GTN Mobility Tax Blog

In today's global economy, business travel is an essential part of the job for many individuals. Employees regularly cross borders to attend conferences, meet clients, explore investments, and more. For employers, managing the tax compliance needs of their business travelers can be complex as each country has unique requirements that must be understood and followed.

Tax season can be a challenging time for mobility managers who are responsible for ensuring their globally mobile employees navigate the tax filing processes seamlessly. With complex international tax laws and filings, it's crucial that both employers and employees stay informed and be proactive when it comes to global mobility tax compliance.

Let’s face it, many people find taxes to be intimidating, time consuming, and confusing. Why else would so many people procrastinate when it comes to filing their taxes? Then, add in the intricacies when taxpayers are dealing with multiple tax jurisdictions—due to an international transfer, international assignment, business travel, or even remote work—and the complexities skyrocket. When employees work outside of their Home location, delivering timely communications can go a long way in managing risks and providing an exceptional employee experience—helping you retain top talent and providing essential duty of care to your workforce. Below, we outline key items you should be discussing with your remote workers, business travelers, and/or international transferees or assignees.

In the current global business landscape, it has become increasingly common for companies to offer long-term incentives to their employees as a means of attracting, retaining, and rewarding them. However, while such incentives, including equity income, can be highly effective, they also come with inherent risks that require careful management and oversight.

When a mobile employee relocates across borders, whether internationally or domestically within the US, they soon discover that their tax situation has become far more complex as a result of the move. If that employee is moving from a low-tax location to a high-tax one, they could potentially face a major increase in tax liability. Additionally, they may also encounter tax issues related to the sale or rental of their home, moving expenses for state reporting purposes, state residency issues, and a number of other issues they may not be prepared to handle on their own.

Globalization has transformed employee mobility, expanding it beyond the traditional short- or long-term assignments. Today, a mobile workforce encompasses a range of arrangements, including remote and hybrid work options, as well as short-term business travel. This shift has brought about greater flexibility in terms of how and where employees work, enabling organizations to tap into a wider pool of talent and operate more efficiently in a globalized world. And when employees have greater flexibility as to how and where they work, companies and employees alike must navigate complex reporting and filing requirements to avoid serious financial, legal, and reputational repercussions.