Moving from country A to country B in EU

[European]

Imagine this scenario with countries A and B both in the EU:

You have been a tax resident in country A for a few years, have bank accounts there. Sometime early in 2023, let's say March, you move to country B, register there, deregister in country A and inform A you are leaving and moving your tax residency to B.

Now say by June 2023 you are already operating normally as a freelance in country B and get a substantial payment in one of your accounts in A for work. You do not declare this as income in B. When in 2024 you file your tax return for 2023 in country B, you declare your bank accounts in A, stating the balance at the end of 2023 (or the current one at that point in 2024).

What kind of checks is B likely to do for your accounts in A when you declare them in 2024?

Will B ask to see the transactions in 2023? How does this usually work?

 

[Martin Everson]

Now say by June 2023 you are already operating normally as a freelance in country B and get a substantial payment in one of your accounts in A for work. You do not declare this as income in B. When in 2024 you file your tax return for 2023 in country B, you declare your bank accounts in A, stating the balance at the end of 2023 (or the current one at that point in 2024).

Have you updated your account address in country A to country B in 2023? If so CRS would report to country B also for 2023.

What kind of checks is B likely to do for your accounts in A when you declare them in 2024?

None unless country B receive information in 2024 from country A via CRS that contradicts your declaration.

Will B ask to see the transactions in 2023? How does this usually work?

Usually not unless they audit you. They will have ability to get that data anyway via current TIEA agreements in place.

 

[European]

Have you updated your account address in country A to country B in 2023? If so CRS would report to country B also for 2023.

Thanks
Would that make a difference? Even if you do not, if you inform as we said the tax authority in country A that you are moving to B and banks in A report to TA in A, TA in A will report to B, right?

 

[Martin Everson]

Thanks
Would that make a difference? Even if you do not, if you inform as we said the tax authority in country A that you are moving to B and banks in A report to TA in A, TA in A will report to B, right?

Yes it would make a difference. If you did not update your address in country A then nothing will be reported to country B. If you did update it then it will be reported. In most EU countries the tax office does not automatically inform the local banks that you have left the country. But some banks do look at information registers such as electoral registers, credit reference agencies, or other government registers etc to gather data. But your address I am assume would not have changed there but your status maybe and they would contact you anyway if they notice a discrepancy which seems highly unlikely.

In any case why bother and just do things the right way.