By now, we all know that getting back to “normal” will, for many people, not involve going back to work in the way we did before Covid-19 hit.
Remote Work: Tailored for the Lucky & the Reluctant
When folks start chatting about the future of work, terms like “remote working,” “agile working,” and “flexible working” pop up almost like family members swapping names at a reunion. But it turns out remote work isn’t one-size-fits-all—it can be a full‑time flextime for some, and a part‑time side gig for others.
Why Some Employees’re Losin’ the Map to Their Desk
- They’ve taken advantage of the “work from home” loophole, packing up and heading back to their homeland.
- Some have elected to follow their hearts—and family—moving to care for elderly relatives in foreign lands.
- And, let’s not forget the retirees who’ve swapped their 9‑to‑5 for sun‑soaked retirees in warmer climes, even if only for a semester.
Tax Talk: The Part of the Story Most People Skip
It’s all fun and games until the taxman shows up, right? For those globe‑trotters and “home‑only” workers, taking early advice on how to keep their taxes in line is absolutely vital. An ill‑timed move can turn a sweet escape into a tax travesty.
Quick Fix Tips
- Know your home country’s rules. Some places require you to declare worldwide income even when you’re physically away.
- Register an address. This helps the tax office identify where you’re based and when you qualify for double‑taxation agreements.
- Track your work hours. If you split your time between two countries, make sure your clock runs on the right currency.
Bottom line: You can enjoy remote, agile, or flexible work—just make sure the rules aren’t ticking back on you. And if you’re moving in any direction, keep those tax fields fresh, or you might end up with a “debt” that’s hard to swallow.
Where will the tax be paid?
When and Where Do Taxes Drop Into Your Pocket?
Picture this: your employee hops onto a plane, lands in a new country, and starts earning there. Where does that money end up paying taxes? The answer isn’t tarot card simple—it hinges mainly on the employee’s tax residency status.
The 183-Day Rule: Your Quick and dirty Decision Tool
Remember, most tax systems use the “183‑day rule” to decide if someone is a resident for tax purposes. In plain English:
- Out for longer than 183 days → you’re likely considered a tax resident in that country.
- Under 183 days → you might still be a UK tax resident but you’ll need to check the finer details.
If the 183‑day dance is completed, the employee will usually owe taxes in the country where they’ve made that 183‑day mark.
Double Trouble? Not Exactly
Now, what if your employee lands in the new country but hasn’t hit the 183‑day milestone yet? The temptation is to guess they’re safe from double taxation. It’s not that simple.
In that window, the crew needs to:
- Identify if the income gets taxed by the UK and the foreign country simultaneously.
- Check whether the UK obligations still apply.
- Look into any double tax treaties that might shrink the overlap.
These treaties usually give one country the “first dibs” on taxation. But you can’t just assume—dig in and confirm which country gets the priority.
Bottom Line for Employers
- Always verify if your employee’s tax residency status triggers a tax bill overseas.
- Keep holding UK taxes until you’re certain no double filing is possible.
- Talk to the treaty experts. A well‑used treaty can save you and your employee from paying about the same income twice.
Remember, the world of taxes is less like a straight line and more like a maze—just move through it with the right map (or treaty) in hand!
Who will pay the tax?
When Your Employee Goes Global: Tax Tips That Don’t Slip You Off the Edge
Going abroad with a staff member might feel like a trip to any destination, but taxes switch the scenery into something that can bite hard. Before packing those passports, get this straight: the rules of the host country can drag both you and the employee into tax soup.
Who Pays the Tax Bills? Employer vs. Employee
- Employer’s Task: In many places, the company must register itself locally to handle social security and income taxes for the overseas worker.
- Employee’s Load: Some jurisdictions let the employee shoulder the bulk of the tax responsibility—no company paperwork, but hefty personal bills.
- Action Required: Draw up a local adviser. Know the exact split of duties so a surprise tax storm doesn’t catch you and your employee when you least expect it.
Why an Employee’s Job Might Set Up a Tax Office for Your Company
- Contracting Magic: If your remote person has the power to negotiate deals or sign contracts that enforce your brand in that country, your company can suddenly become a taxable entity there.
- Business Taxes & More: This local presence means paying business taxes, possibly dropping you into licensing hoops and bureaucratic e‑forms.
- Unintended Liability: Should your firm want to dodge those extra obligations, the decision to send an employee overseas can hit hard—and suddenly you’re not just firing a clocked‑in worker, you’re officially a business in a new jurisdiction.
Should You Move an Employee Abroad? A Quick Checklist
- Check the registration rules of the foreign country.
- Ask a local tax consultant to map out the division of responsibilities.
- Determine if the employee’s tasks will create a tax presence for your organization.
- Weigh the cost of licensing and paperwork against the benefits of an overseas office.
- Decide: do you want your company to become an accidental tax victim or keep the operation strictly in the homeland?
In short, if you’re planning to have your employee get out of the office and into a foreign market, think of taxes like a surprise party—unless you coordinate with the right advisers, you might find yourself under an unplanned spotlight.
Take stock and resolve any issues now
Oops, the Tax Machine Keeps Turning
Even if nobody intended to stir up a tax storm or set up a tax presence in another country, it can happen if remote workers pop up where the laws expect you to register.
- Pause and peek: Make sure the tax rules and work arrangements actually line up.
- Check the glue: Verify everything is working as it should.
- Unwind if needed: If a taxable presence creeps in, it’s time to roll back the remote set‑up – as smoothly as a drone collecting its battery.
It’s all about keeping the team humming without the unwanted tax consequences.