Many European corporations have made the decision over the past few years to strategically grow their operations to the USA. While this provides a lot of attractive prospects, it also comes with wide-ranging implications and responsibilities. Most importantly, it requires careful planning.
In this Global People Mobility Webinar #EuropeGoesUSA session, an expert panel from Global Tax Network, Visalaw and Noah Mobility shared their insights on immigration, taxation and relocation challenges that need consideration.
The panel was aimed at startup C-Level members and HR Departments on their journey overseas.
Check out their findings below:
Main Findings
- Relocation Tech Providers are vital to the transfer experience for international employees in the US.
- The biggest hurdle when relocating a family is the school search for children, due to the huge difference between US and European education systems.
- 60% of early stopped assignments happen within the first year because the family or spouse do not receive the support they require.
- A big challenge facing international employees relocating to the US is understanding the immigration and tax system since it is very complex and outdated.
Immigration Focus
The US immigration system is very complicated and antiquated and one of the biggest challenges immigrants face when moving to the USA is the lack of technology-based solutions currently available.
From a family perspective, it can often be that the employee’s needs are well covered by the employer but the family’s needs are often left out or forgotten. Searching for a home and school is one of the most difficult and often underestimated struggles for families moving to any new country, but particularly the US. There is a marked difference between the European and US education systems, and Education Consulting is highly suggested or sometimes required for immigrants/expats from the start to ensure their children find places in appropriate schools.
Taxation Focus
Relocation tech providers can help people right from the start, meaning before they even arrive in the US. They are important to the overall positive transfer experience, especially in the US where the systems are clunky and complicated.
The role of a relocation tech provider is to make the experience turnkey. They should be acting as the middle man and connecting their clients to the correct tax & immigration service providers locally.
Relocation Focus
There are two very clear trends when it comes to relocation support in the marketplace.
The first is the “lump-sum” approach, most commonly seen in start-ups and for younger employees without families. This involves the employer handing an agreed amount of money over to the employee for them to go forward and handle their own relocation efforts. While it is a simple approach from an employment perspective, it is based on the assumption that employees are very tech-savvy and understand what they are doing in terms of researching and finding vendors and providers.
The second trend is a “hands-on” approach, more common with traditional companies and particularly with new employees in senior management positions who often move with their families. In this trend, the HR department steps in and handles all details around immigration, taxes and housing. They also tend to provide more support to the spouse and children and their specific needs.
To give an idea of how important support for families and spouses is, it’s estimated that 60% of Early Stopped Assignments happen within the first year purely because the family or spouse does not receive the support they require.
Speakers:
- David Livitt, GTN
- Lynn Carbo, GTN
- Thomas Szoeke, Noah Mobility
- James Hollis, Visalaw
