The holding of a director’s title is not yet a director within the meaning of the tax treaty.
The distribution of tax duties is often different whether a person is an “ordinary” employee or statutory director/commissioner.
According to the Court of The Hague, a double test applies to the interpretation of the concept of director from the tax treaty with Luxembourg. A formal test and a material test. The driver must be a statutory, formal, driver. And he actually has to do driver work.
A man lived in the Netherlands and was ‘director of legal & compliance’ in employment at a Luxembourg company. This company was part of a group of financial institutions. The man also indirectly had a 5% stake in the Luxembourg company. In 2013, the man worked on average two days a week in Luxembourg and one and a half days a week at home. The work in the Netherlands concerned administrative activities for the Luxembourg company.