Since the lockdown huge swathes of employees have been obliged to work from home. Some love 1telecommuting; others can’t wait to get back to the office. 2McKinsey and others have published numerous blogs and articles exploring the cultural effects of this sea change in working practice.
What tax implications arise from off shore telecommuting?
There is increased interest from tax authorities as to the jurisdiction of employees and their status. Questions are being asked about the implications arising for employers with regards to their employees tax obligations in a dual tax environment, especially as the short term evolves into the medium to long term. CFOs and Finance Directors need to have a firm grip on the options available to a business under these new and challenging environments.
Questions to be answered include “What is our tax strategy around offshore telecommuting and is it signed off by our Auditors?”
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1Telecommuting , also called remote work, future of work, telework, teleworking, working from home, mobile work, remote job, work from anywhere (WFA), and flexible workplace, is a work arrangement in which employees do not commute or travel (e.g. by bus, bicycle or car, etc.) to a central place of work, such as an office building, warehouse, or store.
1Telecommuting. from https://en.wikipedia.org/wiki/Telecommuting
2Alexander, A., Smet, A., & Mysore, M. (2020, July 07). Reimagining the post pandemic workforce. https://www.mckinsey.com/business-functions/organization/our-insights/reimagining-the-postpandemic-workforce