EU Free Movement for Cross-Border Work and Living

By Dr. Theresa Rath, Attorney at Law

EU free movement as the basis of a cross-border work and living arrangement

Living in one EU Member State while retaining professional ties to Germany places a person within several legal systems. A self-employed activity for German customers or clients, a business or office in Germany and a home in Italy, Spain or Portugal may be compatible with EU law. Whether a right of residence exists, and on which basis, depends on nationality, the actual place of residence and the way the work is performed.

Free movement law answers the residence question first. Tax residence, social security and professional regulation follow separate rules. A workable arrangement therefore requires each layer to be assessed on its own terms and then coordinated with the others.

My legal advice is limited to German law, including the EU-law rules applicable in Germany. I do not provide tax advice.

Identifying the free movement category that fits the activity

EU law distinguishes between workers, self-employed persons established in another Member State, cross-border service providers and recipients, and economically inactive persons. In remote-work cases, the label used in a contract is not conclusive. The actual work, its genuine economic nature, the place where it is carried out and the person’s integration into an employer’s or their own professional structure all matter.

For self-employed professionals, the distinction may be between permanent establishment in the country of residence and the temporary cross-border provision of services. An employee may live in one country, work for an employer in another and perform duties in several locations. This classification provides the residence-law basis for the rest of the analysis.

The first three months and residence thereafter

EU citizens may generally remain in another Member State for up to three months with a valid identity card or passport. Residence beyond that period requires a continuing basis under free movement law. Workers and self-employed persons rely on genuine economic activity. Economically inactive persons generally need comprehensive health insurance and sufficient resources.

Each Member State determines its own registration and documentary procedures within the EU framework. Anyone moving their centre of life or dividing it between two countries should establish early which registration, certificate or evidence the country of residence requires. My assessment covers the German nexus and the EU-law rules applicable in Germany; local advice is required for another country’s procedures and domestic law.

Facts that shape a cross-border arrangement

Remote work cannot usually be classified by looking at a single address. A German business address may remain in place even where much of the work is performed abroad. Conversely, a foreign residence alone does not establish where the professional activity is actually carried out. Travel days, premises, staff, client contacts and family ties may all affect the analysis.

Family members and third-country nationals

Spouses, registered partners, children and, in certain cases, other relatives may derive residence rights from a mobile EU citizen. This is particularly important where the EU citizen lives with a third-country national family member. Entry, a residence card and evidence of the family relationship may then involve separate procedures.

Where a German national has links to Germany, the applicability of EU free movement law requires separate analysis. A person living only in their own Member State cannot automatically rely on the same rules as an EU citizen who has exercised free movement rights. Return cases and genuine family life previously established in another Member State may be treated differently.

Free movement does not determine tax or social security

An EU right of residence does not automatically determine tax residence or the competent social-security system. Double taxation treaties, national tax rules and EU social-security coordination use their own connecting factors. Where work is performed in several countries, the proportion habitually carried out in the country of residence may be relevant; regulated professions may also involve professional pension schemes.

I do not provide tax advice. As part of a migration-law setup assessment, I can identify the interfaces, organise the relevant facts and, where required, identify and coordinate suitable advisers or other specialists in the countries involved.

A cross-border setup assessment as a separate engagement

The assessment starts with a reliable account of the arrangement: who lives in which country and when, where the work is actually performed, which German professional structure remains in place and which family members are involved. This produces a map of the issues and competent institutions across residence law, social security, tax and professional regulation.

I assess the EU and German migration-law basis, classify the German nexus and identify matters that require foreign or specialist advice. A complex arrangement can then be divided into manageable decisions while preserving the links between them. Advice is available in German, English, Spanish, Italian and Portuguese.