Double Taxation Halted Cross-Border Hiring
Hybrid tax compliance risks have forced employers to cut off remote hiring pipelines for cross-border staff.
Updated on Oct. 7, 2026 in Remote Work
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Legislators have raised concerns over dual payroll complications that are forcing companies to end cross-border remote work arrangements. This shift impacts 19,000 workers who travel across the border for employment.
Why it matters
Hybrid work models create significant audit risks and tax compliance burdens that many firms cannot manage. These regulatory hurdles have caused businesses to stop hiring talent from neighboring jurisdictions.
An Economic and Social Research Institute report identifies 19,000 people moving across the border for employment. One Donegal technology company, which employs 1,000 staff, previously utilized 60 to 70 cross-border workers before stopping such hiring last year.
The players
Pádraig Delargy
An assembly member who brought cross-border tax concerns to the Stormont Assembly.
Stormont Assembly
The devolved legislative body responsible for governance and policy debate in Northern Ireland.
The details
Companies are struggling with the administrative weight of managing dual payroll and complex cross-border tax liabilities. One firm attempted to manage these obligations internally but ultimately restricted staff to fully in-person or fully remote roles to avoid audit risks. This forced businesses to cease hiring workers who reside across the border rather than navigate the conflicting tax jurisdictions.
Timeline
March 2026: The UK-Ireland Summit took place in Cork.
Summer 2026: An IBEC-CBI Joint Business Council report was published.
2026: Governments expect to reach a decision on cross-border working policies.
Market Landscape
This development highlights the growing conflict between flexible work policies and static cross-border tax regimes. It follows the momentum set by the 2026 UK-Ireland Summit, which prioritized addressing bilateral working concerns.
Operators currently employing or considering staff across national borders should monitor the 2026 bilateral policy decisions for potential payroll relief. In the interim, consult with specialized cross-border tax counsel before formalizing remote hybrid agreements that could trigger audit exposure.
The takeaway
Tax compliance friction is currently overriding the benefits of hybrid work for many cross-border employers. Monitor upcoming bilateral announcements from the British and Irish governments to determine if you can safely restart cross-border hiring pipelines in 2027.
Further reading
For more on the operational challenges of distributed teams, visit our Remote Work section.
Source note: This article includes information reported by Derry Journal.
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