The rise of remote and hybrid work has led to employees spending less time working from their city- based offices and more time working from their homes - that may be located outside of New York City. Even though teams are starting to return to the office, working from home at least one or two days a week has become increasingly popular. If your employees are spending less time working in NYC this could lead to significant savings for businesses subject to Unincorporated Business Tax (UBT).
In today's article, we discuss saving New York City UBT in the age of the hybrid worker and explore how Topia's technology can help your business save significant dollars.
What is UBT?
New York City’s UBT is the third-highest city tax in the United States at a 4% rate. UBT is calculated based on individual employees’ time spent in NYC, which means companies with employees working outside the city could be at risk of overpaying.
- NYC’s UBT is an entity-level tax on partnerships, LLCs, and other unincorporated businesses
- Imposed at 4% rate
- For service providers: based on where services are performed
Impact of hybrid work on UBT
Tax-savvy companies can potentially avoid millions in overpaid taxes related to over reporting compensation for work done outside city limits.
As hybrid work becomes the norm, more and more people are either working from home full time or splitting their time between the office and home for two or three days a week. There’s an apparent financial gain for companies who can prove how much time their employees are performing services outside New York City. But companies must have audit defensible data at the ready at all times.
NYC is getting more aggressive in the UBT space, and the burden of proof is on the taxpayer to illustrate and prove the methodology and math applied to UBT calculations.
Topia Compass helps NYC-based Asset Managers reduce their tax burden anywhere between $250k – $4m+ a year by actively monitoring employee footprint on a city or jurisdiction level to ensure employee privacy while enabling tax optimization and audit defense.
Use our NYC UBT Savings Calculator to determine how much your company could save.
Join other leading companies and ensure you pay only what you owe on UBT.
Topia's powerful technology aggregates employee working locations from numerous sources to intelligently and accurately determine how much time employees are spending in and out of the city. With Topia’s bank-grade security and jurisdictional level data roll-up Topia can ensure employee privacy while enabling tax optimization and audit defense.
A growing number of investment firms are using Topia technology to ensure they are paying only what they owe, which has led to substantial savings on UBT.
With Topia, you can:
✔️ Understand employee footprint
✔️ Access audit-defensible data at your fingertips
✔️ Deliver instant ROI
✔️ Maintain employee privacy
Check out the case study below to see Topia technology in action.
Find out if your New York Office Qualifies for Work From Home Tax Savings here.
Covid-19 has changed the working landscape for employees and employers everywhere. Now more than ever, individuals who used to travel to New York City for work are logging in remotely from home, delivering their services miles away from their Manhattan offices. As reported by the Wall Street Journal in a recent article, these new circumstances present a unique tax-savings opportunity for companies subject to UBT
Stop overpaying taxes by collecting employees’ out-of-city time. 50% less time in the city may mean a 50% reduction in UBT owed.
For a deeper dive into this subject download our eBook.
