The Office of Tax Simplification (OTS) has launched a new review looking at emerging trends in hybrid and distance working, and whether existing tax rules and guidance are keeping pace.

Recent years have seen a rise in the number of people working from home and flexibly, including those who work overseas for all or part of their time. However, the presence of employees overseas can cause problems for employers - not just when it comes to employment taxes, but also with regards to the countries in which the employer may be taxable on their trading profits. Within the UK there are also concerns that the current rules and guidance around employee expenses are outdated and difficult to apply in the new world of work.

To address these concerns, the OTS review will look at a number of issues relating to hybrid and distance working, including:

• The implications of employees working across international borders for individual and corporate taxes, social security and tax residence.
• How accommodation, travel, and other expenses work in a hybrid world and whether the current tax rules make sense.
• The application of short term business visitor rules, overseas workday relief, and modified payroll.
• The treatment and impact on pension contributions and share schemes.

The OTS is keen to engage with a wide variety of individuals, including employers and employees of all sizes and sectors. They have produced a Hybrid and distance working survey aimed at employees and the self-employed, but also invite feedback via meetings or written responses by the closing date of 25 November 2022.