The rise in working from home, throughout and since the COVID-19 pandemic, has already sparked a large shift in how the majority of employers manage their employees. With the challenge of resource and recruitment, working from home is now seen as an essential benefit for many people looking for jobs.

Now as we are learning, many employers and their employees who work from home in a different country to their employer, are unaware of the implications of international working from home.

What do employees need to consider for international working from home?

The three main considerations are tax, social security, and payroll, and from an international working from home perspective, it's trying to fit a new way of working into old tax laws, both in the UK and wherever the employee is working.

In some scenarios, employers find out that their employees are working from home, whilst living abroad, after the event, and many employers haven’t included policies around this in employment contracts.

Furthermore, some employers have offered international working from home to their employees, perhaps without understanding the implications first, and are now in a situation where their employees are happy with that arrangement and they’re at risk of losing staff if they make changes

In addition, self-employed people need to consider the implications of moving abroad because where they are registered and where the activity is taking place is key to avoiding any confusion over tax implications.

What happens if employers don’t comply?

Failure to comply with the tax, social security and payroll legislation can lead to investigations and penalties in both countries. Rectifying these issues comes at a significant cost, and although the sizeable rise in working from home whilst living abroad is fairly recent, employers should not expect any leniency from the tax authorities.

To read the full article, and find out more about what you should do to ensure your organisation is compliant, you can click the link here.