Private university benefits from tax guidance

Institutional challenge

A private university needed tax guidance to establish a campus subsidiary in a foreign country, including payroll issues related to expatriate employees and foreign tax reporting requirements. The client needed a team of tax professionals specialized in the higher education field, experienced in international expansion projects, and with multi-lingual capabilities.

Baker Tilly solution

Baker Tilly comprised a team of specialists with expertise in higher education, international capabilities, and multi-lingual skills to review the payroll and corporate tax reporting needs of the university in the foreign country. Baker Tilly analyzed the payroll structure of the expatriates performing duties in another country, including performing preliminary and final tax calculations according to various scenarios, reviewing compensation packages and employee contracts, analyzing split wage allocation scenarios, calculating hypothetical tax calculations, and drafting the tax equalization policy for the university. The Baker Tilly team acted as a liaison and collaborated with Baker Tilly affiliates globally to establish a tax strategy to maximize tax efficiencies and comply with foreign and domestic tax requirements. 

Results

The university was able to establish equitable compensation packages for its professors who were performing duties in a foreign country. Further, the local Baker Tilly firm was able to provide guidance regarding local tax issues for both the university and the U.S. employees providing services in that country. As a result, the university established a tax compliance process and strategy that maximized tax efficiencies and met the requirements in the United States and the foreign country in which the campus was established.

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