There are a number of shifts — economically, politically, socially — happening in the world today that make cross-border business travel more complicated than ever. While businesses are becoming more global, governments are becoming more concerned with protecting their borders, jobs and the financial interests of their local population…creating friction with business travel.
The digitization of data has also increased the risk profile for multinational corporations looking to put the right people in the right places at the right time. Digital records are easier to share across government agencies. In the U.S., the Internal Revenue Service now uses data from the Department of Homeland Security to check a company’s tax returns against those of its employees for potential inconsistencies. There have also been similar approaches adopted in countries such as Canada, Singapore, and Australia.
In order to stay compliant with global tax and immigration regulations, companies need to understand where their business travelers are, for how long, and the work activities they’re doing. To get a sense of your travel risk, begin by answering these questions:
- Does your organization have a centralized process for identifying and reviewing the tax, social security, and immigration compliance of your business travelers before they travel?
- Do you have a formal policy for addressing the risk and compliance requirements for your business travelers?
- Do you have access to real-time data on immigration and tax requirements for the countries to which your employees travel?
If you answered no to any of these, your business travelers could be triggering tax, social security, immigration or permanent establishment liabilities – and your organization could be at risk for noncompliance.
While understanding an organization’s travel footprint is critical to mitigating this risk, existing processes for doing so are often inefficient and onerous — resulting in inconveniences for business travelers and complexity for travel and finance managers. Limited access to information and guidance, duplicate data entry, and having to switch between multiple systems creates a cumbersome experience for employees. Similarly, fragmented data and inconsistent information can cause travel and finance managers to discover non-compliance when it’s too late.
The only holistic, accurate and efficient way to ensure employees have the correct immigration permissions to enter a country, and that they’re compliant with country-specific taxes triggered during travel, is with a solution fully integrated into their travel booking workflow.
To learn more about cross-border travel risks and how you can mitigate them, download our whitepaper Global Business Travel Tax and Immigration: Mitigating Complexity and Risk Amid Brexit, Travel Bans, and Trade Wars.