Where to pay taxes if I don't live 6 months in any country?

Question

I am a Spanish citizen working for a Dutch company and I am registered as a resident in Netherlands, where I rent an apartment and pay taxes. Because of my work, I have traveled a lot around the world, spending about 70 days in germany, 70 days in China and only 120 in NL, not consecutive (I mean, I could spend 20 days in China, 10 in Germany and then 8 in NL before starting over again). I am ok with paying taxes in NL and pay them regularly thru my employer. I know that in China, I only have to pay taxes there if I spend more than 180 days in a natural year in the country (which I have not) so I am ok with that. I am not so sure about Germany. Can Germany claim taxes based on this?

Answer 1

It can be incredibly complex and my answer is going to be mostly useless because I don't know the rules for those countries.

But having gone through similar elsewhere, my advise is don't trust the first opinion you get nor the second. You're doing something that's becoming increasingly common but is still at the rare end of the scale, and even some tax accountants get it wrong and give bad advice (because they're only intimately familiar with the rules in their jurisdiction).

At the end of the day it's even possible you're not explicitly required to pay taxes anywhere. But don't worry, tax authorities will see it their business to rewrite reality to make that not true.

Based on renting an apartment in NL, they will almost certainly claim you as their tax resident. As for Germany? Not likely. But don't take my word for it. I'm just some random on the internet.

Answer 2

Here is the relevant German law and a KPMG report describing the rules briefly (from Rob's answer to another related question). The EU also offers (necessarily vague) information on this topic and a list of links to tax treaties between the various member states. There is more than a simple number of days threshold to all this but it seems you would not be a German tax resident under current rules.

Importantly, there is a tax treaty between both countries (there was already another one before that one) and, as far as I can tell, you cannot be considered a resident of both countries at the same time. So, even if you would fall under the German definition of tax residency, your Dutch residency should take precedence (based on your description, it seems to be the country you spent the most time and have the “center of your interests”), which only leaves German-sourced income to worry about.

What counts as German income is defined in this article but I won't venture any guess as to how it applies to your situation or if the treaty makes any difference in this respect. The Dutch Belastingdienst also offers some explanations based on the relevant tax treaties. Note that the rules also depend on your exact status in Germany (posted worker or not). If you want a definite answer, you would probably seek professional advice or at least the opinion of someone more knowledgeable than myself about these questions.