With governments encouraging workers to stay away from the office to help limit the spread of Covid-19, many employers have found that remote working means employees logging on from further afield than the suburbs.

The Financial Times reports that city banks are becoming uneasy about potential exposures to overseas taxes (as well as regulatory concerns) linked to employees working from holiday homes outside the UK. This issue likely goes beyond financial services to other industries where a valuable contribution is being made by employees currently working outside their company's home jurisdiction.

Early in the pandemic, tax authorities (including HMRC and, at an international level, the OECD) made reassuring noises about the temporary nature of disrupted work patterns connected with lockdowns and travel restrictions. The idea being that companies ought not to become taxable overseas by default simply because employees were stuck in the wrong place.

But the key point back in spring was that disruption was expected to be "temporary". Several months in, with many firms pushing a return to the office into early 2021 or beyond, it is worth reassessing whether changed working patterns really do count (from a tax perspective) as a temporary response which will be unwound once the pandemic is under control and things go back to normal.

Discussion around the "new normal" suggests that it would be wrong to expect remote working to go back to pre-pandemic levels. The traditional model of taxing office-based companies only in their home state, unless they have a set up an office in another jurisdiction, will be under increasing scrutiny if we see a permanent shift in working patterns as a result of the pandemic.