In the recent past, German courts had to decide on a case dealing with contributions to the Austrian statutory severance system paid for German-Austrian frontier workers (Art 15 para 6 tax treaty between Austria and Germany). The crucial question was whether the contributions fall within a tax exemption for payments that ensure a safeguarded future for employees provided in the German Income Tax Act. In this article, Christian Knotzer discusses the decisions of the courts in detail and analyzes their consequences for German-Austrian frontier workers.
