CONVINUS Global Mobility Insights NEWSLETTER Herbst / Fall 2022

Global Mobility Insights - Herbst / Fall 2022
tion of 20% of the remuneration
for the provision of services must
be taken into account, in
particular in cases of virtual
secondment to Austria.
In this case, the Romanian group
company could, under certain
circumstances, establish a
permanent establishment in the
country of residence and
employment (in this case Austria)
if that country follows the
concept of an economic employer
and the group company in
Romania is to be regarded as the
economic employer due to the
transfer of personnel costs (the
employee is therefore
economically attributable to the
Romanian company). The
establishment of a permanent
establishment by the employer in
Romania is excluded due to the
fact that the employee does not
reside predominantly in Romania,
or if the situation is to be
regarded as assignment of
employees (personnel leasing), no
permanent establishment would
be established, because according
to the prevailing view, the
establishment of a permanent
establishment is excluded in such
cases.
Social security contributions are
continuously to be paid by the
employer in the country of
employment (Austria).
4) Workation:
Employee in country X has an
employment contract with an
employer in country X. The employee
temporarily relocates to country Y
and continues to work from there for
the employer in country X. Country X
is almost always a vacation
destination.
Example: Employee of an Austrian
company, residing in Austria,
performs work from a Greek island for
3 weeks.
Tax and social security consequences:
Whether an income tax liability
arises in the "vacation country"
depends on whether the residence
was maintained in country X
(Austria) as well as whether a DTA
exists between country X (Austria)
and the vacation country (Greece)
and how long the employee stays
in the vacation country. If the
employee gives up his residence in
country X (Austria), no DTA would
be applicable and the DTA
protection against possible
double taxation would cease to
apply. That means, in the non-DTA
case, double taxation of the
employee's income could occur. If
a DTA is applied, a tax liability
would arise in the vacation
country if the employee stays
there for more than 183 days in a
calendar year or in a 12-month
period.
30 convinus.com