skip to Main Content
Capitalizing On The Financial Benefits Of Your Newly Distributed, Remote Workforce

Capitalizing on the financial benefits of your newly distributed, remote workforce

In our last blog post, we discussed the tax, financial, and compliance implications of managing a distributed, remote workforce during the COVID pandemic. In that post, we touched on the increased compliance risk that comes with your new remote employees. With that risk, however, comes the opportunity for significant savings. 

There are some obvious savings associated with leveraging remote employees – the biggest, and probably most touted, is the ability to reduce real estate costs. However, if an organization has long term leases or already owns the land/buildings, the opportunity for immediate savings this year may be limited. However, another area organizations may be able to see significant savings this year, particularly if they live in major cities like New York City, Philadelphia, Los Angeles, San Francisco, or Washington D.C if they act quickly to capitalize.  

Many cities around the world tax businesses located in those cities based on the income earned from operations within their city limits. As many employees don’t live in the cities they work, and those employees are now working from home, there is the opportunity for businesses to potentially save significant sums in the taxes they pay to their local municipalities. Being able to show which employees are working outside the city — and prove it — can help significantly lower their taxes. 

For example, New York City’s 4% unincorporated business tax (UBT) raises about $2 billion a year for the city by taxing investment-fund managers, law firms, and other individually owned businesses the portion of sales or services performed within the city. Since COVID-19 shelter in place orders began, many of those employees are working from home on Long Island, or Connecticut, or New Jersey. This creates the opportunity to show income was not earned through activities within the city. In fact, Topia is helping one customer save upwards of $3 million in estimated taxes this year alone by showing that employees were not working in the city. 

The key to capitalizing on these savings is reliably and accurately showing who is working from where. This is something that only a technology solution can accomplish without providing a prohibitive administrative burden on employees or HR, payroll, and finance teams. Thanks to technology from Topia, HR, finance, and payroll teams have access to instant reports to assess city tax exposure, ensure the right amount is paid, and retain the data to protect against audits. To learn how a solution from Topia can protect your organization from taxes, download this factsheet.

This Post Has 0 Comments

Leave a Reply

Your email address will not be published. Required fields are marked *

Back To Top