Tax review of remote working abroad

The UK’s Office for Tax Simplification (OTS) has launched a review looking at the increasing numbers of people choosing to work in different ways, including those working from abroad on remote working holidays.

The review will consider whether the tax and social security rules are flexible enough to cope, and what businesses, advisors and other bodies are experiencing as new ways of working become business as usual.

Some of the key issues the review will cover are:

  • Consider employees normally based in the UK spending time working overseas and overseas employees spending time working in the UK. This includes considering at what the point the UK could/should consider taxing those individuals.
  • Identify ways in which developments in remote working may make complying with the tax system more complicated, and potential considerations for government in policy and operational terms.
  • Identify opportunities these changes may offer to reconsider existing features of the tax system to make things simpler both for those directly affected and more widely.
  • Focus on income tax, national insurance and corporation tax.
  • Allocation of primary taxing rights, and need for double tax relief.
  • Taxation and social security where there are more than two countries involved.
  • Accommodation, travel, and other expenses including consideration of who will be paying for these and the relevant tax treatment. This will include considering whether permanent workplace rules are clear for these new working practices.
  • Short term business visitor rules, overseas workday relief rules and PAYE withholding considerations such as modified payroll.
  • Pension contributions and share schemes.

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