Remote work is one of COVID-19's enduring legacies. What began as something necessary for health and safety has become a fairly conventional practice.
Remote work is one of COVID-19's enduring legacies. What began as something necessary for health and safety has become a fairly conventional practice. As the O.E.C.D. notes:1
Increasingly, some individuals are able to, and choose to for personal reasons, carry out all or part of their work for an enterprise of a Contracting State from a place in the other Contracting State * * *.
Not surprisingly, the O.E.C.D.'s latest update to its Model Tax Convention on Income and on Capital addresses implications of cross-border remote working.
This article recounts existing guidance on a remote worker's effect on his or her employer and follows with an explanation of the new enhanced guidance.
Permanent Establishment Under Income Tax Treaties
Under the general pattern of income tax treaties, one treaty partner country ("Contracting State 1") may tax the business activities of a resident of the other treaty partner country ("Contracting State 2") if that resident's business activities are derived through a permanent establishment ("P.E.") located in Contracting State 1.2
In broad terms, a P.E. is defined as a fixed place of business through which a business is partly or wholly carried on.3 Typically included as examples are places of management, branches, offices, factories, workshops, and...
As the Department of Justice (DOJ) has established its enforcement priorities over the last year, companies in regulated industries have worked to balance risk and react to the government’s areas o...