As discussed in a recent blog post, the Inland Revenue Authority of Singapore (“IRAS”) has been issuing guidance on the impact of COVID-19 on transfer pricing issues. This week, IRAS issued new forward-looking guidance on (i) the tax residency status of companies and (ii) permanent establishments. This guidance is temporary and applies for the 2021 tax year.
Continue Reading Singapore Issues New Guidance on Tax Residency & Permanent Establishments
COVID-19 has sparked a seismic change in the workplace as many companies have found that working from home (“WFH”) has not diminished employee productivity and that employees prefer its greater flexibility. Given that—and the potential for saving on overhead costs—many companies have announced plans to adopt long-term WFH policies and close or realign office space. The OECD and several countries including the US, UK, Ireland, and Australia have issued guidance that excepts employees temporarily dislocated outside their employer’s country from creating unintended permanent establishments (“PE”)—but long-term WFH employees are not similarly excepted. The US, in particular, has thus far only officially extended PE protection for temporary dislocations of up to 60 calendar days that begin within the emergency period of February 1, 2020 through April 1, 2020.
While many employees that WFH do so from the same country as their employer, that is not always true, and so companies would be wise to perform their due diligence. To that end, this post analyzes some PE issues that a company should consider before it adopts a long-term WFH policy.Continue Reading Work-From-Home Policies in the Post-COVID Era