Papua New Guinea Tax Alerts - COVID-19 Response

Analysis

Papua New Guinea Tax Alerts - COVID-19 Response

COVID-19 Measures

Income Tax Implications Relating to Stranded Employees

In response to the World Health Organisation declaring COVID-19 a pandemic on 11 March 2020 and the rising levels of infection, countries around the world have implemented various forms of travel restrictions and/or border closures. In this regard, Papua New Guinea (PNG) declared a State of Emergency which includes a ban on international travel into PNG even for PNG citizens.

The travel restrictions and /or border closures have left workers in situations that could have unintended tax implications for the workers and their employer companies.

In this alert 4 scenarios have ben identified. In these scenarios, changes in the tax residency and source of income for the employee will need to be considered, as well as taxation implications for the employer itself.

Income Tax Implications Relating to Stranded Employees

IRC issues explanatory note on COVID 19 announcements

In this issue we refer to our Tax Alert of 2 April 2020, and specifically Phase 1 of the IRC Covid 19 response. In this issue we elaborate further on these measures based on an Explanatory Note subsequently released by the IRC. We also update you on a recent notice from the Office of the Registrar of Companies (IPA) and PNG Immigration.

Explanatory Note on Phase 1 of COVID-19 measures announced and effective from 1 April 2020:

The IRC has issued an Explanatory Note to clarify its notice on 1 April 2020 regarding the IRC’s Phase 1 of the COVID-19 response. We summarise below the IRC’s Explanatory Note.

IRC issues explanatory note on COVID 19 announcements

Tax and PNG labour and immigration measures - effective 1 April 2020

In this issue we summarise the first tax and labour and immigration measures announced in response to the COVID-19 pandemic.

Phase 1 of Covid-19 measures announced and effective from 1 April 2020:

The Internal Revenue Commission (IRC) has issued its first notice in this regard on 1 April 2020 that sets out Phase 1 of the Covid-19 response. In addition to the Phase 1 administrative measures, the IRC with Treasury are considering a number of policy measures that will provide further relief to Taxpayers if the impact of Covid-19 on the country worsen (described as Phase 2 and Phase 3). Details of what these additional measures may be have not yet been released.

Tax and PNG labour and immigration measures - effective 1 April 2020
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