Covid-19 is having far-reaching effects on how and where work gets done. The massive shift towards globally distributed and remote work is likely to persist long after Covid-19 stops being a pandemic. Debra Partridge of TOPIA explains.


o protect workers, recoup lost tax revenues and offset public expenses relating to Covid-19, governments around the world are mandating more transparency and placing

further scrutiny on businesses. With this heightened government focus, it is essential for organisations accurately to report business activity by all their representatives and in all domains to authorities. To stay ahead of this potential compliance

nightmare, HR, finance and payroll teams need a technology solution to help monitor employee location and activity, and therefore ensure safety and regulatory compliance. In this article, we’ll take a look at why modern technology is required to address the challenges of distributed employees in a new and evolving world of work.

HOW IS THE REGULATORY LANDSCAPE CHANGING? The pressure on governments to adjust to new ways of doing business and recoup tax revenue to pay for Covid- protective policies is coming into sharp focus. New legislation concerning the OECD’s BEPS initiatives and GRI revisions will also impact compliance topics, such as Permanent Establishment (PE). Other influences such as Brexit and Posted Workers Directives are driving material changes in business obligations that will result in penalties for non-compliance. These emerging tax regime changes and new regulations require executives to make significant adjustments to their existing business models, enterprise resource planning systems and related business processes. In these challenging times, where many businesses’

revenue is negatively impacted by the pandemic, business leaders need to ensure they are aware of all of their financial obligations and avoid financial penalties from not being compliant. In some cases, the impact can go far beyond financial consequences. Aside from the potential legal implications of wrongful actions, incidents of non- compliance often impact on an organisation’s brand.

OPERATIONAL CHALLENGES WITH DISTRIBUTED WORKFORCES When we speak to organisations, typically the biggest concern and challenge with mobile employees is knowing where those employees are and their business activities. Pre-Covid, employees often needed to travel outside of their home country (Europe) or state (US) for work. Even though there has been a reduction in business travel since the onslaught of Covid-19, we still need to know where employees are. A large portion of the workforce is now distributed and working from home; wherever “home” may be. This makes reporting activities carried out across all these different jurisdictions all the more essential to ensure business compliance. Business leaders and stakeholders are increasingly

aware of the potential risks associated with mobile workforces. Yet, it is tempting to think that current restrictions impacting business travel mean potential risk is lower. However, the reality is that compliance risk is still very much a challenge in the Covid-19 pandemic. In fact, for many organisations with a mobile, highly remote and distributed workforce, the risk is even higher. Business leaders should still be concerned about tax considerations, permanent establishment risk and other regulatory compliance issues when allocating their workforce for remote working. According to a Global Guide to Remote Working

published by DLA Piper, the key risks for employees working abroad include, but are not limited, to: payroll tax risks, permanent establishment tax, “doing business”

“ Covid-19 has shown remote and distributed workforces are a viable way to get work done and are here to stay”


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