GTN Mobility Tax Blog

Imagine this: you are sitting at your desk working to finalize the weekly status update. In walks the president of the company and says, “In order to increase our business, we are expanding overseas. I would like to send Jane Smith to Germany for three years. How soon can you make this happen?”

I’ll bet the questions that race through your mind are the same as every other HR manager tasked with sending employees internationally for the first time:

• Where do I start?
• What do I need to consider?
• What processes need to be in place?

If your company has tax equalized assignees, you may have heard from employees who received surprise tax bills, held uncollected tax equalization settlements, or were confused on how their tax liabilities were calculated. If any of that sounds familiar, now is the time to revisit the hypothetical tax positions for your mobile employees. Let’s take a look at some of the most common questions we receive and dive into our recommendations on what you can do to ensure a successful mobility program.

The COVID-19 pandemic continues to have a global impact. While we settle into the new “normal” of working anywhere, new questions related to domestic taxation have been uncovered.

Mobility program managers are continuously having to evolve and adapt to new circumstances, and are doing so now more than ever. Additionally, mobility programs and program managers need to remain flexible as COVID-19 continues to impact the world. Both companies and their employees are adapting to this “new world” and finding a new work-life balance while governments are continuing to make decisions to provide economic stimulus and stabilization.

If you have employees working outside the United States who are US citizens or permanent residents (i.e., a green card holder), these individuals will need to continue filing US tax returns to declare all of the income they earn in both the United States and their Host country. This requirement does not change if they are employed or paid from a non-US employer. Additionally, most of the tax rules that apply to taxpayers living in the United States will also apply to US persons operating overseas. The result may be that an overseas employee will be subject to tax in both the US and other jurisdictions.