Remote working from abroad ? Yes or No?

Our new work routine: Remote working management.
More and more client companies need and agree to accommodate their employees wish to work from abroad on a long term basis.
The corporate world and the employees have discovered during COVID19 and thanks to technology that working from outside the office and outside of the country works equally well.

So we have set-up employments and payrolls of non resident employers in Canada, Singapore, Belgium, Spain, France, Austria ... to name a few.

Although we are handling this routinely, it remains a complex question at the cross roads of personal income taxation, corporate taxation, social security contributions, employment regulation and insurances. Yet it is only a process to follow, and it starts with a decision process, at the end of which the employer will discover that this is a money saving opportunity or will decide that retaining a valuable employee is worth the extra cost, or not.

While long term working from abroad has now become manageable for employers, and more and more businesses are implementing it, what about short term working from abroad?

Revolut has recently declared that any employee might work from abroad for up to 2 months per year. Whereas some other employers have decided to ban it altogether.

If employees can work from home for 5 months during a lockdown without any loss of productivity, why could they not successfully do the same from abroad for some weeks every year? And if employees can work from abroad on a 2 week business trip why would that be a problem if they are working from abroad but are not technically on a business trip ?

Let's look at what it takes to send an employee on a business trip (BT) or work from abroad (WFA):

• Social security: Must check social security agreement, if in place ask for certificate of coverage, if not check regulations and their implications. Same for both BT and WFA
• Corporate taxation: Irrelevant for BT and WFA if short term, i.e. just a couple of months.
• Personal tax: Can create some liability for both BT and WFA even on a short term
• Employment regulation: Too short term to have an impact on both BT and WFA?
• Insurances: Need to investigate if policies treat work from abroad differently to business trips

It seems a company like Revolut has picked-up on an important fact, which is that short periods of working from abroad will cause no additional administrative burden than business trips do but will add attractiveness to working in their organisation. Clearly the above listed matters that might have been previously disregarded as low risk are now actively being debated as companies are keenly trying to figure out the right approach to this new trend.

What is your company doing?

This article does not constitute in anyway a legal opinion. Please always consult an expert adviser.