GTN Mobility Tax Blog

Companies that plan to send employees outside of their Home country should first know about the possible tax complexities that may result from the use of an international workforce. Here are five things employers need to know before sending employees abroad.

Our team of mobility tax professionals is always looking to keep organizations updated on industry trends and regulations regarding international employees. In addition to our regularly updated blog, we put a wealth of resources at your fingertips regarding mobility tax, global equity, and business travel—including on-demand webinars, online newsletters, and downloadable guides.

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US citizens and permanent residents working outside the United States generally are still required to file annual US tax returns, and the IRS is constantly updating its technology to better locate those non-filing taxpayers and bring them into compliance. However, in addition to increasing its enforcement capabilities, the IRS has also taken steps to encourage non-filers to come into compliance by waiving penalties for those taxpayers eligible to take advantage of the streamlined offshore compliance procedures.

An employee is likely to see an offer of an international assignment as a vote of confidence from an employer and an opportunity for career advancement. However, there are a number of questions the mobile employee should ask of his or her employer prior to accepting the international assignment, especially when it comes to questions related to regulatory requirements (e.g., immigration, tax compliance) and compensation and benefits issues in both the employee’s Home and Host countries.

It may seem counterintuitive to a US citizen or permanent resident (i.e., a green card holder) who has just taken a new international job, that most will still be required to file US federal income tax returns after relocating. In addition to filing income tax returns, mobile employees may also have other filing obligations including estate or gift tax returns, estimated tax payments, and foreign bank account reports.