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A day is a day unless it’s split in two: the Dutch Supreme Court clarifies travel-day income sourcing
Matthew Chin Barnes Subject Matter Expert – Tolley’s Global Mobility: Employment Taxes, LexisNexis, explains how a recent Dutch Supreme Court decision aims to simplify travel-day income sourcing, and why UK payroll professionals need to rely on clear guidance when applying treaty rules across borders
A January 2025 Dutch Supreme Court ruling applied a 50 / 50 travel-day split for sourcing employment income under Article 15(1) of the Netherlands-Saudi Arabia tax treaty. The judgment illustrates how tax treaty interpretation can vary and how something as routine as counting workdays becomes complex in a cross-border setting. Counting days is never ‘just counting days’ Is a day spent flying to a work location taxable in the country of departure or arrival? Should it be split between both? What do double tax treaties have to say about it? Allocating a day’s pay to the correct country can be surprisingly complex. A single business trip can span multiple jurisdictions, time zones and reporting systems. Yet every workday must be sourced somewhere, and mistakes can trigger double taxation, incorrect treaty relief or compliance failures. These were the issues before the Dutch Supreme Court (the Hoge Raad). You can read the judgment here: https://ow.ly/ qUlL50WmPQF. Case in focus The case concerned a Dutch tax resident employed as a goalkeeper coach by the Saudi Arabian Football Federation. His role involved significant travel, including international flights accompanying the national football team to Iraq and Jordan for matches in 2018. The issue before the Dutch Supreme
Court was whether the days (three of them) spent travelling to and from those matches should count as Saudi workdays for the purpose of allocating taxing rights under Article 15(1) of the Netherlands-Saudi Arabia double tax treaty. Article 15(1) can be found here: https://ow.ly/LJjv50WmPTW. The article in question in principle follows the Organisation for Economic Co-operation and Development (OECD) Model. You can find out more here: https://ow.ly/ zmyx50WmPWV. Under Article 15(1), taxing rights over employment income generally rest with the country where the work is physically performed. However, under Article 15(2), the home country retains taxing rights if the employee is present in the work country for fewer than 183 days (this rule involves its own method of counting, more on this below), is paid by or on behalf of a non- resident employer and the remuneration is not borne by a permanent establishment that employer has in the work country. Focussing on the three travel days, the Dutch tax authorities, including the court of first instance, allocated half a day to Saudi Arabia for each one. The taxpayer appealed, holding that each day should count in full, resulting in more of his income being exempt from Dutch tax. The Court of Appeal (CoA) (https://ow.ly/ Zqij50WQvmY) sided with the taxpayer, holding that travel to or from the employer’s country should be treated as a full workday in that jurisdiction. The CoA relied on previous Supreme Court case law that
emphasised full-day units, taking the view that such travel was effectively an extension of regular duties carried out for the employer. The Supreme Court (armed with a detailed opinion from the Dutch Advocate General) disagreed, rejecting the CoA’s approach. The Supreme Court agreed that travel is part of performing employment duties. A travel day, even if passive, connects directly to the job. But sourcing the full day to either end of the journey would misrepresent where work occurred and risk gaps in taxation. Since the treaty and OECD commentary offered no clear direction, the Court opted for a simple, balanced approach: a 50 / 50 split between departure and arrival countries. This applied even when no work was done beyond travelling. Stopovers and time in transit were ignored, emphasising the focus on the two endpoints. For more on Dutch employment tax issues related to globally mobile employees, see Tolley’s Global Mobility Employment Taxes, Netherlands: https://ow.ly/Y76850WBUtN * .
UK travel-day logic: a more nuanced model
UK payroll professionals are no strangers to HM Revenue and Customs’ (HMRC’s) split-day thinking. However, HMRC applies a more situational approach rather than a blanket rule, as there are no statutorily mandated tests for determining travel-day allocation. Instead, according to EIM77020 (https://
| Professional in Payroll, Pensions and Reward | September 2025 | Issue 113 26
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