On August 31, 2020, Friedemann Thomma, Becca Chappell, Molly Schneider, and Misha Goodwin published “EU Adopts Taxpayer-Friendly Residency Approaches Due to COVID-19” in the Daily Journal. The following is an excerpt:
Recent COVID-19 travel restrictions have created risk of additional corporate income tax liabilities and filing obligations for many companies with employees, directors and/or agents who have been unable to work from their normal office location. In response, taxing authorities from several European countries have announced temporary measures that relax permanent establishment and corporate tax residency rules for such employers. Taken together, these announcements suggest a universal willingness among tax authorities to respond to the COVID-19 crisis and accommodate taxpayers as they navigate the evolving business realities of a grounded workforce. However, as borders begin to reopen, companies with directors and employees who continue to work abroad should continue to monitor the applicability of this temporary relief to their remote workforce.