GTN Mobility Tax Blog

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.

As companies adjust to the new reality of work and reassess their mobility programs, there is an opportunity for them to examine the costs associated with running their mobility programs and explore innovative solutions. We are witnessing a renewed interest in mobility as companies seek to adopt the best structure for their business and employees. While non-traditional forms such as remote and hybrid work are becoming more prevalent, there is also renewed interest in both short and long-term assignments. 

Tax equalization is a policy widely used by companies with mobile employees. At its core, tax equalization is a mechanism to ensure that an employee is neither better nor worse off financially, from a tax perspective, for having accepted an international assignment. However, there are many misconceptions about what exactly it means to be “tax equalized.” As one example, some companies will try to avoid the policy because they think it will automatically lead to high company costs and administration.

As pandemic-era restrictions have lifted, there is little doubt that 2022 has been an exciting, return-to-almost-normal year for the world of global mobility. Companies are embracing this new normal, and employees are increasingly on the move as mobile work picks up momentum and businesses resume corporate travel. In fact, according to our Future of Mobility Survey conducted earlier this year, over 95% of companies have some sort of mobile workforce—be it remote workers, hybrid workers, commuters, or business travelers. And with this uptick in mobile workforces comes an increase in tax and compliance risks that companies must consider.

To keep your mobility program running smoothly, our team of experts have created an abundance of mobility tax resources for your use. Here are the top 10 most popular resources from 2022 to date. Whether you have an established mobility program, are considering new international growth, or have seen an uptick in your remote workforce, there’s a resource in this list for you.

As remote work requests continue to roll in and the future of work is one that embraces a mobile workforce, C-suite executives are pushing to offer remote work as a valuable incentive to retain and attract talent. While a drive to offer this employee incentive has already realized advantages for companies, it has also come with many challenges and compliance requirements that still need to be addressed.