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Working abroad as civil servant

Updated : 12/2012

Taxes

There is no EU-wide law that says how civil servants who are nationals of one EU country who live and work in other EU country are to be taxed on income earned in either country.

There are only national laws and double tax agreements between countries, and the agreements do not cover all eventualities and vary considerably. However, the basic principles that apply in most cases are given below.

Sources you should check

  • the double tax agreement between the 2 countries involved — to see how you will be taxed.
  • the applicable agreement on diplomatic/consular privileges and immunities — to find out if, as a civil servant, you are entitled to any tax privileges in the country where you work.
  • The local tax office
  • European employment advisers can generally also provide basic information on rules and tax authorities in your new country

Income tax on your earnings

If you are seconded to work abroad as a civil servant, in most cases the following conditions apply (unless the double taxation agreement with that country specifies otherwise):

  • you will continue to pay income tax on your civil servant job income only in the country that seconds (employs) you
  • you will only pay income tax in your country of work if you are a resident there and
    — you are a national of that country or
    — your move there was not solely for the purpose of working as a civil servant (for example you were already living there before being recruited as civil servant).

Civil servant and cross-border commuter?

You are a civil servant of one country but live in another country and commute daily to your work.

You should normally pay income tax on your earnings as a civil servant only in the country that employs you. The concrete terms and conditions for your global income depend on the applicable double tax agreement and the internal laws of the countries concerned.

Example

You are a national of country A but were already living in country B when you were recruited by the country A embassy to work there as a civil servant.

In this case, you would pay taxes only in country B — because you were recruited there, while resident.

Later, you decide to move with your family to country C and commute daily from there to your job in country B.

After moving to country C, you would pay your taxes again to country A — because you would no longer be resident in country B (where you were recruited), nor would you be working as a civil servant in country C.

Sample story

Get to know where should you pay taxes as a civil servant

Kamil from Romania moved to Rome to join his girlfriend who worked there. He applied for jobs locally and finally got a position as secretary in the Romanian embassy.

Because he had become an employee of the Romanian government, his income from this job was taxed in Romania. However, Italy also required him to pay tax.

Kamil contacted an Italian tax office, which confirmed that he should indeed pay tax in Italy rather than Romania — because he hadn't moved to Italy expressly to work there as a civil servant but only found this job once already living there.

As a result, Kamil was able to claim his tax back from Romania and only paid tax in Italy.

This is only a summary of the most common rules.

There could be exceptions under some international tax conventions, and each country has its own definition of "tax resident".

If you've been seconded abroad, you are advised to seek additional information. You can ask your tax office. European employment advisers can generally also provide basic information on rules and tax authorities in your new country.

For more information on income tax, contact details for tax authorities and definitions of resident for tax purposes in each EU country:

Other taxes

For information about other taxes — such as local taxes or taxes on other kinds of income, property, gifts or inheritance — you can contact the tax office in your new country.

Equal treatment

Even if you've been seconded abroad, you'll be treated like a resident in the country that pays your salary. This is the case if:

  • your salary as a civil servant is almost the entire income of your household and
  • you do not receive any other income in the country of secondment high enough to be taxed there.

Sample story

Caetano works as a Portuguese civil servant in Luxembourg and pays income tax in Portugal. The Portuguese tax authorities do not allow him to include in his tax return a deduction for mortgage interest that is available to residents of Portugal. Their grounds for refusal are that his apartment is not in Portugal

Under EU law, the Portuguese tax authorities are required to allow Caetano this deduction — if he would be entitled to it for an apartment in Portugal.

Caetano should get personal advice on how to remedy this discrimination.

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