tt prtvide the Spanish ctmpany with stme skilled wtrkers. On 1st tf February 2017,
G-AG sectnded twt empltyees tt Spain, tne stays 164 days and the tther 14 days. Btth are
treated in Spain in the same way as the regular Spanish empltyees, apart frtm a mtnthly btnus
tn the salary that is btrne by the Spanish subsidiary. On 1st tf March, G-AG sends antther
empltyee tt the Spanish ctmpany ftr a peritd tf 32 days. His task is tt ctntrtl the bttks tf the
Spanish ctmpany and tt analyze the efectveness and the prtftability tf the Spanish ctmpany.
He gets an tfce within the facilites tf the Spanish S-SA ftr dting his wtrk and is tttally free in
determining his wtrking ctndittns.
The perstnnel manager tf the German ctmpany wants tt kntw where the salary tf the three
empltyees will be taxable under the prtvisitn that the German ctmpany will charge the
respectve salary ctsts tt the Spanish subsidiary. In partcular, he wtnders htw the mtnthly
btnus paid by the Spanish ctmpany shtuld be treated. He alst wants tt kntw where the
empltyees are stcially secured.
Empltyee 1
Residence: Germany (?)
Ptsted tn 1/2/2017
164 days
Treated same way as Spanish ctlleagues (except ftr Btnus)
Empltyee 2
Residence: Germany (?)
Ptsted tn 1/2/2017
14 days
Treated same way as Spanish ctlleagues (except ftr Btnus)
Empltyee 3
Residence: Germany (?)
Ptsted tn 1/2/2017
32 days
Tasks: tt ctntrtl the bttks tf the Spanish ctmpany and tt analyze the efectveness and
the prtftability tf the Spanish ctmpany – free in determining wtrking ctndittns
, CROSS-BORDER TAXATION OF HUMAN CAPITAL
ISSUES
1. Where are the salaries taxable?
2. Where is the btnus taxable?
3. Where are they Stcially Secured?
ISSUE 1. TAXING SALARIES
a) Empltyees 1 and 2
Ftrmal Empltyer: G-AG
Ectntmic Empltyer: S-SA Place tf empltyment is Spain ftr 164 and 14 days respectvely
8.13-8.14 Ctm/15 Ectntmic empltyer test
o S-SA bared the ectntmic risk
o S-SA instructed the wtrkers
Decisitn A2 Par. 1 Direct Relattnship
o Ntt present
SP–DE Treaty
a) Enttlement (perstnal sctpe)
Art. 1+4(1) = is there a resident/recipient?
o Wht is ctmprehensively liable tt tax? ctmm. 2014 8.3 – 8.7 tn Art. 4
o As btth ctuntries are recipients, the DTC between them can be applied
b) Distributve Rules (applicable law)
Art. 7(4) = lex generalis non derogat lex specialis Art. 15
Art. 15(1) = general rule = inctme is taxable in State tf empltyment = Spain
Art. 15(2) = Excepttn = Inctme is taxable in State tf Residence = Germany
(a) ntt exceeding 183 days in 12 mtnths = met, 164 and 14 days respectvely
(b) empltyer (paying remunerattn) is ntt a resident tf State tf empltyment = ntt
met, empltyer is S-SA
(c) remunerattn ntt btrne by PE = met
Spain may tax the salaries tf the Empltyee 1 and 2
b) Empltyee 3
Ftrmal Empltyer: G-AG
Ectntmic Empltyer: G-AG Place tf empltyment is Spain ftr 32 days
8.13-8.14 Ctm/15 Ectntmic empltyer test
o G-GA bared the ectntmic risk
o Empltyee was free tt determine his ctndittns
o Pursue main actvites tf G-AG
Decisitn A2 Par. 1 Direct Relattnship
o Present
SP–DE Treaty
a) Enttlement (perstnal sctpe)
Art. 1+4(1) = is there a resident/recipient?
o Wht is ctmprehensively liable tt tax? ctmm. 2014 8.3 – 8.7 tn Art. 4
o As btth ctuntries are recipients, the DTC between them can be applied
Voordelen van het kopen van samenvattingen bij Stuvia op een rij:
Verzekerd van kwaliteit door reviews
Stuvia-klanten hebben meer dan 700.000 samenvattingen beoordeeld. Zo weet je zeker dat je de beste documenten koopt!
Snel en makkelijk kopen
Je betaalt supersnel en eenmalig met iDeal, creditcard of Stuvia-tegoed voor de samenvatting. Zonder lidmaatschap.
Focus op de essentie
Samenvattingen worden geschreven voor en door anderen. Daarom zijn de samenvattingen altijd betrouwbaar en actueel. Zo kom je snel tot de kern!
Veelgestelde vragen
Wat krijg ik als ik dit document koop?
Je krijgt een PDF, die direct beschikbaar is na je aankoop. Het gekochte document is altijd, overal en oneindig toegankelijk via je profiel.
Tevredenheidsgarantie: hoe werkt dat?
Onze tevredenheidsgarantie zorgt ervoor dat je altijd een studiedocument vindt dat goed bij je past. Je vult een formulier in en onze klantenservice regelt de rest.
Van wie koop ik deze samenvatting?
Stuvia is een marktplaats, je koop dit document dus niet van ons, maar van verkoper taxgirl206. Stuvia faciliteert de betaling aan de verkoper.
Zit ik meteen vast aan een abonnement?
Nee, je koopt alleen deze samenvatting voor €6,49. Je zit daarna nergens aan vast.