[HN Gopher] The legal implications of remote working cross-border
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The legal implications of remote working cross-border
Author : hunglee2
Score : 102 points
Date : 2022-03-12 15:50 UTC (7 hours ago)
(HTM) web link (jessicamayzwaan.medium.com)
(TXT) w3m dump (jessicamayzwaan.medium.com)
| jleyank wrote:
| N American example: Canadian living/working in the US, pay the US
| and state. American living/working in Canada, pay Canada/province
| and US. Trying to work from country A and live in country B adds
| complexity - larger companies probably have a tax nexus, but
| smaller ones might only deal with contractors so they can offload
| the costs/hassle.
|
| And unless you win the lottery, USians in Canada don't have to
| pay the US, really. Just file and summarize your worldwide
| investments.
| jimkleiber wrote:
| I think one of the biggest questions we are facing is how do
| geography-based governments make rules for interactions that
| transcend geographical boundaries?
|
| Whose laws apply when people from multiple jurisdictions interact
| with each other in a digital space? Which law takes precedence? I
| think we see this with property rights, privacy rights, workers'
| rights, business law, tax law, and so much more.
|
| I think web3 may partially be driven by a desire to have a shared
| global system of currency, business registration, property
| registration, and more. For example, registering a DAO is global
| whereas registering a company, in the US, is at a state level.
|
| I feel both afraid and excited at how we will start to more
| collectively govern global spaces.
| mabbo wrote:
| Cross border work burned me so very hard a few years ago.
|
| I live in Canada, but got a position with Amazon where I'd fly
| around the US (and occasionally other countries) to do upgrades
| and launches of Amazon warehouses. Paid in US dollars because I
| was working in the US. A lot of fun, working with some of the
| best co-workers I've ever had. Most Monday mornings, I'd get an
| Uber to YYZ Toronto and fly to some new city and be back by
| Friday night.
|
| Where I got burned was the weeks I did not fly anywhere and
| worked from home doing prep work. I didn't sync correctly with
| payroll and HR that I was doing this work in Canada, which
| implies that the Canada Revenue agency was owed my taxes for
| those days, not the IRS. But the company paid my taxes to the IRS
| since I was a US worker. (To be clear, they had a system to avoid
| this problem but I didn't understand and didn't set it up right).
|
| Come tax time, I owed the CRA $15,000, and the IRS owed me
| $15,000. But there was 3-month long gap between the date to pay
| and the date I'd get my refund. We managed, but yeah that wasn't
| fun at all.
| xwdv wrote:
| How could you have such a lucrative career and somehow not have
| $15k liquid somewhere? You could even just take out a margin
| loan from your brokerage and not liquidate any securities.
| withinboredom wrote:
| In my experience, when the tax man comes calling, it's always
| just after a big move, big purchase, far away death in the
| family, or some other life event where you have less savings
| than normal.
| jupp0r wrote:
| I see lots of potential for a legaltech startup that offers an
| easy way for companies and their employees to not have to deal
| with this and to compute tax implications beforehand.
| nickkell wrote:
| I think this is the reason umbrella companies exist. You
| invoice them and they make the appropriate deductions for tax
| and social security contributions.
| spoonjim wrote:
| Aren't those Deel and Remote?
| taylortrusty wrote:
| This is what Deel and Remote do for international employees.
| PEOs do this domestically (Justworks and Insperity, for
| instance)
| ghaff wrote:
| What I've heard from people who have had to deal with this sort
| of thing is that you can outsource it to some degree but there
| can still be a fair bit of legal effort and cost. Especially
| for smaller companies, it's often just not worth the effort.
| noisefridge wrote:
| From the other perspective, I've also wondered about what it
| would mean to have a union for international remote employees.
|
| Unions for tech workers are rare but if you're working for a
| company with people scattered all over the planet, it's a massive
| increase in complexity. I've never done any serious organizing,
| and the companies I've worked for have been relatively benign.
| But after almost ten years in satellite offices or remote work
| from home, it feels like I'm taking on risks here if I ever get
| into a dispute.
|
| According to one organizer I talked to, you need to form unions
| in each country with "recognized units" of a handful of people.
| At my current company there are knots of employees here and there
| but we are starting to look like the General Assembly of the UN
| with one person per country. Then there's all the varying rules
| on when the employer has the recognize a union.
|
| Are there any precedents for doing this?
| verve_rat wrote:
| Good questions. I unfortunately can't help with any insight.
|
| But my personal policy is to only take jobs that I could walk
| away from and quit the moment anything I'd want union support
| for comes up. A union for international employees seems next to
| impossible, especially with the employer of record thing
| getting in the way.
|
| Luckily the market for my skills is such that I can afford that
| policy. You should probably only consider international
| employment relationships if you are going to be paid a butt
| load of money and can find a replacement job very easily.
| withinboredom wrote:
| I've also thought of this. IMHO, it would be like a
| professional union, not one tied to a specific employer (so
| opt-in only). The job of the union would be to provide legal
| assistance to the employee and consult with employers who hire
| remote workers.
|
| I have lots of thoughts for this, and it's something I think
| about quite a bit as a remote worker. If this is something you
| are serious about, or just want to chat about, look me up.
| CaliforniaKarl wrote:
| GitLab is a great place to check out how this is implemented:
| https://about.gitlab.com/handbook/people-group/employment-so...
|
| Their Handbook talks a lot about what legal entities (first-
| party, third-party, etc.) are in place in different countries,
| for employees in those countries.
| pseingatl wrote:
| An interesting article, but as the author admits, much is
| missing, including:
|
| --applicable tax regime<br>
|
| --immigration<br>
|
| --social security/pension schemes
|
| --workmen's compensation (it's more than just ergonomic home
| furniture)<br>
|
| --presence of employees means doing business?<br>
|
| --exposure to corporate tax<br>
|
| --commercial territory restrictions<br>
|
| and more. A book is needed on this subject.
| whitesilhouette wrote:
| Also salary considerations based on sociological and geographic
| locations. This ideally should never come up, but do come up
| eventually, mostly from the HR side.
| foogazi wrote:
| > mostly from the HR side.
|
| what is different wrt budget here ?
| whitesilhouette wrote:
| when it's about budgetary constraints, it's coming from the
| tax angle, but applied uniformly otherwise. When it's
| coming from HR, your imagination is the limit like a
| person's physical location, skin colour, sex, sexual
| orientation etc.
| ghaff wrote:
| The problem with even a book is that this stuff changes all the
| time. It's not hard to see why, for smaller companies, the
| answer is often just No.
| nerdponx wrote:
| Note that even within the USA, complications arise when you live
| in one state and work in another.
|
| Some (many?) states have mutual arrangements where you can take a
| tax deduction for income taxes paid to another state, but I don't
| think they all do. You might end up paying double taxes! And even
| if the two states _do_ have an arrangement, your employer might
| not set up tax withholding correctly between the two states, so
| you have to carefully check your W-2s to make sure you didn 't
| overpay (or underpay, leaving you with a big bill in tax season)
| throughout the year.
|
| Also, health coverage tends to be very state-specific, so you
| might get stuck with less-than-ideal coverage for your local
| health providers if you're on a health plan intended for another
| state.
| paxys wrote:
| Figuring out who to pay the tax to could get complicated, but
| you will never legally owe double taxes for the same income to
| different states. Whatever agreements or laws these states have
| do not change this.
| verve_rat wrote:
| State A has a law that says if you spend 1 day in State A you
| owe the income tax for that day.
|
| State B has a law that says if you spend more than 180 days a
| year in State B, then you owe State B income tax for the full
| year.
|
| Now you owe tax for that 1 day to both states.
| paxys wrote:
| If state B had such a law then it would be illegal. Even
| California, which is notorious for its tax policies, draws
| the line at "California-sourced income", unless it was from
| a tax-free or lower taxed state, in which case you will
| only owe the difference.
|
| The Supreme Court has ruled on this as well -
| https://www.cpajournal.com/2017/10/26/icymi-supreme-court-
| ru...
| alphabettsy wrote:
| I'm not aware of any state where you would pay taxes without
| being a resident. Afaik it's only complicated when you're
| residence changes often or you technically qualify as a
| resident of multiple states because of travel.
|
| edit: I should have stated, assuming you are not physically
| working in that state.
| dcdc123 wrote:
| Almost every state considers any income for work done while
| you are physically within the state as income sourced from
| the state. This means you pay taxes whether you are a
| resident or not. Most states have some sort of threshold,
| either number of days or earned income. For tech workers you
| are likely to hit earned income thresholds pretty much
| instantly as it is usually prorated according to the number
| of days you are in the state. That said, a huge number of
| people just commit tax fraud by never paying or filing.
| Mostly only CA and NY spend any significant resources
| identifying and pursuing these people.
| ghaff wrote:
| Concur/SAP now has an E&Y service that tracks how many days
| you worked in a state through your expense reports. (So
| obviously doesn't catch personal travel where you were
| working.) I was actually expecting to get hit for a couple
| short trips last year. I wasn't so there must have been
| some sort of threshold even though NC supposedly kicked in
| with even a single day.
|
| But, yes, in general people pay even less attention to this
| than they do to paying use taxes and my accountant has
| never asked me anything about this kind of thing in the big
| questionnaire he sends me every year.
| nodamage wrote:
| There are several states that tax your income based on the
| location of your employer even if you do not live or work in
| that state. New York being the most prominent example since
| they actually changed their policy during Covid. (Presumably
| to capture the lost tax revenue from people living in New
| Jersey who stopped commuting into NYC and started working
| from home instead.)
|
| > _But a handful of states take a different, more aggressive
| approach. They use special rules to tax remote workers based
| on the location of their employer's office -- even if the
| employee doesn't physically work at that location, according
| to the Tax Foundation._
|
| > _Six states took this approach before Covid-19 upended
| office work: Arkansas, Connecticut, Delaware, Nebraska, New
| York and Pennsylvania. But now, that policy is facing fresh
| scrutiny since many people weren't telecommuting by choice
| during the pandemic but were forced to work from home because
| their offices had closed._
|
| > _The State of New York has so far said that it will
| continue the policy despite the pandemic. If you don't live
| in New York, but your "primary office" is there, "your days
| telecommuting during the pandemic are considered worked in
| the state" unless your employer has a formal office at your
| remote work location, the state revenue department says on
| its website._
|
| https://www.nytimes.com/2021/03/12/your-
| money/taxes/2020-tax...
| nerdponx wrote:
| Most states have a "nonresident" filing option for income
| taxes. Whether you actually pay tax in that state depends on
| the specifics.
| alphabettsy wrote:
| True, but that's almost always for work actually performed
| in their state.
| ghaff wrote:
| Yes, but if you are working remotely from a state (or
| attending an event, meeting customers, etc.), you _are_
| performing work in that state. You 're not if you're just
| on vacation.
|
| Historically, most people and most states didn't really
| pay attention to routine business travel but that's
| starting to change.
| ghaff wrote:
| IANAL but here are California's rules for example.
|
| https://moskowitzllp.com/what-is-california-source-income
|
| Wages and salaries. Wages and salaries for services performed
| in California, regardless of the location of the employer or
| the employee (or where the payment was issued), are taxable
| to nonresidents.
|
| Of course, people widely don't follow these rules and many
| states have minimum cut-offs of various sorts but a lot of
| states are starting to crack down.
| alphabettsy wrote:
| The FTB publication linked in that article states:
|
| "Wages and Salaries
|
| Wages and salaries have a source where the services are
| performed. Neither the location of the employer, where the
| payment is issued, nor your location when you receive
| payment affect the source of this income. Part-year
| residents include on Schedule CA (540NR), column E or Short
| Form 540NR, line 32 all wages and salaries earned while a
| resident, regardless of where the services were performed.
| Nonresidents include the income for services performed in
| California."
|
| Without more clarification that would seem to suggest
| remote work would not be taxable since the services are not
| performed in CA.
| ghaff wrote:
| If I'm working on a computer in a state, and the location
| of the employer is irrelevant, it would be hard for me to
| argue that I'm not performing services in that state--
| even if my full-time residence is elsewhere. Where else
| would I be performing them? But IANAL.
| BeeOnRope wrote:
| You would be performing them where you (your body) is
| located at that moment.
| eikenberry wrote:
| Where you are. You are not working on a computer in
| state, you are working on a computer on your desk that is
| talking to a computer in that state. Not much different
| from phones really, do support people technically work in
| multiple states because they use devices (phones) in
| those states remotely?
| ghaff wrote:
| I think we're agreeing. What matters is where your body
| is--not where a computer you're connecting to is located
| or where your employer's HQ or other office is. Or where
| the person you're providing support to lives.
| sokoloff wrote:
| Live in NH and work in MA and you'll pay MA income taxes.
| ghaff wrote:
| Yeah, I know a number of people in NH who were working more
| and more remotely for a company with a MA location even
| prior to the pandemic, who switched their status to be
| officially fully remote. Live in MA/work in NH (no income
| tax) or live in NH/work in MA? Doesn't matter; you pay full
| income tax to MA.
| singron wrote:
| California has a very broad definition of what being a
| "resident" is, so you can be a full-time resident of multiple
| states despite only having a single domicile and mailing
| address.
|
| States generally either tax the global income of their
| residents (e.g. California), or they tax income earned within
| the state (e.g. Connecticut). If you are a resident of the
| former but earn your income in the latter, then you would be
| on the hook for double tax unless there is a specific
| exception.
| dragonwriter wrote:
| > California has a very broad definition of what being a
| "resident" is, so you can be a full-time resident of
| multiple states despite only having a single domicile and
| mailing address.
|
| No, it doesn't.
|
| > so you can be a full-time resident of multiple states
| despite only having a single domicile and mailing address.
|
| You cannot (well, not for California, though perhaps for
| some combination of other states), though you could be a
| tax resident of multiple states in the same tax year by
| having a _series_ of domiciles during the year that each
| were not intended to be transitory when established.
|
| (If you move directly from California to a foreign country,
| but retain citizenship and return to California for more
| than 45 days in a future tax year, you can also be a
| California tax resident with a domicile in a foreign
| country, but because it is keyed on being a California
| resident immediately before departing (and not just for any
| part of the tax year), that wouldn't be a backdoor way for
| multi-US-state tax residency unless the other state had a
| broader rule.
|
| > States generally either tax the global income of their
| residents (e.g. California), or they tax income earned
| within the state (e.g. Connecticut).
|
| California taxes global income of residents and income
| earned in the state by nonresidents; this is, AFAIK, the
| majority rule for states that have income taxes.
| jt2190 wrote:
| > I owed the CRA $15,000, and the IRS owed me $15,000
|
| I'll just add that there are _extensive_ trade treaties between
| the U.S. and Canada that prevent workers from being double taxed
| on income, which is why in this particular case it nets out. This
| might not have been the outcome if this was the U.S. and another
| country.
| Semaphor wrote:
| It's a very common question/misunderstanding coming up in
| /r/Germany (English subreddit about Germany), people thinking
| they can just move to Germany while working for a company in the
| US. Technically, not an issue. But you now need to be employed
| according to German law, including all the taxes and similar
| payments that includes for employees, but also for the employer.
| xtracto wrote:
| AFAIK this is a solved problem. There are plenty of global PEO
| that take care of the local laws to hire people in different
| countries. I currently use Globalization Partners, know about a
| YC one called via.work and have worked with other called AIMS.
| gumby wrote:
| In the US it's the same: if your company is in California and
| you hire a remote employee in Utah you need to register your
| company as a "foreign corporation" in Utah, do Utah payroll and
| follow Utah labor laws.
|
| Actually it's more exciting because not only can you get in
| trouble for violating the Utah labor laws, as a California
| company the employee can complain if they are not treated in
| accordance with certain California rules (that bind to the
| company rather than the employee) -- and win.
|
| In practice though this is all pretty easy to mange; all the
| rules above devolve down to simply: 1 - file a couple of forms
| and 2 - tell your payroll company. Health insurance isn't
| uniform across the country so in practice it's the most
| complicated part to deal with.
| k__ wrote:
| I think, there are many people who work remote in their home
| country and then travel across the world, and in many countries
| that can be illegal if you stay too long.
| ChuckNorris89 wrote:
| Same in Austria, if I want to work here remotely for any
| foreign company, then that foreign company would have to have a
| legal entity opened in Austria and hire me according to
| Austrian laws and pay employer taxes in Austria, for it to be
| legal and by the book, which of course, unless they already
| have an office there or you're John Carmack, Linus Torvalds or
| Fabrice Bellard, no foreign company would go through all this
| hassle just to hire you remotely.
|
| Everyone says this insane amount of legal red tape and
| gatekeeping is the government's way to prevent remote talent
| brain drain to places like the US and prevent local remote work
| turning to outsourcing which, if true, is complete BS reasoning
| as every company who wanted to outsource did that already,
| before remote work became popular.
|
| I feels it's just German and Austria having a cultural and
| national obsession with red tape and regulations for the sake
| of preserving the status quo, and not for improving things for
| the ambitious workers who wish for better opportunities than
| the local market can provide.
|
| ATM, the only way to legally work remotely is either as a
| freelancer or opening your own company and contracting which
| come with their own set of pros and cons.
| Xylakant wrote:
| I honestly don't understand why you're singling out germany
| and Austria. The same holds true for Italy, Sweden, Canada,
| the UK, ... - you cannot employ anyone without registering as
| an employer and following local labor laws. You sometimes can
| skirt it by setting up a contractor relationship, with all
| attached baggage. But there are companies that offer remote
| employment as a service- they have a local entity that serves
| as employer of record for you and take a fixed fee for that.
| ChuckNorris89 wrote:
| _> I honestly don't understand why you're singling out
| germany and Austria_
|
| Because in those two countries, freelancing is the only way
| to skirt around the fact that no company will set up shop
| locally just for you, and if you freelance, you pay higher
| taxes than being a FTE, while also loosing almost all
| benefits that come with being a FTE like sick leave, paid
| vacation, and pension contributions VS for example in
| Denmark, if you're a freelancer, you also get pension.
|
| Yes, in most other countries you have to freelance for
| remote work, but at least in other countries (Portugal,
| Romani, Bulgaria, Spain, etc.) , if you freelance and say
| goodbye to social and workers' benefits, you at least pay
| less taxes since you get no safety net from the government,
| not pay more taxes like in Austria and Germany while
| getting no safety net and no benefits.
| isbvhodnvemrwvn wrote:
| In Poland you pay 12.5% flat revenue tax as a contractor
| vs 17/%32% income tax as an employee, it's a no-brainer
| especially since you need to pay for health insurance
| anyway and you are never going to see the money taken
| from FTEs by the government for retirement. Unlike in
| Germany there is also no enforcement of false employment.
| Xylakant wrote:
| Freelancers in Germany don't pay higher taxes. They pay
| income tax like every employee. They loose the employers
| share of social security and pension, but the remedy for
| that is to adjust rates - you also loose paid holidays,
| sick leave and all of the other employment benefits, but
| same - reflect that in your rates. You can opt into
| pension if you choose to, some freelancers are even
| required to (see 1). If you don't opt into pension, you
| don't need to pay into the pension fund. Unemployment
| insurance is similar: you can opt into it when you start
| freelancing, but if you don't, you don't need to pay for
| it.
|
| (Source: I am for social security and tax purposes a
| freelancer)
|
| (1) https://www.fuer-
| gruender.de/wissen/existenzgruendung-planen...
| bonzini wrote:
| You get pension by paying contributions out of your
| pocket, whereas normally the employer would pay them on
| top of what you earn before taxes.
| Xylakant wrote:
| More specific: if you're employed, you and your employer
| share the contribution roughly half/half and your share
| gets deducted before taxes.
| mejutoco wrote:
| There is another way. Some companies offer this as a
| service. They have offices everywhere around Europe. A
| first-party can hire you through one of these services,
| and you would have all the benefits of the destination
| country.
| isbvhodnvemrwvn wrote:
| AFAIK it's called employer of record.
| atq2119 wrote:
| Pretty sure you can add the US to this list. Try being a
| resident (or even a non-resident citizen! The US is pretty
| unique in that regard) working for a non-US company without
| declaring the income for tax purposes and see how it
| goes...
| woodson wrote:
| It is actually possible for a U.S. company to employ you
| directly as an employee (according to ASVG) in Austria
| without forming a legal entity. They of course have to pay
| Employer contribution to social insurance and other things
| (DB zum Familienlastenausgleichsfond etc.), and you as
| employee have to also pay the employee contribution to social
| insurance and income taxes. You probably want to hire a tax
| accountant to handle your monthly payslips etc.
|
| (Disclaimer: This is not legal advice, I'm not a tax
| accountant/lawyer.)
| bakuninsbart wrote:
| > ATM, the only way to legally work remotely is either as a
| freelancer or opening your own company and contracting which
| come with their own set of pros and cons.
|
| For immigrants from most countries, this only works if they
| are really wealthy or very lucky. We basically just let
| people buy themselves into immigration via Cyprus
| nationality, but hard work or education are minor points in a
| kafkaesque process to get in.
| 8ytecoder wrote:
| This is usually worked around by intermediary companies that
| hire you and then send you as contractors to the original
| company - taking a cut in the process.
| deutschew wrote:
| its really amazing for me to see the amount of
| _kurzsichtigkeit_
| interactivecode wrote:
| The same in The Netherlands. However from what I understand in
| the EU it's a lot easier. For example between France and The
| Netherlands the company doesn't need a full office. You just
| need to register with the countries tax office and pay taxes.
|
| In a lot of cases the taxes are mostly the same just paid to
| the employees country instead of the companies one.
|
| It's mostly knowns in administration what companies seems
| scared of
| [deleted]
| hackerfromthefu wrote:
| Isn't the simple way to setup a company and issue invoices? Any
| thoughts on how common this is, and benefits/pitfalls/challenge?
| maccard wrote:
| That's not being employed, that's running a business.
| hackerfromthefu wrote:
| You can also use an umbrella contracting company to run the
| business for you, and employ you with normal salaried
| employment structure, including pay your pension, healthcare
| or other salary packaging.
|
| Of course the original hiring company benefits/RSUs etc can't
| be passed through easily, you need to get those as cash.
| simonbarker87 wrote:
| You'll likely have massive IR35 (UK legislation specifically)
| issues doing this unless you set the contracts etc up just
| right. But in theory yes this is probably the best approach.
| ghaff wrote:
| There's nothing simple about setting up a company.
|
| Hiring people as contractors rather than employees probably
| does simplify things. But a contractor may, for example, not be
| able to work for you full-time and you may not be able to offer
| them benefits beyond base salary. The bottom line is that, for
| a small company especially, hiring an individual who requires a
| lot of special care and feeding is probably more trouble than
| it's worth.
| aunty_helen wrote:
| >a contractor may, for example, not be able to work for you
| full-time
|
| Hire them on a project basis. When one project ends, setup a
| new contract.
| Ekaros wrote:
| You may not even be able to offer them salary. But instead
| some other payment for work done, or just hourly/daily rate.
| tw20212021 wrote:
| Why would a contractor require special care? On the contrary.
| They supply you the work, you pay for their services, like
| you would a software company. The benefits they choose for
| themselves and factor those in in the rate they ask you.
| There are differences of course, an employee may be more
| loyal, but that's a different discussion.
| isbvhodnvemrwvn wrote:
| In Germany that would be seen as fraudulent employment,
| because they work 100% of the time for one client. and it
| is de-facto employment. It depends on the country of
| course.
| ghaff wrote:
| Because if you've been following gig work/contractor
| debates, there are constraints on who you can classify as a
| contractor in many places. And depending upon the
| circumstances, that person also loses out on things like
| RSUs--and hourly rate probably won't compensate. To be
| clear, companies do do this but it's not as simple as we'll
| pretend you're a contractor and you can send us an invoice
| each month.
| duped wrote:
| It may be illegal for certain roles in your organization to
| be filled by contractors.
| littlestymaar wrote:
| > There's nothing simple about setting up a company.
|
| If it's easy enough for the average Uber driver, I'm sure the
| average HN reader can figure it out (because that's exactly
| how Uber works).
| crypt1d wrote:
| Exactly. This is quite common and is done all the time for
| remote workers, myself included.
|
| The hiring company cannot treat you as a regular employee
| though (you are essentially a contractor), so you may have less
| 'rights' than a regular employee - i.e. your contract can
| likely be terminated a lot easier than a regular employment
| one. You may also not be able to get some benefits that a
| regular employee gets - ie contributions to pension funds, etc.
| These are often compensated by simply increasing your daily
| rate. I personally prefer it that way as I often find the
| benefits offered by the companies unnecessary.
|
| There are also companies like deel.com that offer employers to
| hire people through their local branch office in pretty much
| every country in the world. FWIW I haven't used any myself but
| I have heard good things.
|
| Hence I honestly consider remote working to be a solved problem
| already, but to each his own.
| xtracto wrote:
| With respect of working rights, sometimes it goes the other
| way: I've worked for American companies from Mexico through a
| PEO (the ones in charge of hiring you). Given that these
| usually hire you as a full time employee, you are protected
| by the state rights. In Mexico that entails several things:
| Access to social healthcare, at least 25% of vacation bonus
| (additional pay for each vacation day you take), 3 months
| severance if the company fires you at will, compulsory
| contribution to the 401k equivalent, among others.
|
| At some point us working in Mexico like this had better
| benefits than our peers in the US.
| bjelkeman-again wrote:
| Each team member a self employee with their own company. We
| always tried to solve it that way. We paid everyone the full
| cost of taxes, healthcare etc. Full cost to the company for an
| employee in the HQ country, was the same for one outside, in
| the same economic region. We set up long term contracts.
|
| We had maybe 30+% of the team working that way, if we got big
| enough in a country outside the EU we set up a subsidiary
| there. Often a real pain to administer with a team of 100
| people:, but sometimes the only way to make it work. Indonesia,
| India, Kenya, Burkina Faso, Mali.
| tjr225 wrote:
| The tax implications in the US alone are fairly complicated. I
| expect they will get more complicated as stated wise up to
| companies based in one place but with workers in others.
|
| A few years ago I was at an all remote company and there were
| several all staff emails along the lines of: "you absolutely need
| to talk to your manager before you move to another state."
|
| Certain states were not allowed.
|
| I'm not positive but I think you owe state income tax in the
| state that you are physically in even if it is only for a couple
| of weeks or a month or so. Think of all of the tax fraud that has
| happened in the last two years.
| ghaff wrote:
| >I'm not positive but I think you owe state income tax in the
| state that you are physically in even if it is only for a
| couple of weeks or a month or so.
|
| The details vary by state. In some it's as short as one day but
| there may also be some minimum dollar cutoff--the laws are
| basically aimed at pro athletes and entertainers. I know I
| didn't have to file out of state taxes this year for some short
| business travel; all our expense reports are now audited for
| out of state working days.
|
| Of course, you can usually get off with a certain amount of
| personal digital nomadism if you're not filing expense reports.
| But working for extended periods of time is getting into tax
| fraud territory. And you're absolutely right that a lot of
| people have been doing it, often without really thinking about
| it.
| bombcar wrote:
| I've heard that baseball player taxes are an absolute
| nightmare because they have to file in every jurisdiction
| their team plays in.
| jleyank wrote:
| Including Canada. Well, at least non-covid Canada. I'm sure
| the team or the union has a healthy list of CPA's and
| lawyers who specialize in this. More so in hockey, possibly
| soccer as well.
| verve_rat wrote:
| So there should be a body of knowledge and experienced
| people to handle all this. The employers and employees
| involved just need easy access to this.
|
| Sounds like a nice way for some accounting firms to
| expand their market.
| ghaff wrote:
| Oh, it's easy to track. And my accountant would have no
| trouble filing a bunch of additional state tax forms for
| me. But it would probably cost me a couple thousand
| dollars.
| fallingknife wrote:
| States should ditch the income tax altogether in favor of sales
| tax. Then you are paying where you are located no matter what.
| No "residency" concept (and all it's associated bureaucracy) is
| needed.
| withinboredom wrote:
| This doesn't work. Taxes don't just pay the governments
| bills, they also work to make sure the rich don't get too
| rich (otherwise your land owners could get richer than the
| government and toss you out of power). We are literally
| watching this happen in the US where the rich are too rich
| and basically do what they want.
| autarch wrote:
| > I'm not positive but I think you owe state income tax in the
| state that you are physically in even if it is only for a
| couple of weeks or a month or so. Think of all of the tax fraud
| that has happened in the last two years.
|
| Just to clarify, the important "you" here is your employer. In
| many (if not all) states, having a full time employee work from
| a state establishes a tax nexus there, making the _employer_
| liable for collecting sales taxes (if applicable) and requiring
| them to pay taxes on their business income to the state (again,
| if applicable).
|
| It's the taxes on business income that can be quite painful for
| the employer. If the state has particularly high taxes,
| employing just a single person in that state may not be worth
| the additional cost in taxes.
|
| This is all completely insane, of course. Doesn't the EU, made
| of actual separate countries, have a solution for this? So why
| can't the regions of _a single country_ do the same thing?
| Because we're a dysfunctional mess of a country, that's why!
| Sebguer wrote:
| I'm pretty sure the 'EU' solution for this is just that you
| are responsible for collecting VAT in every single country,
| regardless of any nexus. It's not actually really any
| simpler, but it does mean that taxation is no longer tied to
| a business presence. Specific tax laws still vary between
| countries.
| autarch wrote:
| I'm no expert on VAT, but it seems like this is a lot more
| like the sales tax case, where you are required to pass the
| cost on to customers. I'm sure companies prefer to avoid
| this, but it doesn't seem like it'd be nearly as strong a
| disincentive as having to pay business income tax in
| another state.
| Sebguer wrote:
| Oh, fair, I hadn't thought about it from that
| perspective. I think the challenge is that you still have
| to know the VAT nuance (and categories) for every country
| you operate in, and failure to do so correctly will
| result in you getting a tax bill, regardless. I don't
| think it's actually any less burdensome than the US'
| system, but I'm also not an expert on either system (just
| adjacent exposure working around it).
| withinboredom wrote:
| Sorta. If you're a small company, you can just charge your
| home VAT. Registering for MOSS and paying out all VAT based
| on location of the sale would be something you do with your
| accountant when you get a little bigger.
| aunty_helen wrote:
| Honestly? 1500 words before this post even gets anywhere.
|
| >In only a few months, the coronavirus ('COVID') pandemic had
| devastating economic, social, and health impacts worldwide.
| Today, millions of lives have been lost, and the end of the
| crisis seems it may finally be in sight
|
| Here's 37 words that literally no one needed to read.
| mpalmer wrote:
| No one reading it in 2022, maybe. Easy to imagine someone
| reading it in 20 years and benefiting from the context. Have
| some perspective.
| rmbyrro wrote:
| How many people will read it today and how many are likely to
| read in 2040?
|
| I would argue it's better to optimize for today's readers.
| Not that difficult for 2040's readers to pick the context.
| aunty_helen wrote:
| >The pandemic has also accelerated an already existent
| movement of remote working.
|
| The very next line that will allow for that.
|
| This info also doesn't have a long lifespan as laws are
| always changing and digital nomad visas are becoming more
| common. In 2 years time much of the information may not even
| apply to the country that you're living in.
| rmbyrro wrote:
| And even when it gets to the point, I don't understand why they
| have to complicate matters so much.
|
| I may be an outlier, but have been working cross-border
| remotely for 6+ years and absolutely never needed this legal
| stuff.
|
| Quite opposite, I was super thankful to have an excuse to
| escaping local legal insanity and also ignoring insanities
| abroad.
|
| It's like being "country-less" in terms of these crap legal
| stuff.
|
| It's a dream.
|
| Again, my personal experience here. Don't know if it works the
| same for all...
| aunty_helen wrote:
| I've found the same over the past 4 years. Escaping the
| overburden of 'first world' countries can be extremely
| liberating and help get shit done.
|
| Now that I'm hiring staff this stuff actually applies but
| whenever there is information presented it's "speak to a
| legal representative" as the bottom line. When you speak to
| someone pro bono it's "depends on what country you're in,
| been in, born in, planning to stay in", then when you finally
| pay it's still your responsibility if something gets messed
| up.
|
| There's companies out there that claim to solve these
| problems for you, I fired one of them this week because they
| couldn't get the basics of pay the people on time right.
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