As Singapore is a regional hub to many multinational companies, employees based in Singapore may have regional roles that require them to travel and perform services in multiple countries across Asia. In some instances, the regional role may only extend to one other country. For example, an employee while being employed by a company in Singapore is also required to physically work in another country.
If the employee of a Singapore company works in another country, the Singapore company may be exposed to corporate tax in the other country. If this corporate tax risk is a concern, there are several ways to manage the tax risks. If the employee is required to physically work in 2 countries and there are group companies in both locations, the dual employment contractual arrangement (“DE arrangement”) could be considered to mitigate the tax risks.
While DE arrangements are often viewed from an individual tax planning perspective, this article focuses on cross-border corporate tax implications.
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