FEATURE
the risk . Where a PE / FE is created , the company will have a need to register the company as a taxpayer , file local country returns , and pay corporate and / or VAT ( all in addition to operating payroll for the individual employees themselves ).
Failure to pay such taxes could lead to interest , penalties and other sanctions , such as an increased reputational risk .
Lastly , there are local employment law and immigration requirements to manage . Everything stops when employees are not able to get into the country where their skills are required .
As such , it ’ s essential to remain as vigilant as possible and enlist the help of an expert global mobility partner to mitigate these risks .
They stay up to date with the changing tax landscape
In an ideal world , compliance would be a one-time concern . However , unfortunately , one of the key aspects of compliance is that it is always evolving – in fact , some tax regulation changes are made every year . It ’ s vital to keep up with these rules in all the countries your business operates in . What ’ s more , regulators and tax authorities will expect you to implement these new laws immediately , which means time is of the essence .
Essentially , if your organisation is going to remain tax compliant in each location , you need to be as proactive as possible . Keeping track of such changes is an immense challenge .
This is where it pays to work with global mobility companies , who can help ensure that you stay on top of any changes to existing tax laws and regulations and make sure that your organisation continues to comply .
They can help create tax-effective compensation packages
Another important aspect of implementing a successful global mobility programme is ensuring that your organisation provides tax-effective compensation packages for your employees .
For example , if you are sending employees to a location with a high personal tax rate , such as China , you will need to consider how you will manage the tax impact on those employees by creating a benefits package that offsets the personal tax rate .
This is more complicated than it sounds : there are many considerations involved in creating tax-effective compensation packages , from the possibility of offering tax-equalisation policies to providing other tax-free allowances and ensuring that pay levels remain competitive for the location .
If you are struggling to put together a suitable package , a global mobility partner will be able to advise on all aspects of tax-effective compensation packages and help to create a package that works for everyone involved .
They will help you to strategically plan
Global mobility supports international growth . An effective mobility strategy means :
• Employers can swiftly redeploy specialised talent to priority locations , increasing reactivity and speed to market .
• Employers can offer flexibility on location , providing a competitive advantage in recruitment . Work location is removed as a barrier when hiring key growth talent .
• Employers can onboard talent from new countries faster . This makes it easier to increase local headcount to facilitate growth .
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