Will we return to pre-pandemic working practises?
On the whole working from home has proved successful for many large corporations and smaller businesses, only 1 in 5 CEO’s who were surveyed want to return to normal.
If the ‘work from anywhere’ ethos continues businesses may trigger tax compliance issues:
“It’s not so much about tax planning, it’s more about tax compliance. Because if they’re going to have employees in different locations, those employees can potentially create a permanent establishment for the employer…. Once you’ve established an employee is going to stay in a particular location, you have to consider whether you are required to run a local payroll, also the employee has different entitlements under the local employment law.” Kiki Stannard, managing director at ZEDRA London.
To tackle the arising tax challenges, businesses will need to establish collaboration between various in-house finance, legal, and HR teams, particularly as in-house support functions will be impacted by employees working remotely, according to Stannard.
Businesses need to consider how working-from-home and cross-border working impacts their business.
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