KPMG International
GO International Assignment Policy (Assignee)
[Incorporating Personal Temporary International Moves]
Table of Contents
Introduction
1
1.1 Policy scope and context
1.1.1 Types of international moves
There are broadly four types of international movement of KPMG personnel; two of which are governed by KPMG’s Global Opportunities (or ‘GO’) Program, and only one which applies to this policy, per the table below:
1. 3 months is a cumulative presence in a single host country within any 12-month period.
2. Maximum duration may be less than 5 years depending on type of international assignment.
3. Standard duration is 1-2 years. An individual may request a move of between 3-12 months, but it will be approved at the sole discretion of KPMG.
4. A ‘one-way ticket’ with employment/partnership relationship terminated with current member firm.
5. An individual is hired by a member firm from outside the KPMG network, but he or she is either currently a resident of another country and/or is not a citizen of the country where he or she is being hired.
6. Relevant home member firm policy/procedures govern such moves.
7. The GO International Transfer Policy and the relevant host member firm transfer policy govern such moves.
8. Responsibility for IBTs is usually either a specialist IBT team or part of the wider People team. In some member firms the IBT specialist may be part of the Global Mobility function.
9. KPMG International’s Global Mobility Central Team only has responsibility related to international assignments and personal temporary international moves.
10. Responsibility for international transfers usually resides with the host member firm team that manages recruitment. Global Mobility’s role is typically limited to providing advice when requested.
11. Responsibility for these hires usually resides with the same People group that handles domestic recruitment.
1.1.2 GO Program Vs specific global mobility programs
The GO Program is the KPMG Global Mobility program. However, different parts of KPMG (e.g., divisions, functions, locations) develop specific global mobility programs. The distinction between the two is as follows:
1.1.3 International assignments and personal temporary international move
There are four types of international assignments, as well as a personal temporary international move, offered under this policy. The different parameters are set out in the table below, and detailed information in the relevant policy sections:
1.1.4 Policy application
Country-specific policy aspects
This GO International Assignment Policy (incorporating personal temporary international moves), hereafter ‘the policy’, establishes standard terms and conditions that apply globally to all international assignments and personal temporary international moves.
Each member firm as both a sender (home country), or receiver (host country) of KPMG personnel, needs to develop and maintain its own operative rules and regulations to implement this policy, accounting for its own legal and regulatory environment. This includes:
Consistent policy application (as opposed to one-off negotiated conditions) helps to facilitate fairness and equity of treatment of assignees and individuals.
Compensation packages are provided under this policy using the following categories:
1. All international assignments excluding the short-term international assignment are collectively called ‘long-term international assignments.’
2. Maximum total duration includes any extensions; and original duration must exceed the minimum.
3. Standard duration is 1-2 years. An individual may request a move of between 3-12 months, but it will be approved at the sole discretion of KPMG.
4. There is no host country business case/ need for the individual and the move is instead to accommodate a personal request to work in a host location.
5. Unaccompanied basis so no expense reimbursements, or any other support, will be provided for family members should they choose to accompany the assignee/individual to the host country. See section 1.2.3.
6. Accompanied by dependent family members only. See section 1.2.3.
Setting all location-specific allowances and benefits (usually in local currency); and
Amending the provision of specific policy elements as necessary (including reduction/elimination and/or enhancement) to ensure compliance with local laws, regulations, directives etc.
1.2 Compensation structure and methodology
1.2.1 Compensation categories
One of the most important differences between the compensation packages offered for the various international assignment/move types is the compensation basis used to provide various elements. KPMG utilizes two alternative compensation philosophies as set out in the table below:
1.2.2 Compensation basis
All long-term international assignments allow for assignees to be offered ‘accompanied status’ for ‘dependent family members’ (see the definitions applicable to this policy in the table below). Long-term international assignments can also be offered as ‘single/ unaccompanied status’ (which is also the only option for short-term international assignments and personal temporary international moves).
1.2.3 Family and accompanied status
If KPMG makes contributions to any employee benefit plan in the host country, and the employer contributions are subsequently refunded to the assignee/ individual after departure/repatriation, such refunds are owed by, and must be returned to, the KPMG member firm that originally funded the contributions (notwithstanding legal restrictions – see section 1.3.4).
For assignees/individuals paid using the ‘host-based compensation’, the home member firm should maintain a ‘nominal/shadow salary’ (where possible and feasible within system constraints), which is used to:
The nominal/shadow salary should be revised, as appropriate, as part of the standard performance and pay review in the home country. Please note, maintaining a nominal/shadow salary does not in itself require the operation of a shadow payroll.
Host country refund of KPMG-funded employee-benefit plan contributions
Home country shadow salary
Facilitate repatriation and reintegration (as the nominal/shadow salary at the end of the international assignment/move will be the one provided after repatriation, notwithstanding job/role changes).
Determine contributions to home-country employee benefit plans during the international assignment/move; and
The owner of this policy is the Global Head of Mobility, on behalf of KPMG International’s Global Management Team.
Please also note the following:
1.3 Policy administration and governance
1.3.1 Policy owner
1. See throughout sections 3, 4 and 5 which detail what policy elements apply to accompanying dependent family members.
2. This includes those who may spend part of the year residing elsewhere, such as children at boarding school or tertiary education during term-time; or children that split time living with parents who do not live together.
As a default, when KPMG agrees to offer the assignee an ‘accompanied status’ compensation package, the dependent family members included will be restricted to children (minors or under the age of 25 in full time education). However, KPMG may, at its sole discretion, include other dependent family members on a case-by-case basis in exceptional circumstances.
A dependent family member may not be able to accompany the assignee on international assignment due to laws and regulations of the host country (e.g., immigration).
Nothing in the sub-section precludes the assignee or individual from deciding who should accompany them on an international assignment or move. It merely establishes the parameters within which KPMG would consider providing relevant policy benefits.
This policy document is effective 1st January 2023 for all new international assignments/moves starting on or after that date. It supersedes and replaces previous policy versions.
The T&C letter should be finalized and signed by all relevant parties before the start of the international assignment/ move.
The policy owner is responsible for interpretation of this document and oversees its implementation.
No policy can address all the possible situations and circumstances that pertain to scenarios. To the extent that a specific issue is not covered in this policy, it should be discussed with, and resolved by, the policy owner (see section 1.3.1) or designated delegate.
Each international assignment/move is governed by their individual terms and conditions letters (‘T&C letters’). The individual T&C letter will take precedence if there are discrepancies between it and this policy, including any exceptions to policy.
Repatriation provisions for assignees/ individuals (see sections 2.5, 3.5, 4.5, 5.5 and 6.5) are based on the policy in place at the start of the international assignment/ move. Therefore, the repatriation package provided at the end of the international assignment/ move will not be based on any new/updated policy versions that may be implemented during it.
However, if the international assignment/ move duration is extended the home member firm and the assignee/ individual may mutually agree to update the repatriation provisions to reflect the new policy as part of the extension agreement.
In both scenarios, the repatriation provisions will be based on the assignee’s accompanying family size, and the assignee’s/ individual’s applicable grade/level (as approved by the home member firm) at the time of repatriation.
See section 1.3.4 regarding the possible amendment of repatriation provisions if the assignee/ individual voluntarily resigns or is terminated for cause.
The policy owner can delegate authority regarding certain facets of the policy to designated representatives (‘designated delegates’), for example, to the Head of People/Head of Mobility for a particular member firm for country-specific aspects.
1.3.2 Policy implementation and interpretation
T&C letter
Repatriation provisions
1.3.3 International assignment structure: secondment and relocation
Both the secondment and relocation continue for the duration of the international assignment/move. Afterwards, the assignee/individual repatriates to the home location, stops working for the host member firm and resumes a role with the home member firm.
This policy assumes the standard ‘secondment and relocation’ structure is used, which is defined below:
The secondment and relocation structure is designed to manage risk issues such as:
If any stakeholders have a business reason to deviate from the secondment and relocation structure, it is essential that the Global Mobility team is informed at the outset. This will enable engagement with all appropriate KPMG parties to be involved in any decision-making, including design and either approval or rejection.
This policy document assumes that the secondment and relocation structure is applied.
Adjustments to terms and conditions
This policy is a purely voluntary arrangement on the part of KPMG that will not be construed as giving any assignee/individual a legal right against any member firm, including any entitlement to the provisions herein. Each international assignment/ move has its specific terms and conditions outlined in the assignee’s/ individual’s T&C letter (see section 1.3.2).
KPMG also reserves the right to adjust the terms and conditions provided to any specific assignee/individual to maintain the integrity of this policy. If the assignee/ individual is, for example:
Compliance violations (such as immigration); and
Financial costs (e.g., corporate/partnership and individual taxation).
1.3.4 Policy disclaimers
Entitled to additional compensation based on host country law, the international assignment/move allowances and benefits provided could be reduced or amended to compensate for the additional payment mandated by law (also see section 2.1.1 as this relates to short-term international assignments).
‘Voluntarily resignation’ (for the purposes of this clause) means the termination by the assignee/ individual of employment with, or partnership of, the home member firm, whether with or without notice except where such a termination takes place on the grounds of disability or ill health.
In cases of voluntary resignation and termination for cause, KPMG has the right, at its sole discretion, to amend or withdraw any or all of the following provisions of this policy (notwithstanding legal requirements in the home country and host country):
‘Termination for cause’ (for the purposes of this clause) means the termination of the assignee’s/ individual’s home member firm employment/ partnership agreement/ participation in a partnership by the relevant home member firm or other entity (whether with or without notice) (i) a breach of any law, regulation, policy or contract (whether in connection with, without limitation, the home member firm or host member firm or any regulator or government body or authority or otherwise), or (ii) any misconduct or negligence in connection with his or her employment or engagement, or (iii) any activity which, in the reasonable opinion of KPMG may bring KPMG (including, without limitation, the host member firm, the home member firm or any other member of the KPMG network or any of their clients) into disrepute.
Adjustments to the terms and conditions can also be made on a case-by-case basis, to compensate if KPMG is unable to implement any part of the policy due to, for example, legal restrictions.
Also, see section 1.3.5 regarding ‘repayment clause’ implications of voluntary resignation or termination for cause.
Voluntary resignation/ termination for cause during an international assignment/ move
Married to, or is a domestic partner of, someone who receives ‘expatriate’ or ‘relocation’ allowances/ benefits/ services (as a KPMG professional or via working for another organization) KPMG reserves the right to reduce or amend the any provisions in this policy to avoid any inappropriate duplication. Potential assignees are required to disclose these situations.
Ongoing international assignment/ move allowances and benefits (see sections 2.3, 3.3, 4.3, 5.3 and 6.3);
Repatriation benefits (see sections 1.3.2, 2.5, 3.5, 4.5, 5.5 and 6.5); and
Tax policy and tax compliance services (see sections 2.6, 3.6, 4.6, 5.6 and 6.6).
Temporary suspension of international assignment/ move or location change
1.3.5 Repayment clauses
A temporary suspension of an international assignment/ move occurs if, for a consecutive period of more than 14 days, the assignee/ individual relocates from the host country to the home country, or any other country. This excludes any approved standard leave entitlements.
The default position for all international assignments is that allowances and benefits provided to all assignees (as per this policy) are not subject to any repayment or claw back. KPMG does not seek to be reimbursed by the assignee for the provision of such compensation under any circumstances.
The above general rule applies to the standard international assignment arrangements (assignee completing the international assignment, repatriating, and recommencing work for the home member firm). However, there are limited circumstances where it is possible, though not recommended, to deviate from the general rule. These circumstances include:
A temporary suspension may be approved or rejected at KPMG’s sole discretion, based on the unique facts and circumstances, that will determine the viability of such an arrangement (including the reason for the suspension, such as factors outside the assignee/ individual’s control). However, if the temporary suspension period is anticipated to be greater than six months (or more than the remaining duration of the international assignment/ move) KPMG will, as a default, invoke early repatriation.
If a temporary suspension is approved, KPMG reserves the right to adjust the terms and conditions of any assignee’s or individual’s terms and conditions (per this policy). The adjustment to the terms and conditions includes, but is not limited to, revision/ suspension/ removal of any allowance or benefit. Any adjustment will be conducted on a case-by-case basis and will depend on both the reason for, and arrangements during, the temporary suspension (e.g., continuing to work for the host member firm, taking extended leave, or recommencing work for the home member firm). However, as a default, any ongoing international assignment/ move allowances and benefits will cease if the associated cost does not continue (e.g., Cost-of-living allowance, GO daily allowance, location allowance – see relevant sections in this policy).
Additional costs incurred by the assignee/ individual (e.g., travel, temporary accommodation, immigration) may be reimbursed (or not) at the sole discretion of KPMG based on the reason for the temporary suspension and whether they are reasonable in the circumstances. Therefore, the assignee/ individual should seek clarification from KPMG before incurring such expenses as it should not be assumed that they will be reimbursed. Also, as a default, ‘one-off’ relocation benefits will not be provided a second time (e.g., shipping, destination services, time off upon arrival, relocation payment, accompanying souse/domestic partner allowance, cross cultural training – see relevant sections in this policy).
This section applies if there is a suspension or relocation (as outlined above) for any reason whatsoever (e.g., emergency situation per sections 2.3.7, 3.3.6, 4.3.10 and 5.3.11).
The remainder of this section outlines when repayment clauses can, and cannot, be used, and the parameters that apply to the alternatives.
For purposes of this section, the following definitions are applicable:
1. Localization;
2. Resignation/termination;
3. Early repatriation;
4. Extension of the international assignment; and
5. Temporary suspension of the international assignment.
Consider the default position that no repayment clauses are to be used. If it is deemed appropriate to nevertheless utilize a repayment/claw-back provision, such terms must be agreed, in writing, by the relevant parties before the start of the international assignment or at the time of assignment extension (it must be included in the assignee’s T&C letter – see section 1.3.2). The relevant parties are the assignee, the home member firm, and the host member firm.
Localization
Resignation/termination
There are no differences in the application of this policy sub-section should the localization occur during or after the international assignment.
However, the assignee may be required to repay any non-assignment compensation (e.g., salary) to the home member firm due to the termination of the home member firm employment/ partnership relationship as part of a ‘domestic home policy.’ Under no circumstances will such domestic home policies apply due to the international assignment. Any such payments will result from an assignee's underlying employment/ partnership contract that existed before the international assignment began or are invoked during the international assignment as part of the standard operating practice within the home member firm. Any such domestic home policy repayment clauses are entirely the responsibility of the assignee. The assignee must disclose the existence of any applicable policy clauses to the host member firm before the start of the international assignment.
Although not directly related to the assignee, there may also be repayment implications between the home and host member firms due to localization. While the default position remains that there are no repayments, there are two options that may be agreed, in writing, before the start of the international assignment:
a) The host member firm reimburses the home member firm for home member firm’s ‘international assignment investment' in the assignee (assignment-related allowances and benefits borne by the home member firm based on the agreed cost-sharing arrangement); and/or
b) The host member firm reimburses the home member firm for home country employer contributions (related to employee benefit plans and/or social security payments).
Under no circumstances may the home member firm ask the host member firm to reimburse the cost of replacing the assignee with another individual.
There are no repayment implications for the assignee explicitly related to the international assignment.
This subsection applies when the assignee resigns due to a personal choice (e.g., they secure new employment with a non-KPMG organization). It does not apply when they resign due to no fault of their own (e.g., on medical grounds) or when the assignee’s employment is terminated by KPMG – both of which carry no repayment implications.
When the assignee resigns due to personal choice, the default position remains, which are no repayment requirements. However, each member firm has the option to apply a repayment clause if such a resignation occurs within a pre-determined period, which should be set by the member firm and communicated in advance, in writing, to both assignee (by including it in the T&C letter) and host member firm. The default duration is up to a maximum of twelve months, though for long-term international assignments a longer term may apply by mutual agreement.
Where the assignee resigns by choice and a repayment clause has been documented in writing, the assignee may be asked to reimburse the home member firm for its ‘international assignment investment' (assignment-related allowances and benefits borne by the home member firm based on the agreed cost-sharing arrangement). The specific international assignment allowances and benefits subject to repayment must be detailed in the T&C letter.
Other than the international assignment-related allowances and benefits (as stated above), the home member firm cannot include any repayment clauses related to the international assignment in the employee’s assignment terms. This includes, but is not limited to:
There are no repayment implications for any stakeholders if the host member firm terminates the international assignment early.
The only potential repayment implication for the assignee occurs where he/she decides to end the international assignment early due to personal choice, within six months of the start of a long-term international assignment.
Any repayment clause must be included in the assignee’s T&C letter agreed before the start of the international assignment.
1. The home firm has the discretion to reduce/eliminate repatriation allowances and benefits (e.g., to provide only the ‘bare minimum’ such as economy class flight and excess baggage only).
2. The host member firm has the right to claim reimbursement for any pre-assignment and relocation costs it has funded (as specified in the T&C letter) either from:
However, the home member firm may apply any ‘domestic home policy’ due to the resignation (see the ‘Localization’ sub-section above for more details).
There are no repayment implications between the home and host member firms in the event the employee resigns by choice from the firm.
Non-international assignment compensation and benefits (e.g., salary);
Employer contributions to employee benefit plans and/or social security; and
The cost of replacing the assignee with another individual.
Early repatriation
a) The home member firm (which may, at its sole discretion, require the assignee to reimburse the costs in part or in full); or
Regarding item 2a above, if there are additional costs associated with the home member firm reimbursing the host member firm instead of the assignee (e.g., withholding taxes), the home member firm must bear those costs as well (the home member firm may also choose to pass these costs onto the assignee).
Should the host member firm wish to claim repayment in the event of an early repatriation, the details must be determined before the start of the international assignment and stipulated in writing. Any claim of repayment from the home member firm must be included in the CSA and any claim on the assignee (whether from the host member firm or home member firm) must be included in the assignee’s T&C letter.
Should the home member firm decide to terminate a long-term international assignment within the initial six months, or should the assignee terminate the assignment through no fault of their own (e.g., on medical grounds), there may be repayment implications for the home member firm. The default position remains no repayment clauses. Other terms may be applicable where included in a cost-sharing agreement at the start of the assignment.
If agreed in the cost sharing agreement, the home member firm may be asked to reimburse the host member firm for the Relocation costs (some or all), in the event of an involuntary assignment termination.
There are no repayment implications anticipated as part of an international assignment extension agreement.
The cost-sharing agreement (CSA), and potentially the assignee’s compensation package, can be amended for the international assignment extension period.
b) The assignee directly.
Extension of the international assignment
As with extensions, there are no repayment implications anticipated as part of a temporary suspension of an international assignment.
The assignee’s international assignment-related compensation package and the cost-sharing agreement may be amended for the suspension period. In such circumstances, the temporary changes are prospective and therefore neither the host nor home member firm can retrospectively claim a repayment from the assignee (or the other member firm).
This policy may be wholly or partially amended or otherwise modified at the sole discretion of KPMG for reasons including, but not limited to, changes in law.
Temporary suspension of the international assignment
1.3.6 Amendments to policy
Short-Term International Assignment
2
2.1 Overview
2.1.1 Compensation package
Pay delivery
2.1.2 Duration
Compensation adjustments: host country minimum requirements
The compensation package aims to maintain home country compensation (‘home-based methodology’ – see section 1.2.2), which is supplemented by a range of assignment-related allowances and benefits for relocation, during the international assignment and repatriation to the home country. The package is designed such that the assignee is broadly not advantaged nor disadvantaged financially as a result of the international assignment.
As a default, the assignee’s pay is delivered via the home country payroll (active payroll). It may also be necessary to operate a shadow payroll in the host country if there are remittance requirements (e.g., employee benefit plans, income tax and social security).
Host country minimum compensation provisions may be required by law (e.g., immigration), requiring that the assignee is paid more than would otherwise be provided by implementing the home-based compensation methodology. In such circumstances, adjustments could be made to some international assignment allowances and benefits to ensure the overall compensation package remains as close as possible to the standard short-term international assignment compensation package arrangement.
The standard duration is between three and twelve months. Temporary international moves of less than three months are defined, as a default, as international business trips and are outside the scope of this policy.
International assignments of more than twelve months are classified as ‘long-term’ (see sections 3, 4 and 5).
Any grade/level of KPMG personnel, including employees and partners are eligible for this international assignment type.
An integral element of the home-based compensation package is the ‘home-basis tax Approach’ (see section 2.6.1), the objective of which is to ensure that an assignee does not bear the cost of significantly more or less income tax or social taxes on KPMG compensation as a result of the international assignment.
2.1.3 Grade-level
2.1.4 Family
These international assignments are only offered on single status (unaccompanied basis). Therefore, no expense reimbursements, or any other support, will be provided for family members should they choose to accompany the assignee in the host country location for the international assignment.
2.2.2 Incentive compensation
2.2.3 Employee benefits
The assignee will usually remain eligible for the incentive compensation plans offered in the home location (home-country basis). However, the assignee’s performance during the international assignment in the host location would be utilized for any plans that assess individual performance. The assignee’s work location in the host country should not negatively impact entitlement to home firm incentive compensation.
The assignee continues to participate in the benefits package in the home location (home-country basis) for both short-term and long-term employee benefits. When necessary, alternative arrangements will be made (to continuing participation in home country benefits), between the home and host member firms, with the aim to leave the assignee broadly no better or worse off. Examples of when the default position would have to be amended include, but are not limited to:
Changes to benefit provision may include discontinuing certain provisions, providing substitute plans (e.g., international medical insurance) or providing supplemental benefits.
This is provided using a home-country basis, whereby the assignee will continue to receive his or her pre-assignment base salary in the home location throughout the international assignment, subject to reviews where applicable.
If the assignee must be paid via host country payroll, the assignee will be kept substantially ‘whole’. This is achieved by providing the assignee with a salary expressed in host country currency. The actual value of this salary restated in home country currency will fluctuate with the exchange rate and therefore, at the discretion of the firm, the assignee may be compensated for this fluctuation and/or reimburse the assignee for reasonable bank transfer fees.
2.2 Compensation and benefits
2.2.1 Base salary
If it is not possible to continue to provide a particular benefit to an assignee (e.g., country legal restrictions do not allow participation by a non-resident so he or she is ineligible); and
An existing benefit is insufficient/invalid due to the assignee living in the host location.
See Appendix B for a categorization of short-term and long-term employee benefits and section 1.2.2 regarding the refund of any host-country KPMG-funded contributions.
The assignee is provided a GO daily allowance for each calendar day while on international assignment to contribute towards any additional cost incurred in living away from home. The allowance begins on the start date of the international assignment (excluding the day of relocation travel) and stops at the international assignment end date (again excluding the repatriation travel day).
The assignee may not be provided the GO daily allowance for days spent in the home country (e.g., during a business trip or time off), based on host member firm policy.
The rate of the GO daily allowance is set by the host member firm, utilizing a standard global data source and methodology.
The policies follow either home-country or host-country policy, as outlined in the table below:
2.2.4 Working hours and time off
2.3.2 Housing
1. Subject to the laws and regulations of the host country; and business approval by the host member firm if such costs are borne by them
2. Although scheduling of time off requires host country approval
3. Excludes elements outlined in this policy
4. Home policy followed as a default, subject to the laws and regulations of the host location
2.3 On-going international assignment allowances and benefits
2.3.1 GO daily allowance
The housing benefit provided assumes the assignee has on-going housing costs in the home country and is based on host member firm policy including the following:
Furnished accommodation is provided, if possible, to avoid the costs of securing furniture.
The value of the housing provided is based on pre-determined parameters considering location and the grade/level of the assignee.
Whether it is single or shared occupancy.
Business needs for the assignee’s role in the host location; and/or
If the assignee is deemed to be significantly disadvantaged (e.g., insurance or car leases are unobtainable/prohibitively expensive) by being an assignee.
Continues to receive a transportation benefit as part of home-country compensation, such as a company car or transportation allowance (to avoid duplicate provision); or
Has taken a car to the host location.
The effective method of providing housing arrangements (e.g., provision of firm-owned property, serviced accommodation, rented property with a lease in the name of the host member firm or the assignee, with either a direct payment to a third party or, rarely, provision of a cash allowance to the assignee,).
The housing benefit is designed to cover rent and utility costs (and other ongoing elements such as appliances if not standard in host location) but will exclude other costs (e.g., domestic help and gardening services).
Other housing aspects
KPMG does not support assignees purchasing housing in the host location as there are often complicated tax and legal consequences, and a large capital investment in the host location is likely to reduce the assignee’s mobility in the future. Assignees may not purchase property in the host country with the firm-provided housing allowance or subsidy/contribution. Therefore, should the assignee purchase housing in the host country this housing benefit will be forfeited.
The benefit may be in the form of a car (e.g., fleet car, lease, rental, etc.), to reimburse the assignee for costs, or via an allowance. Also, there may be no assistance for host country transportation if there is no such benefit provided by the host member firm per their compensation policies.
Provision of assistance for transportation in the host location will be based on host firm member policy, considering:
The provision of any host country transportation benefit may be amended/withdrawn if the assignee:
2.3.3 Host country transportation
Operating expenses (such as insurance, maintenance, and fuel) during KPMG business will be reimbursed via the host country expense system.
Home leave trips are provided to help assignees maintain internal and external connections in the home country and facilitate reintegration if they away for a prolonged period during international assignment. Therefore, due to the limited duration of many short-term international assignments a home leave trip is not always necessary as outlined below:
The assignee’s home leave benefit may be swapped for one dependent family member to travel to host location, limited to transportation only up to the cost of the assignee’s home leave trip, with any additional tax liability resulting from the family visiting will be for the assignee’s account.
When provided, the standard home leave benefit is:
Other aspects are:
2.3.4 Home leave
a. The home leave trip can be taken at any time during the international assignment; however.
b. Whenever possible, the home leave trip should be combined with a business trip.
Economy class travel (air/train) by the most direct route (no stopovers);
Reasonable baggage charges will be reimbursed per home member firm policy;
Ground transportation to and from airports/stations;
The home leave benefit does not allow assignees to visit other locations in lieu of the home location;
No cash alternative for any home leave trips not taken;
Time off charged to the assignee’s vacation/annual leave eligibility; and
Reasonable travel time charged to ‘working hours’ (up to one day in each direction).
Booking needs to be arranged via the KPMG-appointed travel agent (where applicable).
To be eligible for a home leave trip, the assignee may be required, at the discretion of the home member firm, to physically visit the home country office and/or meet his or her performance manager in person; and maintain any required career/performance data or systems (per home member firm policy).
The assignee must obtain pre-approval from both the host member firm and home member firm regarding the scheduling of home leave (and the cost from the member firm bearing the cost). In general, home leave should not be arranged in the first three and last three months of the international assignment in the absence of compelling circumstances (although such restrictions should not prevent the assignee from taking home leave).
All home country professional licensing fees, memberships, etc., will continue to be subject to the home member firm policies throughout the international assignment. Conversely, any qualifications, licenses, etc., required by the laws and/or regulations of the host country will follow the policies of the host member firm.
2.3.5 Professional memberships/ licensing
All home country and host country training requirements will be governed by the policies of the respective member firms throughout the international assignment.
2.3.6 Training
An emergency leave benefit is provided for either compassionate reasons or other reasons per the table below:
The benefit, for both categories above, includes:
2.3.7 Emergency leave
Economy class travel (air/train) by the most direct route (no stopovers);
Ground transportation to and from airports/stations;
Excess baggage charges will not be reimbursed; and
Time off is granted per host country policy (including scheduling).
2.4 Pre-assignment and relocation
2.4.1 Immigration
2.4.2 Medical exams and inoculations
KPMG will bear the cost of expenses related to immigration compliance for the assignee, for example: visas, work permits, notarization or certification of documents, background checks and travel expenses to consular offices.
In some countries there is a requirement for a medical examination/certification and/or inoculations (e.g., as part of the immigration process). Assignees may also choose to undergo such procedures voluntarily, as part of the move to the host country based on specific individual and/or international assignment circumstances.
2.4.3 Assignment orientations
An assignment orientation provides an opportunity to manage assignee expectations, disseminate important information, and help address any concerns. There are two different types of assignment orientation: an outbound (in the home country) and an inbound (in the host country), both conducted by respective GMPs.
They can be conducted in person (preferably) or virtually, with the outbound one ideally conducted prior to departure, the inbound as soon as possible at the start of the international assignment. The orientations should include discussion on a variety of topics, examples of which are outlined below:
However, the cost of a passport or other regular travel documents are the responsibility of the assignee.
KPMG will reimburse reasonable costs not covered by insurance.
Assignees must comply with all applicable immigration laws and regulations and must not depart from their home country until clearance has been provided by the host member firm.
2.4.4 Security briefing
2.4.5 Travel to the host location
Other specialists — such as benefits or payroll experts, for example — should attend the orientations when possible. There is generally a separate tax briefing conducted by a KPMG tax professional (see section 2.6.2).
The assignee should have a security briefing when this is considered necessary (e.g., the host country is considered a high-risk location), prior to departure. The briefing will be conducted by internal security resources or the firm-designated security organization (International SOS at the time of writing).
The host country will decide upon the most practical and cost-effective way to travel to the host location. The standard mode of transportation for assignees is air travel but the host member firm may approve alternatives (e.g., train or assignee’s own car) where practical and cost-effective.
Economy class tickets should be booked for air and train travel. When travelling by air it should be via the most direct route (no stopovers) and round-trip tickets where appropriate.
Reasonable travel time can be charged to ‘working hours’ (up to one day). Travel time should still be charged, as a default, to the home member firm.
Other travel arrangements should be made per the host member firm business travel policy, including ground transportation to and from airports/station, or mileage allowances, and subsistence expenses.
Other resources and information
The firm-designated security organization provides emergency medical and security assistance to all KPMG professionals traveling internationally (including assignees). Online resources are available, and all assignees are urged to take advantage of the material published and obtain KPMG’s membership details. Note that these services are for emergencies only, as duly authorized by KPMG, and are not, therefore, a substitute for individual medical and accident insurance.
Travel insurance
Assignees should be provided travel insurance, which would typically be arranged automatically when travel arrangements are made via the relevant member firm designated travel system (e.g., when booking flights). If travel insurance is not automatically provided, it is the home member firm’s responsibility to arrange it. However, if any assignee does not book travel with the firm-designated travel system/ provider they are responsible for both arranging for, and bearing the costs of the travel insurance.
Border control travel costs
Related mandatory border-control costs (required by the host country laws and regulations) will, as a default, be borne by KPMG. These costs may be imposed on a temporary basis by the host country (in response to an emergency situation) or be a long-term standard arrangement. However, the assignee should not incur such expenses and expect them to be reimbursed without prior pre-approval, which will be based on host member firm policy.
For short-term international assignments the default position is the host member firm arranges the housing for the assignee (see section 2.3.2). If, however, the assignee is required to secure his or her own housing, the following services and benefits will be provided, based on host member firm policy (if applicable, and subject to limitations):
The assignee is allowed to claim excess baggage expenses up to a maximum set by the host member firm.
The assignee cannot claim for any other related costs, including but not limited to air or surface shipment, storage, and shipment of pets.
2.4.6 Transportation of personal belongings
2.4.7 Securing host country housing
Excess baggage
Other costs (not provided)
Fees for securing host country housing (including obtaining a lease), and set-up (such as connection of utilities); and
Deposits (e.g., first/ last month’s rent) that are necessary to secure the rented property (which must be repaid by the end of the international assignment).
Assignees must not travel to the host country until immigration clearance has been provided by the host member firm (see section 2.4.1).
2.4.8 Time off upon arrival
In addition to travel time (see section 2.4.5), one business day’s paid leave is granted to help the assignee settle into the host location. Time off should be charged, as a default, to the host member firm and must be taken within the first three months of the international assignment start-date.
2.4.9 Cross cultural training
KPMG retains the services of a specialist cross-cultural awareness organization (Culture Wizard at the time of writing) to provide online resources that are available to the assignee, including host country information. Assignees are strongly encouraged to access the materials online, which have been pre-paid by KPMG.
2.5 Repatriation
See section 1.3.2 regarding relevant policy application for repatriation provisions.
Travel insurance
Assignees should be provided travel insurance, which would typically be arranged automatically when travel arrangements are made via the relevant member firm designated travel system (e.g., when booking flights). If travel insurance is not automatically provided, it is the home member firm’s responsibility to arrange it. However, if any assignee does not book travel with the firm-designated travel system/ provider they are responsible for both arranging for, and bearing the costs of the travel insurance.
Border control travel costs
Related mandatory border-control costs (required by the home country laws and regulations) will, as a default, be borne by KPMG. These costs may be imposed on a temporary basis by the home country (in response to an emergency situation) or be a long-term standard arrangement. However, the assignee should not incur such expenses and expect them to be reimbursed without prior pre-approval, which will be based on home member firm policy.
2.5.1 Travel to the home location
The mode of travel to the host country at the beginning of the international assignment (see section 2.4.5) is applicable when the assignee returns home (including utilizing the return tickets of a round-trip booking, where appropriate).
Other travel arrangements should be made per the home member firm business travel policy, including ground transportation to and from airports/station, or mileage allowances, and subsistence expenses.
If new travel arrangements are required, economy class tickets should be booked for air and train travel. When travelling by air it should be via the most direct route (no stopovers).
Reasonable travel time can be charged to ‘working hours’ (up to one day). Travel time should be charged, as a default, to the host member firm.
CHECK DIVIDER LINE RULE
2.5.2 Transportation of personal belongings
2.5.3 Time off upon arrival
2.6 Taxation and social security/ insurance
2.6.1 Tax policy
The assignee is allowed to claim excess baggage expenses up to a maximum set by the home member firm.
The assignee cannot claim for any other related costs, including but not limited to air or surface shipment, storage, and shipment of pets.
In addition to travel time (see section 2.5.1), one business day’s paid leave is granted to help the assignee settle back into the home location. However, time off should be charged, as a default, to the home member firm and must be taken within the first three months of the international assignment end-date.
As KPMG utilizes two alternative compensation philosophies for international assignments (home-based and host-based – see section 1.2.1), there are two corresponding tax policy approaches: the ‘home-basis tax approach’ and the ‘host-basis tax approach’.
KPMG’s Global Mobility Services department (GMS) provides tax compliance services to the firm’s assignees. The services include the following (as applicable):
As short-term assignees are provided home-based compensation, KPMG also adopts the home-basis tax approach.
The objective of the home-basis tax approach is to ensure that an assignee does not pay substantially more or less tax on KPMG compensation than he or she would have paid had the assignee remained working in the home country.
Excess baggage
Other costs (not provided)
2.6.2 Tax compliance services
Tax briefing sessions, in both the home country and host country, at the start of the international assignment and again before repatriation;
Preparation of host country and home country tax returns, where necessary (including any necessary ancillary services such as extensions);
Preparation of tax settlement calculations (if necessary);
Handling of inquiries from taxing authorities that impact tax on the assignee's KPMG compensation related to the international assignment; and
Assistance with audits/examinations/notices issued by tax authorities relating to KPMG compensation.
2.6.3 Social security/ insurance
As part of the ‘home-basis tax approach’ (see section 2.6.1) the assignee’s responsibility regarding costs is limited to the equivalent of the amount that would be payable had the international assignment not taken place (‘hypothetical social taxes on stay-at-home KPMG compensation’).
KPMG is responsible for the worldwide employee social taxes (host country and home country) in excess of the assignee’s responsibility (hypothetical taxes) on all the assignee’s KPMG compensation.
Any voluntary employee contributions made by the assignee into either the home country or host country systems are entirely his or her responsibility.
Employee costs
Host-Peer (Employees) International Assignment
3
3.1 Overview
3.1.1 Compensation package
Pay delivery
3.1.3 Grade-level
3.1.2 Duration
The compensation package offered is a host-based methodology (see section 1.2.2), which is supplemented by a range of international assignment-related allowances and benefits for relocation, during the international assignment and repatriation to the home country. The package is designed to provide the assignee with a similar standard of living in the host country enjoyed by his or her local peers.
As a default the assignee’s pay is delivered via the host country payroll (active payroll). It may also be necessary to operate a shadow payroll in the home country if there are remittance requirements (e.g., employee benefits, income tax and social security).
The minimum duration for this international assignment type is one year; with a maximum duration of five years (including extensions).
International assignments of less than one year are defined as short-term (see section 2). If the assignee were to remain in the host country for more than five years, he or she may be subject to localization provisions.
Any grade/level of employee are eligible for this international assignment type. For partners (and potentially one grade below partner) see sections 4 and 5.
These international assignments are offered on either a single (unaccompanied) or accompanied basis. For accompanied status, expense reimbursements and other support, will be provided for only dependent family members to accompany the assignee in the host country location for the international assignment. Also see section 1.2.3.
No provisions apply to dependents remaining in the home country unless specifically stated in the remainder of this section.
An integral element of the host-peer package is the ‘host-basis tax approach’ (see section 3.6.1); the objective of which is to ensure that an assignee does not bear the cost of any income tax or social taxes on international assignment-related allowances and benefits and has a comparable net pay (excluding international assignment allowances and benefits) as host-country peers.
3.1.4 Family
3.2 Compensation and benefits
3.2.1 Base salary
3.2.2 Incentive compensation
3.2.3 Employee benefits
The assignee will receive a salary as offered by the host member firm based on its standard policies and practice for local employees (‘host-peer basis’), considering the individual’s experience and responsibilities. Increases in the host base compensation during the international assignment would be implemented as part of the standard performance and pay review in the host member firm.
The assignee will, as a default, be eligible for the incentive compensation plans offered in the host location (host-peer basis), in lieu of home-country plans.
For the provision of employee benefits, there is a distinction between the following:
See Appendix B for a categorization of short-term and long-term employee benefits.
When necessary, alternative arrangements will be made (to the default position as stated in the table above), between the home and host member firms, with the aim to leave the assignee broadly no better or worse off. Examples of when the default position would have to be amended include, but are not limited to:
During the first and last years of an international assignment, the assignee will work for the host and home member firms for part of the performance year. Based on the start/end date, and the incentive compensation policies in the home and host member firms, the assignee could be detrimentally affected in terms of eligibility. Ideally the assignee should receive a pro-rata portion of incentive compensation from each member firm, based on respective policies, for the period of the year worked for each firm. Where this is not possible (e.g., due to plan rules), the respective member firm(s) may, at its sole discretion decide to provide an alternative payment in lieu of the incentive compensation.
If it is not possible to continue to provide a particular benefit to an assignee (e.g., country legal restrictions do not allow participation by a non-resident so he or she is ineligible);
An existing home country benefit is insufficient/invalid due to the assignee living in the host location; and
1 INTRODUCTION
2 SHORT-TERM INTERNATIONAL ASSIGNMENT
3 HOST-PEER (EMPLOYEES) INTERNATIONAL ASSIGNMENT
APPENDIX A – DEFINITIONS
APPENDIX B – EMPLOYEE BENEFITS – SHORT TERM AND LONG TERM
APPENDIX C – SHIPPING & FURNITURE ALLOWANCE – ITEMS INCLUDED/ EXCLUDED
4 HOST-PEER (PARTNERS) INTERNATIONAL ASSIGNMENT
5 HOME-EQUALIZED INTERNATIONAL ASSIGNMENT
6 PERSONAL TEMPORARY INTERNATIONAL MOVE
2.1 OVERVIEW
2.3 ON-GOING INTERNATIONAL ASSIGNMENT ALLOWANCES AND BENEFITS
2.2 COMPENSATION AND BENEFITS
2.4 PRE-ASSIGNMENT AND RELOCATION
2.5 REPATRIATION
2.6 TAXATION AND SOCIAL SECURITY/ INSURANCE
2.1 OVERVIEW
2.1.1 Compensation package
2.1.2 Duration
2.1.3 Grade-level
2.1.4 Family
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2.2 COMPENSATION AND BENEFITS
2.2.1 Base salary
2.2.2 Incentive compensation
2.2.3 Employee benefits
2.2.4 Working hours and time off
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2.3 ON-GOING INTERNATIONAL ASSIGNMENT ALLOWANCES AND BENEFITS
2.3.1 GO daily allowance
2.3.2 Housing
2.3.3 Host country transportation
2.3.4 Home leave
2.3.5 Professional memberships/ licensing
2.3.6 Training
2.3.7 Emergency leave
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2.4 PRE-ASSIGNMENT AND RELOCATION
2.4.1 Immigration
2.4.2 Medical exams and inoculations
2.4.3 Assignment orientations
2.4.4 Security briefing
2.4.5 Travel to the host location
2.4.6 Transportation of personal belongings
2.4.7 Securing host country housing
2.4.8 Time off upon arrival
2.4.9 Cross cultural training
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2.5 REPATRIATION
2.5.1 Travel to the home location
2.5.2 Transportation of personal belongings
2.5.3 Time off upon arrival
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2.6 TAXATION AND SOCIAL SECURITY/ INSURANCE
2.6.1 Tax policy
2.6.2 Tax compliance services
2.6.3 Social security/ insurance
1.1 POLICY SCOPE AND CONTEXT
1.1.1 Types of international moves
1.1.2 GO Program Vs specific global mobility programs
1.1.3 International assignments and personal temporary international move
1.1.4 Policy application
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1.2 COMPENSATION STRUCTURE AND METHODOLOGY
1.2.1 Compensation categories
1.2.2 Compensation basis
1.2.3 Family and accompanied status
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1.3 POLICY ADMINISTRATION AND GOVERNANCE
1.3.1 Policy owner
1.3.2 Policy implementation and interpretation
1.3.3 International assignment structure: secondment and relocation
1.3.4 Policy disclaimers
1.3.5 Repayment clauses
1.3.6 Amendments to policy
1.1 POLICY SCOPE AND CONTEXT
1.2 COMPENSATION STRUCTURE AND METHODOLOGY
1.3 POLICY ADMINISTRATION AND GOVERNANCE
3.1 OVERVIEW
3.1.1 Compensation package
3.1.2 Duration
3.1.3 Grade-level
3.1.4 Family
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3.2 COMPENSATION AND BENEFITS
3.2.1 Base salary
3.2.2 Incentive compensation
3.2.3 Employee benefits
3.2.4 Working hours and time off
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3.3 ON-GOING INTERNATIONAL ASSIGNMENT ALLOWANCES AND BENEFITS
3.3.1 Host country transportation
3.3.2 Home leave
3.3.3 Children’s visits to the host country
3.3.4 Professional memberships/ licensing
3.3.5 Training
3.3.6 Emergency leave
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3.4 PRE-ASSIGNMENT AND RELOCATION
3.4.1 Immigration
3.4.2 Medical exams and inoculations
3.4.3 Assignment orientations
3.4.4 Security briefing
3.4.5 Travel to the host location
3.4.6 Transportation of personal belongings
3.4.7 Temporary living
3.4.8 Destination services
3.4.9 Securing host country accommodation
3.4.10 Time off upon arrival
3.4.11 Relocation payment
3.4.12 Accompanying spouse/domestic partner allowance
3.4.13 Cross cultural training
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3.5 REPATRIATION
3.5.1 Travel to the home location
3.5.2 Host country residence
3.5.3 Transportation of personal belongings
3.5.4 Temporary living
3.5.5 Time off upon arrival
3.5.6 Repatriation payment
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3.6 TAXATION AND SOCIAL SECURITY/ INSURANCE
3.6.1 Tax policy
3.6.2 Tax compliance services
3.6.3 Social security/insurance
3.1 OVERVIEW
3.2 COMPENSATION AND BENEFITS
3.3 ON-GOING INTERNATIONAL ASSIGNMENT ALLOWANCES AND BENEFITS
3.4 PRE-ASSIGNMENT AND RELOCATION
3.5 REPATRIATION
3.6 TAXATION AND SOCIAL SECURITY/ INSURANCE
4.1 OVERVIEW
4.1.1 Compensation package
4.1.2 Duration
4.1.3 Grade-level
4.1.4 Family
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4.2 COMPENSATION AND BENEFITS
4.2.1 Base salary
4.2.2 Incentive compensation
4.2.3 Employee benefits
4.2.4 Working hours and time off
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4.3 ON-GOING INTERNATIONAL ASSIGNMENT ALLOWANCES AND BENEFITS
4.3.1 Location allowance
4.3.2 Housing
4.3.3 Host country transportation
4.3.4 Children’s education assistance
4.3.5 Home leave
4.3.6 Rest and relaxation leave
4.3.7 Children’s visits to the host country
4.3.8 Professional memberships/ licensing
4.3.9 Training
4.3.10 Emergency leave
4.3.11 Club memberships
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4.4 PRE-ASSIGNMENT AND RELOCATION
4.4.1 Pre-assignment trip
4.4.2 Immigration
4.4.3 Medical exams and inoculations
4.4.4 Home country residence
4.4.5 Car disposal at home country
4.4.6 Assignment orientations
4.4.7 Security briefing
4.4.8 Travel to the host location
4.4.9 Transportation of personal belongings
4.4.10 Temporary living
4.4.11 Destination services
4.4.12 Securing host country accommodation
4.4.13 Time off upon arrival
4.4.14 Relocation payment
4.4.15 Accompanying spouse/ domestic partner allowance
4.4.16 Language training
4.4.17 Cross cultural training
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4.5 REPATRIATION
4.5.1 Car disposal at host country
4.5.2 Travel to the home location
4.5.3 Host country residence
4.5.4 Transportation of personal belongings
4.5.5 Temporary living
4.5.6 Home country residence
4.5.7 Time off upon arrival
4.5.8 Repatriation payment
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4.6 TAX AND SOCIAL SECURITY/ INSURANCE
4.6.1 Tax policy
4.6.2 Tax compliance services
4.6.3 Social security/ insurance
4.1 OVERVIEW
4.2 COMPENSATION AND BENEFITS
4.3 ON-GOING INTERNATIONAL ASSIGNMENT ALLOWANCES AND BENEFITS
4.4 PRE-ASSIGNMENT AND RELOCATION
4.5 REPATRIATION
4.6 TAX AND SOCIAL SECURITY/ INSURANCE
5.1 OVERVIEW
5.1.1 Compensation package
5.1.2 Duration
5.1.3 Grade-level
5.1.4 Family
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5.2 COMPENSATION AND BENEFITS
5.2.1 Base salary
5.2.2 Incentive compensation
5.2.3 Employee benefits
5.2.4 Working hours and time off
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5.3 ON-GOING INTERNATIONAL ASSIGNMENT ALLOWANCES AND BENEFITS
5.3.1 Cost of living allowance (COLA)
5.3.2 Location allowance
5.3.3 Housing
5.3.4 Host country transportation
5.3.5 Children’s education assistance
5.3.6 Home leave
5.3.7 Rest and relaxation leave
5.3.8 Children’s visits to the host country
5.3.9 Professional memberships/ licensing
5.3.10 Training
5.3.11 Emergency leave
5.3.12 Club memberships
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5.4 PRE-ASSIGNMENT AND RELOCATION
5.4.1 Pre-assignment trip
5.4.2 Immigration
5.4.3 Medical exams and inoculations
5.4.4 Home country residence
5.4.5 Car disposal at home country
5.4.6 Assignment orientations
5.4.7 Security briefing
5.4.8 Travel to the host location
5.4.9 Transportation of personal belongings
5.4.10 Temporary living
5.4.11 Destination services
5.4.12 Securing host country accommodation
5.4.13 Time off upon arrival
5.4.14 Relocation payment
5.4.15 Accompanying spouse/ domestic partner allowance
5.4.16 Language training
5.4.17 Cross cultural training
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5.5 REPATRIATION
5.5.1 Car disposal at host country
5.5.2 Travel to the home location
5.5.3 Host country residence
5.5.4 Transportation of personal belongings
5.5.5 Temporary living
5.5.6 Home country residence
5.5.7 Time off upon arrival
5.5.8 Repatriation payment
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5.6 TAXATION AND SOCIAL SECURITY/ INSURANCE
5.6.1 Tax policy
5.6.2 Tax compliance services
5.6.3 Social security/ insurance
5.1 OVERVIEW
5.2 COMPENSATION AND BENEFITS
5.3 ON-GOING INTERNATIONAL ASSIGNMENT ALLOWANCES AND BENEFITS
5.4 PRE-ASSIGNMENT AND RELOCATION
5.5 REPATRIATION
5.6 TAXATION AND SOCIAL SECURITY/ INSURANCE
6.1 OVERVIEW
6.1.1 Compensation package
6.1.2 Duration
6.1.3 Grade-level
6.1.4 Family
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6.2 COMPENSATION AND BENEFITS
6.2.1 Base salary
6.2.2 Incentive compensation
6.2.3 Employee benefits
6.2.4 Working hours and time off
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6.3 ON-GOING INTERNATIONAL MOVE ALLOWANCES AND BENEFITS
6.3.1 Host country transportation
6.3.2 Professional memberships/ licensing
6.3.3 Training
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6.4 PRE-MOVE AND RELOCATION
6.4.1 Immigration
6.4.2 Medical exams and inoculations
6.4.3 International move orientations
6.4.4 Security briefing
6.4.5 Travel to the host location
6.4.6 Transportation of personal belongings
6.4.7 Cross cultural training
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6.5 REPATRIATION
6.5.1 Travel to the home location
6.5.2 Transportation of personal belongings
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6.6 TAXATION AND SOCIAL SECURITY/ INSURANCE
6.6.1 Tax policy
6.6.2 Tax compliance services
6.6.3 Social security/ insurance
6.1 OVERVIEW
6.2 COMPENSATION AND BENEFITS
6.3 ON-GOING INTERNATIONAL MOVE ALLOWANCES AND BENEFITS
6.4 PRE-MOVE AND RELOCATION
6.5 REPATRIATION
6.6 TAXATION AND SOCIAL SECURITY/ INSURANCE
The split provision (‘short-term home’ and ‘long-term host’) results in either gaps or duplication in benefits.
One trip every twelve months for the assignee and the accompanying dependents;
Changes to benefit provision may include discontinuing certain provisions, providing substitute plans (e.g., international medical insurance), or providing additional benefits.
See section 1.2.2 regarding the refund of any host-country KPMG-funded contributions.
As a default, all working arrangements and time off follow host country policy, including, but not limited to annual leave/ personal time off/ vacation, public and company holidays, maternity/ paternity/ parental/ adoption leave, other paid or unpaid time off and working hours. This default position is subject to the laws and regulations of the host and home country, as appropriate.
Any outstanding leave balances accrued and remaining in the home country before the start of the international assignment are treated in accordance with home country policy (e.g., carrying over until repatriation, paying them out).
Provision of assistance for transportation in the host location will be based on host firm member policy applicable to local hires (‘host country basis’), as part of the short-term employee benefits package (see section 3.2.3), considering business needs for the assignee’s role in the host location.
The benefit may be in the form of a car (e.g., fleet car, lease, rental, etc.), to reimburse the assignee for costs, or via an allowance. However, there may be no assistance for host country transportation if there is no such benefit provided by the host member firm per their compensation policies.
Home leave trips are provided to help assignees maintain internal and external connections in the home country and facilitate reintegration. The standard home leave benefit is:
The provision of any host country transportation benefit may be amended/withdrawn if the assignee has taken a car to the host location.
Operating expenses (such as insurance, maintenance, and fuel) during KPMG business will be reimbursed via the host country expense system.
3.2.4 Working hours and time off
3.3.2 Home leave
3.3 On-going international assignment allowances and benefits
3.3.1 Host country transportation
Economy class travel (air/train) by the most direct route (no stop-overs);
One trip every twelve months;
Economy class round-trip travel (air/train) by the most direct route (no stopovers);
Ground transportation to and from airports/stations;
Excess baggage charges will not be reimbursed; and
No cash alternative for any visits not taken.
Booking needs to be arranged via the KPMG-appointed travel agent (where applicable).
To be eligible for a home leave trip, the assignee may be required, at the discretion of the home member firm, to physically visit the home country office and/or meet his or her performance manager in person; and maintain any required career/performance data or systems (per home member firm policy).
The assignee must obtain pre-approval from both the host member firm and home member firm regarding the scheduling of home leave (and the cost from the member firm bearing the cost). In general, home leave should not be arranged in the first three and last three months of the international assignment in the absence of compelling circumstances (although such restrictions should not prevent the assignee from taking the correct number of home leaves).
Reasonable baggage charges will be reimbursed per home member firm policy;
Ground transportation to and from airports/stations;
No cash alternative for any home leave trips not taken;
The home leave benefit does not allow assignees to visit other locations in lieu of the home location;
Time off charged to the assignee’s vacation/ annual leave eligibility; and
Reasonable travel time charged to ‘working hours’ (up to one day in each direction).
Other aspects are:
Dependent children under age 25 who are full-time students and remain in the home country during the international assignment are provided a benefit to visit the assignee in the host location. The benefit includes:
3.3.3 Children’s visits to the host country
3.3.4 Professional memberships/ licensing
All home country professional licensing fees, memberships, etc., will continue to be subject to the home member firm policies throughout the international assignment. Conversely, any qualifications, licenses, etc., required by the laws and/or regulations of the host country will follow the policies of the host member firm.
3.3.5 Training
All home country and host country training requirements will be governed by the policies of the respective member firms throughout the international assignment.
The benefit, for both categories above, includes:
3.3.6 Emergency leave
An emergency leave benefit is provided for either compassionate reasons or other reasons per the table below:
Economy class travel (air/train) by the most direct route (no stopovers);
Ground transportation to and from airports/stations;
Excess baggage charges will not be reimbursed;
Travel benefits provided to accompanying dependent family members as well as assignee; and
Assignee also granted time off per host country policy (including scheduling).
3.4 Pre-assignment and relocation
3.4.1 Immigration
3.4.2 Medical exams and inoculations
3.4.3 Assignment orientations
KPMG will bear the cost of expenses related to immigration compliance for the assignee and any accompanying dependents, for example: visas, work permits (for assignees only), notarization or certification of documents, background checks and travel expenses to consular offices.
However, the cost of a passport or other regular travel documents are the responsibility of the assignee.
In some countries there is a requirement for a medical examination/certification and/or inoculations (e.g., as part of the immigration process). Assignees, and accompanying dependents, may also choose to undergo such procedures voluntarily, as part of the move to the host country based on specific individual and/or international assignment circumstances.
An assignment orientation provides an opportunity to manage assignee (and accompanying dependents, if applicable) expectations, disseminate important information, and help address any concerns. There are two different types of assignment orientation: an outbound (in the home country) and an inbound (in the host country), both conducted by respective GMPs.
They can be conducted in person (preferably) or virtually, with the outbound one ideally conducted prior to departure, the inbound as soon as possible at the start of the international assignment. The orientations should include discussion on a variety of topics, examples of which are outlined below:
KPMG will reimburse reasonable costs not covered by insurance.
Assignees must comply with all applicable immigration laws and regulations and must not depart from their home country until clearance has been provided by the host member firm.
Other specialists — such as benefits or payroll experts, for example — should attend the orientations when possible. There is generally a separate tax briefing conducted by a KPMG tax professional (see section 3.6.2).
3.4.4 Security briefing
3.4.5 Travel to the host location
The assignee should have a security briefing when this is considered necessary (e.g., the host country is considered a high-risk location), prior to departure. The briefing will be conducted by internal security resources or the firm-designated security organization (International SOS at the time of writing).
The firm-designated security organization provides emergency medical and security assistance to all KPMG professionals traveling internationally (including assignees). Online resources are available, and all assignees are urged to take advantage of the material published and obtain KPMG’s membership details. Note that these services are for emergencies only, as duly authorized by KPMG, and are not, therefore, a substitute for individual medical and accident insurance.
The host country will decide upon the most practical and cost-effective way to travel to the host location. The standard mode of transportation for assignees (and accompanying dependents, where applicable) is air travel but the host member firm may approve alternatives (e.g., train or assignee’s own car) where practical and cost-effective.
Economy class tickets should be booked for air and train travel. When travelling by air it should be via the most direct route (no stopovers) and round-trip tickets where appropriate.
Reasonable travel time can be charged to ‘working hours’ (up to one day). Travel time should be charged, as a default, to the home member firm.
Other travel arrangements should be made per the host member firm business travel policy, including ground transportation to and from airports/station, or mileage allowances, and subsistence expenses.
Other resources and information
3.4.6 Transportation of personal belongings
3.4.7 Temporary living
Assignees must not travel to the host country until immigration clearance has been provided by the host member firm (see section 3.4.2).
Assignees should be provided travel insurance, which would typically be arranged automatically when travel arrangements are made via the relevant member firm designated travel system (e.g., when booking flights). If travel insurance is not automatically provided, it is the home member firm’s responsibility to arrange it. However, if any assignee does not book travel with the firm-designated travel system/ provider they are responsible for both arranging for, and bearing the costs of the travel insurance.
Travel insurance
Related mandatory border-control costs (required by the host country laws and regulations) will, as a default, be borne by KPMG. These costs may be imposed on a temporary basis by the host country (in response to an emergency situation) or be a long-term standard arrangement. However, the assignee should not incur such expenses and expect them to be reimbursed without prior pre-approval, which will be based on host member firm policy.
Border control travel costs
Excess baggage expenses for the assignee will be paid by the firm for up to two pieces of luggage, less any baggage allowance provided with the assignee’s airline ticket. So, if the airline free allowance for the assignee is one checked bag, excess baggage expenses can be claimed for one piece of luggage. This applies whether the assignee is single or accompanied. Excess baggage costs are also subject to a maximum set by the host member firm.
The temporary living period is for up to two weeks, which encompasses time spent both:
Excess baggage
After moving out of the home residence but before departure from the home country; and
After arrival in the host country but before permanent accommodations are available (e.g., rental lease has not started or because the assignee’s furniture shipment has yet to arrive).
3.4.8 Destination services
Temporary accommodation will be provided for the assignee and accompanying dependents (if applicable).
The type of accommodation provided is based on host member firm policy (such as a hotel or serviced apartment).
These services are available only once during an international assignment.
A GO Daily Allowance is paid to the assignee for each calendar day throughout the temporary living period to compensate for the additional costs of living in temporary accommodation. The rate of the allowance is set by the host member firm, using a standard global data source and methodology, utilizing the following criteria:
In addition to information provided during the onboarding process in the host member firm, the assignee may also be provided services by a firm-designated service provider.
These services are provided to assist in settling into the host location, where the assignee does not have same access to market as locals, and required to make their own housing arrangements, etc.
Examples of the provided services includes finding and securing accommodation (including type of lease), connection of utilities, setting up bank accounts, introduction to social organizations, orientation to the public transportation system, shopping places, healthcare providers, etc.
The provision of these services is based on host member firm policy, which will set parameters such as
Accommodation/lodging
Meals and incidentals
Family size (separate rates are applied to children up to twelve years old);
Designated time spent with representatives (up to a maximum of one business week, but could be less);
Applicable fees (including caps); and
Services to be provided.
Host location; and
Type of temporary accommodations (e.g., whether there are kitchen facilities).
3.4.9 Securing host country accommodation
3.4.10 Time off upon arrival
This benefit is available only once during the international assignment.
Assistance in securing host country housing is included as part of the destination services benefit (see section 3.4.8).
In addition to travel time (see section 3.4.5), one business week (usually five days) paid leave is granted to help the assignee settle into the host location. However, time off should be charged, as a default, to the host member firm. The assignee may take these days immediately or when moving into permanent accommodations, if this is later, or a combination of both, but must be taken within the first three months of the international assignment start-date.
3.4.11 Relocation payment
As each international assignment is unique the costs incurred by a given assignee will vary based on the particular facts and circumstances. This relocation payment is intended to be applied to any costs incurred in moving to and settling into the host location that are not specifically addressed by other elements of this policy.
This one-time allowance is provided to any assignee who is accompanied by his or her spouse/domestic partner to settle into the host location (e.g., towards the costs of pursuing professional careers, resuming education or engaging in volunteer activities).
The relocation payment is a fixed one-time allowance paid in host currency. The host member firm uses a standard global data source and methodology to determine the relocation payment, which considers the following factors when producing the data:
3.4.12 Accompanying spouse/domestic partner allowance
Services
Any benefit provided to the assignee associated with fees for securing host country housing (including obtaining a lease), and set-up (such as connection of utilities), is based on the policy in place at the time of the host member firm. This includes predetermined criteria (such as cost limitations) and usually only provided when such fees are habitually required to secure housing.
Fees
Assignee grade-level;
Host location; and
Family size.
The standard allowance is USD 3,000 (or host country equivalent). The assignee is not required to provide receipts to qualify for the allowance.
See section 1.3.2 regarding relevant policy application for repatriation provisions.
This allowance will still be paid when the spouse/domestic partner has secured a role in the host member firm as a local hire. Conversely, the allowance will not be paid if he or she is also an assignee with KPMG or another organization; nor when the spouse/domestic partner is provided a personal temporary international move (see section 6).
Payment of this allowance should not be withheld if the spouse/ domestic partner has to delay relocation to the host country and/or repatriate early (e.g., due to career, children’s schooling needs). However, to qualify for the allowance, the spouse or domestic partner must be in the host country with the assignee for the vast majority of the international assignment.
KPMG retains the services of a specialist cross-cultural awareness organization (Culture Wizard at the time of writing) to provide online resources that are available to the assignee, including host country information. Assignees are strongly encouraged to access the materials online, which have been pre-paid by KPMG.
The mode of travel to the host country at the beginning of the international assignment (see section 3.4.5) is applicable when the assignee returns home, and accompanying dependents where applicable, (including utilizing the return tickets of a round-trip booking, where appropriate).
Other travel arrangements should be made per the home member firm business travel policy, including ground transportation to and from airports/station, or mileage allowances, and subsistence expenses.
Assignees should be provided travel insurance, which would typically be arranged automatically when travel arrangements are made via the relevant member firm designated travel system (e.g., when booking flights). If travel insurance is not automatically provided, it is the host member firm’s responsibility to arrange it. However, if any assignee does not book travel with the firm-designated travel system/ provider they are responsible for both arranging for, and bearing the costs of the travel insurance.
Travel insurance
If new travel arrangements are required, economy class tickets should be booked for air and train travel. When travelling by air it should be via the most direct route (no stopovers).
Reasonable travel time can be charged to ‘working hours’ (up to one day). Travel time should be charged, as a default, to the host member firm.
3.4.13 Cross cultural training
3.5 Repatriation
3.5.1 Travel to the home location
Border control travel costs
Excess baggage
Related mandatory border-control costs (required by the home country laws and regulations) will, as a default, be borne by KPMG. These costs may be imposed on a temporary basis by the home country (in response to an emergency situation) or be a long-term standard arrangement. However, the assignee should not incur such expenses and expect them to be reimbursed without prior pre-approval, which will be based on home member firm policy.
The temporary living period is for up to one week, which encompasses time spent both:
The host member firm will assist with negotiating a lease break should the international assignment terminate early. Any fees or penalties charged for early lease break will be paid by the firm if it occurred due to business reasons. In addition, standard end-of-lease costs at the conclusion of the international assignment will be paid by the firm. The payment of the lease break and end-of-lease costs by KPMG is conditional on the assignee having fulfilled his or her responsibilities.
Excess baggage expenses for the assignee (and any accompanying dependents) will be paid by the firm for up to two pieces of luggage, less any baggage allowance provided with the assignee’s airline ticket. So, if the airline free allowance for the assignee is one checked bag, excess baggage expenses can be claimed for one piece of luggage. Excess baggage costs are also subject to a maximum set by the home member firm.
Accommodation/lodging
Temporary accommodation will be provided for the assignee and accompanying dependents (if applicable).
3.5.2 Host country residence
3.5.3 Transportation of personal belongings
3.5.4 Temporary living
After moving out of permanent accommodation but before departure from the host country; and
After arrival in the home country but before the home residence is available (e.g., tenants have not vacated the property or because the assignee’s furniture shipment has yet to arrive).
The type of accommodation provided is based on home member firm policy (such as a hotel or serviced apartment).
A GO Daily Allowance is paid to the assignee for each calendar day throughout the temporary living period to compensate for the additional costs of living in temporary accommodation. The rate of the allowance is set by the home member firm, using a standard global data source and methodology, utilizing the following criteria:
Meals and incidentals
Family size (separate rates are applied to children up to twelve years old);
Intended to be applied to any costs incurred in moving back to and resettling into the home location that are not specifically addressed by other elements of this policy;
A fixed one-time allowance paid in home currency; and
Determined by the home member firm, also using a standard global data source and methodology, based on assignee grade-level, home location and family size.
Home location; and
Type of temporary accommodations (e.g., whether there are kitchen facilities).
In addition to travel time (see section 3.5.1), one business week (usually five days) paid leave is granted to help the assignee settle into the home location. However, time off should be charged, as a default, to the home member firm. The assignee may take these days immediately or when moving into the home residence, if this is later, or a combination of both, but must be taken within the first three months of the international assignment end- date.
3.5.5 Time off upon arrival
The repatriation payment is the relocation payment (see section 3.4.11) ‘in reverse’. Therefore, it is:
As KPMG utilizes two alternative compensation philosophies for international assignments (home-based and host-based – see section 1.2.2), there are two corresponding tax policy approaches: the ‘home-basis tax approach’ and the ‘host-basis tax approach’.
As Host-Peer (Employees) assignees are provided host-based compensation, KPMG also adopts the host-basis tax approach.
3.5.6 Repatriation payment
3.6 Taxation and social security/ insurance
3.6.1 Tax policy
The objective of the host-basis tax approach is to ensure that an assignee does not bear the cost of any income tax or social taxes on international assignment-related allowances and benefits and has a comparable net pay (excluding international assignment allowances and benefits) as host country peers.
As part of the ‘host-basis tax approach’ (see section 3.6.1) the assignee’s responsibility regarding costs is limited to the social taxes payable on ‘host country standard compensation’, which excludes international assignment-related allowances and benefits (on which KPMG bears the tax costs).
Any voluntary employee contributions made by the assignee into either the home country or host country systems are entirely his or her responsibility.
KPMG’s Global Mobility Services department (GMS) provides tax compliance services to the firm’s assignees. The services include the following (as applicable):
3.6.2 Tax compliance services
3.6.3 Social security/insurance
Tax briefing sessions, in both the home country and host country, at the start of the international assignment and again before repatriation;
Preparation of host country and home country tax returns (including any necessary ancillary services such as extensions), although home country tax returns will only be prepared if the home country includes the assignee’s KPMG compensation (e.g., they will not be prepared on a non-resident basis when only personal income is included);
Preparation of tax settlement calculations (if necessary);
Handling of inquiries from taxing authorities that impact tax on the assignee's KPMG compensation related to the international assignment; and
Assistance with audits/examinations/notices issued by tax authorities relating to KPMG compensation.
Employee costs
Host-Peer (Partners) International Assignment
4
4.1 Overview
4.1.1 Compensation package
4.1.2 Duration
Partners undertaking a long-term international assignment are covered under this package or the Home-Based Equalized International Assignment Package (see section 5). In determining which of the two applies, typically home-country partnership/tax matters, individual tax matters, or other administrative issues are the drivers.
The compensation package offered is a host-based methodology (see section 1.2.2), which is supplemented by a range of international assignment-related allowances and benefits for relocation, during the international assignment and repatriation to the home country. The package is designed to provide the assignee with a similar standard of living in the host country enjoyed by his or her local peers.
As a default the assignee’s pay is delivered via the host country payroll (active payroll). It may also be necessary to operate a shadow payroll in the home country if there are remittance requirements (e.g., employee benefits, income tax and social security).
The minimum duration for this international assignment type is one year; with a maximum duration of five years (including extensions).
4.1.3 Grade-level
As a default, only partners are eligible for this international assignment type; and employees instead are offered the Host-Peer (Employee) International Assignment (see section 3). However, at the discretion of the business, employees at one grade-level below partner (e.g., managing director, director, or member firm equivalent) may be offered this international assignment type instead.
International assignments of less than one year are defined as short-term (see section 2). If the assignee were to remain in the host country for more than five years, he or she may be subject to localization provisions.
An integral element of the host-peer package is the ‘host-basis tax approach’ (see section 4.6.1), the objective of which is to ensure that an assignee does not bear the cost of any income tax or social taxes on international assignment-related allowances and benefits and has a comparable net pay (excluding international assignment allowances and benefits) as host-country peers.
Pay delivery
4.1.4 Family
4.2 Compensation and benefits
4.2.1 Base salary
These international assignments are offered on either a single (unaccompanied) or accompanied basis. For accompanied status, expense reimbursements and other support, will be provided for only dependent family members to accompany the assignee in the host country location for the international assignment. Also see section 1.2.3.
The assignee will receive a salary as offered by the host member firm based on its standard policies and practice for local employees (‘host-peer basis’), considering the individual’s experience and responsibilities. Increases in the host base compensation during the international assignment would be implemented as part of the standard performance and pay review in the host member firm.
During the first and last years of an international assignment, the assignee will work for the host and home member firms for part of the performance year. Based on the start/end date, and the incentive compensation policies in the home and host member firms, the assignee could be detrimentally affected in terms of eligibility. Ideally the assignee should receive a pro-rata portion of incentive compensation from each member firm, based on respective policies, for the period of the year worked for each firm. Where this is not possible (e.g., due to plan rules), the respective member firm(s) may, at its sole discretion decide to provide an alternative payment in lieu of the incentive compensation.
No provisions apply to dependents remaining in the home country unless specifically stated in the remainder of this section.
The assignee will, as a default, be eligible for the incentive compensation plans offered in the host location (host-peer basis), in lieu of home-country plans.
4.2.2 Incentive compensation
For the provision of employee benefits, there is a distinction between the following:
See Appendix B for a categorization of short-term and long-term employee benefits.
When necessary, alternative arrangements will be made (to the default position as stated in the table above), between the home and host member firms, with the aim to leave the assignee broadly no better or worse off. Examples of when the default position would have to be amended include, but are not limited to:
4.2.3 Employee benefits
If it is not possible to continue to provide a particular benefit to an assignee (e.g., country legal restrictions do not allow participation by a non-resident so he or she is ineligible);
An existing home country benefit is insufficient/invalid due to the assignee living in the host location; and
The split provision (‘short-term home’ and ‘long-term host’) results in either gaps or duplication in benefits.
Changes to benefit provision may include discontinuing certain provisions, providing substitute plans (e.g., international medical insurance), or providing additional benefits.
As a default, all working arrangements and time off follow host country policy, including, but not limited to annual leave/ personal time off/ vacation, public and company holidays, maternity/ paternity/ parental/ adoption leave, other paid or unpaid time off and working hours. This default position is subject to the laws and regulations of the host and home country, as appropriate.
Any outstanding leave balances accrued and remaining in the home country before the start of the international assignment are treated in accordance with home country policy (e.g., carrying over until repatriation, paying them out).
This allowance is a regular payment made to compensate the assignee in host locations where there is a substantially lower quality of living compared to the home country.
The location allowance is calculated as a percentage of base salary (from zero to a maximum of 30 percent). The base salary used for the calculation is subject to a maximum set by the host member firm (typically the level of a first-year partner).
The allowance is paid in regular installments throughout the international assignment along with regular compensation based on the number of pay periods in the year. The payments start as soon as the assignee physically relocates to the host country, even if he or she is living in temporary accommodation. The allowance stops when the assignee repatriates to the home country (or when the international assignment ends in another way).
See section 1.2.2 regarding the refund of any host-country KPMG-funded contributions.
4.2.4 Working hours and time off
4.3 On-going international assignment allowances and benefits
4.3.1 Location allowance
The location allowance will change when the assignee’s annual base compensation changes or when the host country percentage is adjusted by the third-party vendor.
KPMG uses a standard global data source and methodology to determine the location allowance for all countries in which the firm operates. The location allowance is calculated by using a ‘location score’, which Mercer produces considering a variety of factors (housing quality and availability; climate and other physical conditions; pollution levels; medical facilities; and access to cultural activities, retail outlets and services).
The firm will provide the assignee with the housing benefit (which is designed for rental accommodation) for rent and utility costs (and other ongoing elements such as appliances if not standard in host location). The benefit usually excludes other costs, such as domestic help, gardening services, pool and grounds maintenance.
Note: Host country housing may be provided in a variety of forms, e.g., a cash allowance, direct payment to a third party, or provision of firm-owned property, based on host member firm policy.
The standard housing benefit is provided to assignees who have on-going housing costs in the home country. The value of the housing provided is determined by calculating the standard housing costs in the host location, which is based on pre-determined parameters set by the host member firm, utilizing a standard global data source and methodology, which uses the following factors:
The benefit provided to the assignee for host country housing costs differs depending on whether he or she has ongoing housing costs in the home country:
4.3.2 Housing
1. For more information see the subsections immediately below,
Standard housing costs
Location;
Grade/level of the assignee; and
Accompanying family size.
If the assignee is provided a cash allowance and chooses accommodation where the costs are in excess of the standard housing costs (see above), he or she will be responsible for the difference. Conversely, the housing allowance will not be reduced if the assignee’s actual costs are less. Also, the housing allowance will be fixed for the duration of the international assignment.
If the assignee has no ongoing home country housing costs, the firm will provide the assignee with a housing subsidy (contribution) towards the cost of rental accommodation in the host country. As with the standard housing costs (see above) the subsidy/contribution is based on utilizing a standard global data source and methodology. The subsidy/contribution is designed to equate to the incremental costs of housing in the host location, rather than 100 percent of costs (in contrast to the standard housing benefit). This amount is designed to compensate the assignee from being in a detrimental position due to being an assignee.
Housing subsidy/contribution
Furnished accommodation is provided, if possible, to avoid the costs of securing furniture. The host member firm also determines the housing arrangements (e.g., whether a lease should be in the name of the host member firm or the assignee).
Other housing aspects
Provision of assistance for transportation in the host location will be based on host firm member policy applicable to local hires (‘host country basis’), as part of the short-term employee benefits package (see section 4.2.3), considering business needs for the assignee’s role in the host location. However, there may be no assistance for host country transportation if there is no such benefit provided by the host member firm per their compensation policies.
Domestic policy
Separate from the domestic policy (above), the assignee may be provided an additional benefit if he or she is in a materially detrimental position compared to host peers. For example, inability to lease a car or obtain insurance, or to do so at a ‘reasonable’ rate.
Expatriate policy
KPMG does not support assignees purchasing housing in the host location as there are often complicated tax and legal consequences, and a large capital investment in the host location is likely to reduce the assignee’s mobility in the future. Assignees may not purchase property in the host country with the firm-provided housing allowance or subsidy/contribution. Therefore, should the assignee purchase housing in the host country this housing benefit will be forfeited.
4.3.3 Host country transportation
Other aspects
The benefit (domestic or expatriate) may be in the form of a car (e.g., fleet car, lease, rental, etc.), to reimburse the assignee for costs, or via an allowance.
The provision of any host country transportation benefit may be amended/withdrawn if the assignee has taken a car to the host location.
Operating expenses (such as insurance, maintenance, and fuel) during KPMG business will be reimbursed via the host country expense system.
This benefit is subject to the following parameters:
The provision of a benefit for the cost of educating an assignee’s children in private schools is only appropriate where KPMG considers the government-subsidized host country education facilities to be inadequate (e.g., language requirements or curriculum differences for the child to re-enter the home-country education system).
In some circumstances (e.g., appropriate level of schooling is not available in the host country), it may be preferable for an assignee’s children to remain in the home location (e.g., attend boarding school). In such circumstances the benefit would not include any accommodation-related costs.
4.3.4 Children’s education assistance
The costs for ‘market-standard schools’, using a standard global data source and methodology;
Costs are restricted to tuition and registration and therefore exclude other costs (such as uniforms, books, supplies, extra-curricular activities and school trips);
The host member firm may limit the overall cost of the benefit; and
Any language training costs are based on host country policy.
Type of schools limited to mandatory or compulsory ‘primary/elementary’ and ‘secondary’’ (as defined by the home country system), therefore it excludes both pre-school and tertiary education (e.g., university);
Transportation expenses to and from school will only be considered if such transportation would have been provided free of charge in the home country, and such costs are not accounted for by any transportation benefit (see section 4.3.3);
Any benefit is restricted to incremental costs for the assignee compared to those in the home country (e.g., if children are in private school at home prior to international assignment);
4.3.5 Home leave
Home leave trips are provided to help assignees maintain internal and external connections in the home country and facilitate reintegration. The standard home leave benefit is:
Other aspects are:
One trip every twelve months for the assignee and the accompanying dependents;
Economy class travel (air/train) by the most direct route (no stopovers);
Ground transportation to and from airports/stations;
Reasonable baggage charges will be reimbursed per home member firm policy;
No cash alternative for any home leave trips not taken;
The home leave benefit does not allow assignees to visit other locations in lieu of the home location;
Booking needs to be arranged via the KPMG-appointed travel agent (where applicable).
To be eligible for a home leave trip, the assignee may be required, at the discretion of the home member firm, to physically visit the home country office and/or meet his or her performance manager in person; and also maintain any required career/performance data or systems (per home member firm policy).
The assignee must obtain pre-approval from both the host member firm and home member firm regarding the scheduling of home leave (and the cost from the member firm bearing the cost). In general, home leave should not be arranged in the first three and last three months of the international assignment in the absence of compelling circumstances (although such restrictions should not prevent the assignee from taking the correct number of home leaves).
Time off charged to the assignee’s vacation/ annual leave eligibility; and
Reasonable travel time charged to ‘working hours’ (up to one day in each direction).
One trip for each twelve months on international assignment;
When the host location has a location allowance (see section 4.3.1) calculation of 20 percent or more, this benefit becomes available. The intent of the R&R trip is to provide a break from living in a difficult environment and includes the following:
4.3.6 Rest and relaxation leave
For the assignee and all accompanying dependent family members;
One trip every twelve months;
Economy class round-trip travel (air/train) by the most direct route (no stopovers);
Ground transportation to and from airports/stations;
Excess baggage charges will not be reimbursed; and
No cash alternative for any visits not taken.
Five business (paid) and seven calendar days per trip, plus reasonable travel time (up to one day) each way allowed;
Nearest suitable destination (as determined by the host member firm);
Economy class travel (air/train) plus ground transportation to and from airport/station;
No financial alternative offered where the trip is not taken, and trips may not be carried over from year to year.
All other travel and subsistence costs and arrangements per host country business travel policy (e.g., hotel, car rental) but excluding living expenses (to be paid by the assignee); and
Dependent children under age 25 who are full-time students and remain in the home country during the international assignment are provided a benefit to visit the assignee in the host location. The benefit includes:
4.3.7 Children’s visits to the host country
All home country professional licensing fees, memberships, etc., will continue to be subject to the home member firm policies throughout the international assignment. Conversely, any qualifications, licenses, etc., required by the laws and/or regulations of the host country will follow the policies of the host member firm.
4.3.8 Professional memberships/ licensing
All home country and host country training requirements will be governed by the policies of the respective member firms throughout the international assignment.
4.3.9 Training
An emergency leave benefit is provided for either compassionate reasons or other reasons per the table below:
4.3.10 Emergency leave
Should the host member firm wish to claim repayment in the event of an early repatriation, the details must be determined before the start of the international assignment and stipulated in writing. Any claim of repayment from the home member firm must be included in the CSA and any claim on the assignee (whether from the host member firm or home member firm) must be included in the assignee’s T&C letter.
The benefit, for both categories above, includes:
Economy class travel (air/train) by the most direct route (no stopovers);
Ground transportation to and from airports/stations;
Excess baggage charges will not be reimbursed;
Travel benefits provided to accompanying dependent family members as well as assignee; and
Assignee also granted time off per host country policy (including scheduling).
Assignees eligibility for club membership benefits is based on the host member firm policy applicable to peers at the same level in the host country including the applicable institutions and parameters regarding costs. The provision of such memberships is designed to expose the assignee opportunities to further KPMG business.
This benefit is subject to business leader approval as it is only provided under the following specific circumstances:
4.3.11 Club memberships
4.4 Pre-assignment and relocation
4.4.1 Pre-assignment trip
1. Must necessitate the individual(s) to be physically present in the host location, i.e., virtual presence is unacceptable.
2. Examples would include in-person client/internal meetings, required for assignee’s role to be approved. This may be as part of the international assignment approval process or to facilitate integration.
3. Examples include house hunting and/or school selection/ interview/testing in host country location. This would only be approved when the international assignment has a very high probability of going ahead.
When applicable, the trip is provided with the following parameters:
If this trip includes accompanying dependents, it is recommended that it is combined with any destination services provision (see section 4.4.11).
Five business (paid) and seven calendar days per trip, plus reasonable travel time (up to one day) each way allowed; and
Class of travel (air/train), ground transportation to and from airport/station, and all other travel and subsistence costs and arrangements per home country business travel policy (e.g., hotel, car rental and living expenses).
KPMG will bear the cost of expenses related to immigration compliance for the assignee and any accompanying dependents, for example: visas, work permits (assignees only), notarization or certification of documents, background checks and travel expenses to consular offices.
In some countries there is a requirement for a medical examination/certification and/or inoculations (e.g., as part of the immigration process). Assignees, and accompanying dependents, may also choose to undergo such procedures voluntarily, as part of the move to the host country based on specific individual and/or international assignment circumstances.
KPMG will reimburse reasonable costs not covered by insurance.
The expenses of storing personal belongings, including packing, transportation, and insurance while in storage during the assignment, will be reimbursed when the assignee’s home residence has not been left vacant (including disposed of or rented).
However, the cost of a passport or other regular travel documents are the responsibility of the assignee.
Assignees must comply with all applicable immigration laws and regulations and must not depart from their home country until clearance has been provided by the host member firm.
4.4.2 Immigration
4.4.4 Home country residence
4.4.3 Medical exams and inoculations
Storage of home country personal belongings
The storage benefit is subject to limitations, restrictions and exclusions, including, but not limited to:
Maximum weight or size;
The difference in the actual sale proceeds and the fair market value (as determined by an official professional data source acceptable to the home member firm) for a sale;
The actual cost and penalties incurred as a result of breaking a financing agreement;
Subject to a maximum of 15 percent of the fair market value of the car; and
Limited to one vehicle for a single assignee or two vehicles for an accompanied assignee.
A cap on total cost;
Cumulative/individual value of goods (for insurance); and
Exclusion of certain goods (e.g., large items such as cars, boats and trailers).
No reimbursement is provided for any other costs related to the home country residence, such as property management or home sale.
Other costs (not provided)
This benefit is designed to compensate the assignee for financial loss due to a disposal of a car in the home location, by either sale or breaking a financing agreement (such as a lease prior to maturity). The calculation of the benefit is:
4.4.5 Car disposal at home country
An assignment orientation provides an opportunity to manage assignee (and accompanying dependents, if applicable) expectations, disseminate important information, and help address any concerns. There are two different types of assignment orientation: an outbound (in the home country) and an inbound (in the host country), both conducted by respective GMPs.
They can be conducted in person (preferably) or virtually, with the outbound one ideally conducted prior to departure, the inbound as soon as possible at the start of the international assignment. The orientations should include discussion on a variety of topics, examples of which are outlined below:
4.4.6 Assignment orientations
Other specialists — such as benefits or payroll experts, for example — should attend the orientations when possible. There is generally a separate tax briefing conducted by a KPMG tax professional (see section 4.6.2).
The assignee should have a security briefing when this is considered necessary (e.g., the host country is considered a high-risk location), prior to departure. The briefing will be conducted by internal security resources or the firm-designated security organization (International SOS at the time of writing).
The firm-designated security organization provides emergency medical and security assistance to all KPMG professionals traveling internationally (including assignees). Online resources are available, and all assignees are urged to take advantage of the material published and obtain KPMG’s membership details. Note that these services are for emergencies only, as duly authorized by KPMG, and are not, therefore, a substitute for individual medical and accident insurance.
The host country will decide upon the most practical and cost-effective way to travel to the host location. The standard mode of transportation for assignees (and accompanying dependents, where applicable) is air travel but the host member firm may approve alternatives (e.g., train or assignee’s own car) where practical and cost-effective.
Reasonable travel time can be charged to ‘working hours’ (up to one day). Travel time should be charged, as a default, to the home member firm.
Other travel arrangements should be made per the host member firm business travel policy, including ground transportation to and from airports/station, or mileage allowances, and subsistence expenses.
Economy class tickets should be booked for air and train travel. When travelling by air it should be via the most direct route (no stopovers) and round-trip tickets where appropriate.
4.4.7 Security briefing
4.4.8 Travel to the host location
Other costs (not provided)
Type of temporary accommodations (e.g., whether there are kitchen facilities).
Travel insurance
Assignees should be provided travel insurance, which would typically be arranged automatically when travel arrangements are made via the relevant member firm designated travel system (e.g., when booking flights). If travel insurance is not automatically provided, it is the home member firm’s responsibility to arrange it. However, if any assignee does not book travel with the firm-designated travel system/ provider they are responsible for both arranging for, and bearing the costs of the travel insurance.
Border control travel costs
Related mandatory border-control costs (required by the host country laws and regulations) will, as a default, be borne by KPMG. These costs may be imposed on a temporary basis by the host country (in response to an emergency situation) or be a long-term standard arrangement. However, the assignee should not incur such expenses and expect them to be reimbursed without prior pre-approval, which will be based on host member firm policy.
Excess baggage expenses for the assignee will be paid by the firm for up to four pieces of luggage, less any baggage allowance provided with the assignee’s airline ticket. So, if the airline free allowance for the assignee is one checked bag, excess baggage expenses can be claimed for three pieces of luggage. This applies whether the assignee is single or accompanied. Excess baggage costs are also subject to a maximum set by the host member firm.
The most appropriate and cost-effective way for the assignee to transport personal belongings (i.e., excess baggage, air shipment or surface shipment) will be based on the facts and circumstances of the international assignment, including:
The standard parameters for each type are set out in the sub-sections below.
See also section 4.4.4 for storage of personal belongings.
4.4.9 Transportation of personal belongings
Excess baggage
The housing arrangements (furnished or unfurnished, etc.);
The number of accompanying dependents (if any) relocating to the host country with the assignee;
The duration of the international assignment; and
The availability of goods in the host location.
Assignees must not travel to the host country until immigration clearance has been provided by the host member firm (see section 4.4.2).
Air shipment/surface shipment
Furniture allowance in lieu of shipping
This benefit requires prior approval and is provided based on the facts and circumstances of the international assignment (including whether furniture has to be shipped and number of accompanying dependents). If provided, the maximum standard parameters are outlined below:
The shipping benefit includes habitual ancillary services, such as packing, intermediary storage (upon departure and arrival), customs clearance process, delivery, unpacking and insurance. However, it excludes dismantling and/or re-assembling furnishings.
The shipping benefits are also subject to limitations, restrictions and exclusions, including, but not limited to:
This benefit is only applicable if the host member firm determines that both:
Maximum weight;
Appropriately furnished accommodation is unavailable or uneconomic; and
The rental or purchase of furniture (and/or major appliances) is more cost efficient than shipment of the assignee’s equivalent goods from the home location, or such items cannot be shipped (e.g., assignee does not have them, or they are still required).
Prohibited items (see Appendix C);
A cap on total cost; and
Cumulative/individual value of goods (for insurance).
For either rental or purchase, host member firm pre-approval is required and is subject to limitations. Provision of this benefit does not preclude a shipping benefit to be provided for other goods (excluding furniture/ major appliances). Rental costs will require ongoing payment (e.g., an allowance) and purchase via a one-off payment (which should be completed within the first three months of the international assignment). Any purchased furniture will be the property of the firm to be disposed of per host country policy at the end of the international assignment.
See Appendix C for a list of items typically included and excluded.
Temporary accommodation will be provided for the assignee and accompanying dependents (if applicable).
The type of accommodation provided is based on host member firm policy (such as a hotel or serviced apartment).
A GO Daily Allowance is paid to the assignee for each calendar day throughout the temporary living period to compensate for the additional costs of living in temporary accommodation. The rate of the allowance is set by the host member firm, using a standard global data source and methodology, utilizing the following criteria:
No costs are reimbursed for pet shipment.
Pet shipment (not provided)
Accommodation/lodging
Meals and incidentals
The temporary living period is for up to one month, which encompasses time spent both:
4.4.10 Temporary living
After moving out of the home residence but before departure from the home country; and
Family size (separate rates are applied to children up to twelve years old);
Host location; and
Type of temporary accommodations (e.g., whether there are kitchen facilities).
After arrival in the host country but before permanent accommodations are available (e.g., rental lease has not started or because the assignee’s furniture shipment has yet to arrive).
Assistance with transportation during the temporary living period is based on host member firm policy (e.g., car rental or provision of a pass for public transportation), if applicable.
In addition to information provided during the onboarding process in the host member firm, the assignee may also be provided services by a firm-designated service provider.
These services are available only once during an international assignment.
These services are provided to assist in settling into the host location, where the assignee does not have same access to market as locals, and required to make their own housing arrangements, etc.
Examples of the provided services includes finding and securing accommodation (including type of lease), connection of utilities, setting up bank accounts, introduction to social organizations, orientation to the public transportation system, shopping places, healthcare providers, etc.
The provision of these services is based on host member firm policy, which will set parameters such as:
Provision of this benefit will be assessed together with any on-going host country transportation assistance (see section 4.3.3) to ensure there is no duplication.
4.4.11 Destination services
This benefit is available only once during the international assignment.
Assistance in securing host country housing is included as part of the destination services benefit (see section 4.4.11).
4.4.12 Securing host country accommodation
Transportation
Services
Any benefit provided to the assignee associated with fees for securing host country housing (including obtaining a lease), and set-up (such as connection of utilities), is based on the policy in place at the time of the host member firm. This includes predetermined criteria (such as cost limitations) and usually only provided when such fees are habitually required to secure housing.
Fees
Designated time spent with representatives (up to a maximum of one business week, but could be less);
Applicable fees (including caps); and
Services to be provided.
The assignee is also entitled to a loan to cover any deposits (e.g., first/ last month’s rent) that are necessary to secure the rented property, based on host member firm policy (subject to limitations). The loan must be repaid, and the deposit refunded in full by the end of the international assignment (see section 4.5.4).
In addition to travel time (see section 4.4.8), one business week (usually five days) paid leave is granted to help the assignee settle into the host location. However, time off should be charged, as a default, to the host member firm. The assignee may take these days immediately or when moving into permanent accommodations, if this is later, or a combination of both, but must be taken within the first three months of the international assignment start-date.
4.4.13 Time off upon arrival
As each international assignment is unique the costs incurred by a given assignee will vary based on the particular facts and circumstances. This relocation payment is intended to be applied to any costs incurred in moving to and settling into the host location that are not specifically addressed by other elements of this policy.
The relocation payment is a fixed one-time allowance paid in host currency. The host member firm uses a standard global data source and methodology to determine the relocation payment, which considers the following factors when producing the data:
4.4.14 Relocation payment
This one-time allowance is provided to any assignee who is accompanied by his or her spouse/domestic partner to settle into the host location (e.g., towards the costs of pursuing professional careers, resuming education or engaging in volunteer activities).
The standard allowance is USD 3,000 (or host country equivalent). The assignee is not required to provide receipts to qualify for the allowance.
This allowance will not be paid when the spouse/domestic partner has secured a role in the host member firm (as a local hire, an assignee or as a personal temporary international move); also, the allowance will not be paid if he or she is an assignee with another organization.
4.4.15 Accompanying spouse/ domestic partner allowance
Deposits
Assignee grade-level;
Host location; and
Family size.
Payment of this allowance should not be withheld if the spouse/ domestic partner has to delay relocation to the host country and/or repatriate early (e.g., due to career, children’s schooling needs). However, to qualify for the allowance, the spouse or domestic partner must be in the host country with the assignee for the vast majority of the international assignment.
On a case-by-case basis, the host or home member firm may approve assignee language training with a designated external service provider. Where language training is approved the associated costs are paid by the firm within the agreed parameters.
The host member firm may test language ability as part of the international assignment approval process. The assessment will determine if the assignee is at the minimum host country required proficiency level to operate in the business, and language training may be stipulated as a requirement for the international assignment to proceed.
4.4.16 Language training
KPMG retains the services of a specialist cross-cultural awareness organization (Culture Wizard at the time of writing) to provide online resources that are available to the assignee, including host country information. Assignees are strongly encouraged to access the materials online, which have been pre-paid by KPMG.
4.4.17 Cross cultural training
See section 1.3.2 regarding relevant policy application for repatriation provisions.
The calculation of the benefit is:
4.5 Repatriation
This benefit is designed to compensate the assignee for financial loss due to a disposal of a car in the host location, by either sale or breaking a financing agreement (such as a lease prior to maturity).
However, no assistance will be provided in a host country where the member firm domestic transportation policy (see section 4.3.3) excludes a car benefit, even if assignee purchased a car.
4.5.1 Car disposal at host country
The difference in the actual sale proceeds and the fair market value (as determined by an official professional data source acceptable to the home member firm) for a sale;
The actual cost and penalties incurred as a result of breaking a financing agreement;
Subject to a maximum of 15 percent of the fair market value of the car; and
Limited to one vehicle for a single assignee or two vehicles for an accompanied assignee.
4.5.2 Travel to the home location
4.5.3 Host country residence
The mode of travel to the host country at the beginning of the international assignment (see section 4.4.8) is applicable when the assignee returns home, and accompanying dependents where applicable (including utilizing the return tickets of a round-trip booking, where appropriate).
If new travel arrangements are required, economy class tickets should be booked for air and train travel. When travelling by air it should be via the most direct route (no stopovers).
Reasonable travel time can be charged to ‘working hours’ (up to one day). Travel time should be charged, as a default, to the host member firm.
Other travel arrangements should be made per the home member firm business travel policy, including ground transportation to and from airports/station, or mileage allowances, and subsistence expenses.
Assignees should be provided travel insurance, which would typically be arranged automatically when travel arrangements are made via the relevant member firm designated travel system (e.g., when booking flights). If travel insurance is not automatically provided, it is the host member firm’s responsibility to arrange it. However, if any assignee does not book travel with the firm-designated travel system/ provider they are responsible for both arranging for, and bearing the costs of the travel insurance.
Travel insurance
Related mandatory border-control costs (required by the home country laws and regulations) will, as a default, be borne by KPMG. These costs may be imposed on a temporary basis by the home country (in response to an emergency situation) or be a long-term standard arrangement. However, the assignee should not incur such expenses and expect them to be reimbursed without prior pre-approval, which will be based on home member firm policy.
Border control travel costs
The host member firm will assist with negotiating a lease break should the international assignment terminate early. Any fees or penalties charged for early lease break will be paid by the firm if it occurred due to business reasons. In addition, standard end-of-lease costs at the conclusion of the international assignment will be paid by the firm. The payment of the lease break and end-of-lease costs by KPMG is conditional on the assignee having fulfilled his or her responsibilities.
End of lease
Deposits
The host member firm will also provide assistance (where required) to reclaim deposits from the assignee’s landlord. However, KPMG will not reimburse the assignee for deductions due to cleaning fees or damages. Assignees must repay any outstanding loans and advances, if applicable (see section 4.4.12), to the firm before leaving the host country.
Pet shipment (not provided)
Accommodation/lodging
No costs are reimbursed for pet shipment.
The assignee’s personal belongings will typically be transported back to the home country in the same way they were sent to the host location at the start of the international assignment (see section 4.4.9). Also, the same parameters apply (albeit based on home member firm policy) for:
4.5.4 Transportation of personal belongings
The temporary living period is for up to one month, which encompasses time spent both:
Temporary accommodation will be provided for the assignee and accompanying dependents (if applicable).
The type of accommodation provided is based on home member firm policy (such as a hotel or serviced apartment).
4.5.5 Temporary living
Excess baggage;
After moving out of permanent accommodation but before departure from the host country; and
After arrival in the home country but before the home residence is available (e.g., tenants have not vacated the property or because the assignee’s furniture shipment has yet to arrive).
Surface shipment.
Air shipment; and
Meals and incidentals
Storage of home country personal belongings
Securing home country accommodation
A GO Daily Allowance is paid to the assignee for each calendar day throughout the temporary living period to compensate for the additional costs of living in temporary accommodation. The rate of the allowance is set by the home member firm, using a standard global data source and methodology, utilizing the following criteria:
Transportation
Assistance with transportation during the temporary living period is based on home member firm policy (e.g., car rental or provision of a pass for public transportation), if applicable.
If a storage benefit was provided as part of the relocation to the host country (see section 4.4.4), the cost of retrieving of items stored in the home country during the international assignment (including delivery and unpacking) will be reimbursed.
In addition to travel time (see section 4.5.2), one business week (usually 5 days) paid leave is granted to help the assignee settle into the home location. However, time off should be charged, as a default, to the home member firm. The assignee may take these days immediately or when moving into the home residence, if this is later, or a combination of both, but must be taken within the first three months of the international assignment end-date.
If the home county residence was not retained during the international assignment, the assignee may be provided house-hunting services by a firm-designated service provider, based on the home member firm domestic relocation policy. Such a policy will set parameters such as:
Stored items must be retrieved within two months of assignee’s repatriation to the home country.
Family size (separate rates are applied to children up to twelve years old);
Home location; and
Type of temporary accommodations (e.g., whether there are kitchen facilities).
Designated time spent with representatives;
Applicable fees (including caps); and
Services to be provided.
4.5.6 Home country residence
4.5.7 Time off upon arrival
Intended to be applied to any costs incurred in moving back to and resettling into the home location that are not specifically addressed by other elements of this policy;
Tax briefing sessions, in both the home country and host country, at the start of the international assignment and again before repatriation;
Preparation of host country and home country tax returns (including any necessary ancillary services such as extensions), although home country tax returns will only be prepared if the home country includes the assignee’s KPMG compensation (e.g., they will not be prepared on a non-resident basis when only personal income is included);
Preparation of tax settlement calculations (if necessary);
Determined by the home member firm, also using a standard global data source and methodology, based on assignee grade-level, home location and family size.
A fixed one-time allowance paid in home currency; and
4.5.8 Repatriation payment
The repatriation payment is the relocation payment (see section 4.4.14) ‘in reverse’. Therefore, it is:
As KPMG utilizes two alternative compensation philosophies for international assignments (home-based and host-based – see section 1.2.2), there are two corresponding tax policy approaches: the ‘home-basis tax approach’ and the ‘host-basis tax approach’.
KPMG’s Global Mobility Services department (GMS) provides tax compliance services to the firm’s assignees. The services include the following (as applicable):
As Host-Peer (Partners) assignees are provided host-based compensation, KPMG also adopts the host-basis tax approach.
The objective of the host-basis tax approach is to ensure that an assignee does not bear the cost of any income tax or social taxes on international assignment-related allowances and benefits and has a comparable net pay (excluding international assignment allowances and benefits) as host country peers.
4.6 Tax and social security/ insurance
4.6.1 Tax policy
4.6.2 Tax compliance services
Handling of inquiries from taxing authorities that impact tax on the assignee's KPMG compensation related to the international assignment; and
Assistance with audits/examinations/notices issued by tax authorities relating to KPMG compensation.
4.6.3 Social security/ insurance
As part of the ‘host-basis tax approach’ (see section 4.6.1) the assignee’s responsibility regarding costs is limited to the social taxes payable on ‘host country standard compensation’, which excludes international assignment-related allowances and benefits (on which KPMG bears the tax costs).
Any voluntary employee contributions made by the assignee into either the home country or host country systems are entirely his or her responsibility.
Employee costs
Home-Equalized International Assignment
5
5.1 Overview
5.1.1 Compensation package
5.1.2 Duration
5.1.3 Grade-level
Partners undertaking a long-term international assignment are covered under this package or the Host-Peer (Partners) International Assignment (see section 4). In determining which of the two applies, typically home country partnership/tax matters, individual tax matters, or other administrative issues are the drivers.
The compensation package aims to maintain home country compensation (‘home-based methodology’ – see section 1.2.2), which is supplemented by a range of international assignment-related allowances and benefits for relocation, during the international assignment and repatriation to the home country. The package is intended to give the assignee a standard of living in the host country that is commensurate to that enjoyed in the home country prior to the international assignment (broadly not advantaged nor disadvantaged financially).
An integral element of the home-based compensation package is the ‘home-basis tax approach’ (see section 5.6.1), the objective of which is to ensure that an assignee does not bear the cost of significantly more or less income tax or social taxes on KPMG compensation as a result of the international assignment.
The home country compensation basis is achieved, as a default, by continuing to pay the partner’s home-based compensation via the home country payroll (in home-country currency). Paying the assignee via the host country payroll will only be used if the home payroll option is not possible.
The minimum duration for this international assignment type is one year; with a maximum duration of five years (including extensions).
As a default, only partners are eligible for this international assignment type; and employees instead are offered the Host-Peer (Employee) International Assignment (see section 3). However, at the discretion of the business, employees at one grade-level below partner (e.g., managing director, director, or member firm equivalent) may be offered this international assignment type instead.
International assignments of less than one year are defined as short-term (see section 2). If the assignee were to remain in the host country for more than five years, he or she may be subject to localization provisions.
Pay delivery
Standard housing costs
5.1.4 Family
These international assignments are offered on either a single (unaccompanied) or accompanied basis. For accompanied status, expense reimbursements and other support, will be provided for only dependent family members to accompany the assignee in the host country location for the international assignment. Also see section 1.2.3.
This is provided using a home-country basis to determine how much is provided to the assignee. However, as described in section 5.1.1, there are two different ways that the assignee can be paid (via home country or host country payroll, with corresponding methodologies.
As a default, the assignee remains on the home country payroll, and will continue to receive his or her base salary that was in effect before the international assignment in the home location, subject to scheduled reviews.
However, where the assignee cannot remain on the home country payroll, the assignee will instead be paid via host country payroll. In such circumstances the assignee will be kept substantially ‘whole’ by the payment of a host-peer salary plus an adjustment (see ‘compensation methodology’ in section 5.1.1).
The assignee’s performance during the international assignment in the host location would be utilized for any incentive compensation plans that assess individual performance.
For the provision of employee benefits, there is a distinction between the following:
As a default, plan participation remains in the home member firm system (‘home-country basis’). However, plan participation may, based on the facts and circumstances of the particular international assignment, switch to the host country. Should this be the case, plan participation may need to be adjusted to make sure that total partner pay (see section 5.2.1) is not materially affected by the international assignment. Also, care should be taken to factor in any impacts on eligibility during the first and last years of the international assignment, where the assignee will work for the host and home member firms for only part of the performance year.
No provisions apply to dependents remaining in the home country unless specifically stated in the remainder of this section.
5.2 Compensation and benefits
5.2.2 Incentive compensation
5.2.3 Employee benefits
5.2.1 Base salary
See Appendix B for a categorization of short-term and long-term employee benefits.
When necessary, alternative arrangements will be made (to the default position as stated in the table above), between the home and host member firms, with the aim to leave the assignee broadly no better or worse off. Examples of when the default position would have to be amended include, but are not limited to:
As a default, all working arrangements and time off follow host country policy, including, but not limited to annual leave/ personal time off/ vacation, public and company holidays, maternity/ paternity/ parental/ adoption leave, other paid or unpaid time off and working hours. This default position is subject to the laws and regulations of the host and home country, as appropriate.
Any outstanding leave balances accrued and remaining in the home country before the start of the international assignment are treated in accordance with home country policy (e.g., carrying over until repatriation, paying them out).
This is a positive adjustment to the assignee’s compensation to account for the increased cost of living difference (if any) experienced by assignees in the host location.
Changes to the benefits package may include discontinuing certain provisions, providing substitute plans (e.g., international medical insurance), or providing additional benefits.
See section 1.2.2 regarding the refund of any host-country KPMG-funded contributions.
If it is not possible to continue to provide a particular home-country benefit to an assignee (e.g., legal restrictions do not allow participation by a non-resident so he or she is ineligible);
An existing home country benefit is insufficient/invalid due to the assignee living in the host location; and
The split provision (‘short-term home’ and ‘long-term host’) results in either gaps or duplication in benefits.
5.2.4 Working hours and time off
5.3 On-going international assignment allowances and benefits
5.3.1 Cost of living allowance (COLA)
COLA is therefore provided as necessary for the assignee to maintain his or her home country purchasing power in the host country (the difference between the amount of money required for everyday living expenses in the home country and related expenses in the host country). Therefore, if the cost-of-living in the host location is deemed the same or lower than the home country, the COLA will be zero.
COLA is calculated at the start of the international assignment and recalculated periodically (e.g., pay increases, change in assignee circumstances such as family size). It is provided in each pay period along with regular compensation.
This allowance is a regular payment made to compensate the assignee in host locations where there is a substantially lower quality of living compared to the home country.
The location allowance is calculated as a percentage of base salary (from zero to a maximum of 30 percent). The base salary used for the calculation is subject to a maximum set by the home member firm (typically the level of a first-year partner).
The location allowance will change when the assignee’s annual base compensation changes or when the host country percentage is adjusted by the third-party vendor.
The allowance is paid in regular installments throughout the international assignment along with regular compensation based on the number of pay periods in the year. The payments start as soon as the assignee physically relocates to the host country, even if he or she is living in temporary accommodation. The allowance stops when the assignee repatriates to the home country (or when the international assignment ends in another way).
KPMG uses a standard global data source and methodology to determine the location allowance for all countries in which the firm operates. The location allowance is calculated by using a ‘location score’, which Mercer produces considering a variety of factors (housing quality and availability; climate and other physical conditions; pollution levels; medical facilities; and access to cultural activities, retail outlets and services).
The COLA is calculated using a standard global data source and methodology using the following factors:
For more information on the calculation of COLA see Appendix C.
Base compensation level (subject to limitations);
Number of family members in the host country;
Currency exchange rates.
Host country location; and
Home country location;
Accompanying family size.
Grade/level of the assignee; and
Location;
Costs are restricted to tuition and registration and therefore exclude other costs (such as uniforms, books, supplies, extra-curricular activities and school trips);
Type of schools limited to mandatory or compulsory ‘primary/elementary’ and ‘secondary’’ (as defined by the home country system), therefore it excludes both pre-school and tertiary education (e.g., university);
The costs for ‘market-standard schools’, using a standard global data source and methodology;
Ground transportation to and from airports/stations;
One trip every twelve months for the assignee and the accompanying dependents;
Economy class travel (air/train) by the most direct route (no stopovers);
The home leave benefit does not allow assignees to visit other locations in lieu of the home location;
Reasonable baggage charges will be reimbursed per home member firm policy;
No cash alternative for any home leave trips not taken;
Booking needs to be arranged via the KPMG-appointed travel agent (where applicable).
The assignee must obtain pre-approval from both the host member firm and home member firm regarding the scheduling of home leave (and the cost from the member firm bearing the cost). In general, home leave should not be arranged in the first three and last three months of the international assignment in the absence of compelling circumstances (although such restrictions should not prevent the assignee from taking the correct number of home leaves).
To be eligible for a home leave trip, the assignee may be required, at the discretion of the home member firm, to physically visit the home country office and/or meet his or her performance manager in person; and also maintain any required career/performance data or systems (per home member firm policy).
Time off charged to the assignee’s vacation/ annual leave eligibility; and
Reasonable travel time charged to ‘working hours’ (up to one day in each direction).
Five business (paid) and seven calendar days per trip, plus reasonable travel time (up to one day) each way allowed;
One trip for each twelve months on international assignment;
For the assignee and all accompanying dependent family members;
All other travel and subsistence costs and arrangements per host country business travel policy (e.g., hotel, car rental) but excluding living expenses
(to be paid by the assignee); and
Nearest suitable destination (as determined by the host member firm);
Economy class travel (air/train) plus ground transportation to and from airport/station;
Ground transportation to and from airports/stations;
One trip every twelve months;
Economy class round-trip travel (air/train) by the most direct route (no stopovers);
Excess baggage charges will not be reimbursed; and
No cash alternative for any visits not taken.
Economy class travel (air/train) by the most direct route (no stop-overs);
Ground transportation to and from airports/stations;
Excess baggage charges will not be reimbursed;
Travel benefits provided to accompanying dependent family members as well as assignee; and
Assignee also granted time off per host country policy (including scheduling).
Five business (paid) and seven calendar days per trip, plus reasonable travel time (up to one day) each way allowed; and
Class of travel (air/train), ground transportation to and from airport/station, and all other travel and subsistence costs and arrangements per home country business travel policy (e.g., hotel, car rental and living expenses).
Maximum weight or size;
A cap on total cost;
Cumulative/individual value of goods (for insurance); and
Exclusion of certain goods (e.g., large items such as cars, boats and trailers).
The difference in the actual sale proceeds and the fair market value (as determined by an official professional data source acceptable to the home member firm) for a sale;
The actual cost and penalties incurred as a result of breaking a financing agreement;
Subject to a maximum of 15 percent of the fair market value of the car; and
Limited to one vehicle for a single assignee or two vehicles for an accompanied assignee.
The housing arrangements (furnished or unfurnished, etc.);
The number of accompanying dependents (if any) relocating to the host country with the assignee;
The duration of the international assignment; and
The availability of goods in the host location.
Maximum weight;
Prohibited items (see Appendix C);
Appropriately furnished accommodation is unavailable or uneconomic; and
The rental or purchase of furniture (and/or major appliances) is more cost efficient than shipment of the assignee’s equivalent goods from the home location, or such items cannot be shipped (e.g., assignee does not have them, or they are still required).
After moving out of the home residence but before departure from the home country.
After arrival in the host country but before permanent accommodations are available (e.g., rental lease has not started or because the assignee’s furniture shipment has
yet to arrive).
Family size (separate rates are applied to children up to twelve years old);
Host location; and
A cap on total cost.
Cumulative/individual value of goods (for insurance).
No financial alternative offered where the trip is not taken, and trips may not be carried over from year to year.
The host member firm may limit the overall cost of the benefit.
Any language training costs are based on host country policy.
Any benefit is restricted to incremental costs for the assignee compared to those in the home country (e.g., if children are in private school at home prior
to the international assignment);
Transportation expenses to and from school will only be considered if such transportation would have been provided free of charge in the home country, and such costs are not accounted for by any transportation benefit (see section 5.3.4);
5.3.2 Location allowance
The benefit provided to the assignee for host country housing costs differs depending on whether he or she has ongoing housing costs in the home country:
1. For more information see the subsections immediately below.
The standard housing benefit is provided to assignees who have on-going housing costs in the home country. The value of the housing provided is determined by calculating the standard housing costs in the host location, which is based on pre-determined parameters set by the host member firm, utilizing a standard global data source and methodology, which uses the following factors:
Housing subsidy/contribution
If the assignee has no ongoing home country housing costs, the firm will provide the assignee with a housing subsidy (contribution) towards the cost of rental accommodation in the host country. As with the standard housing costs (see above) the subsidy/contribution is based on utilizing a standard global data source and methodology. The subsidy/contribution is designed to equate to the incremental costs of housing in the host location, rather than 100 percent of costs (in contrast to the standard housing benefit). This amount is designed to compensate the assignee from being in a detrimental position due to being an assignee.
Other housing aspects
Home country equivalent benefit
Furnished accommodation is provided, if possible, to avoid the costs of securing furniture. The host member firm also determines the housing arrangements (e.g., whether a lease should be in the name of the host member firm or the assignee).
KPMG does not support assignees purchasing housing in the host location as there are often complicated tax and legal consequences, and a large capital investment in the host location is likely to reduce the assignee’s mobility in the future. Assignees may not purchase property in the host country with the firm-provided housing allowance or subsidy/contribution. Therefore, should the assignee purchase housing in the host country this housing benefit will be forfeited.
The firm will provide the assignee with the housing benefit (which is designed for rental accommodation) for rent and utility costs (and other ongoing elements such as appliances if not standard in host location). The benefit usually excludes other costs, such as domestic help, gardening services, pool and grounds maintenance.
Note: Host country housing may be provided in a variety of forms, e.g., a cash allowance, direct payment to a third party, or provision of firm-owned property, based on host member firm policy.
If the assignee is provided a cash allowance and chooses accommodation where the costs are in excess of the standard housing costs (see above), he or she will be responsible for the difference. Conversely, the housing allowance will not be reduced if the assignee’s actual costs are less. Also, the housing allowance will be fixed for the duration of the international assignment.
5.3.3 Housing
Assistance for transportation in the host location will be based on continuing to provide the benefit applicable under the home firm member policy (‘home country basis’).
Also, any additional benefit may be provided considering business needs for the assignee’s role in the host location.
Expatriate policy
Separate from the home country equivalent benefit (above), the assignee may be provided an additional benefit if he or she is in a materially detrimental position compared to what would have been experienced in the home country had the international assignment not taken place. For example, inability to lease a car or obtain insurance, or to do so at a ‘reasonable’ rate.
The provision of any host country transportation benefit may be amended/withdrawn if the assignee has taken a car to the host location.
Operating expenses (such as insurance, maintenance, and fuel) during KPMG business will be reimbursed via the host country expense system.
This benefit is subject to the following parameters:
Other aspects
Storage of home country personal belongings
The benefit (home country equivalent or expatriate) may be in the form of a car (e.g., fleet car, lease, rental, etc.), to reimburse the assignee for costs, or via an allowance.
If the home-country benefit cannot be replicated (e.g., a fleet car is provided in the home country and no such system operates in the host country) then a substitute benefit will be provided. The aim of the substitute benefit is to provide the assignee with equivalent benefit enjoyed in home country prior to the international assignment. However, there may be no assistance for host country transportation if there is no such benefit provided by the home member firm per their compensation policies.
5.3.4 Host country transportation
The provision of a benefit for the cost of educating an assignee’s children in private schools is only appropriate where KPMG considers the government-subsidized host country education facilities to be inadequate (e.g., language requirements or curriculum differences for the child to re-enter the home-country education system).
In some circumstances (e.g., appropriate level of schooling is not available in the host country), it may be preferable for an assignee’s children to remain in the home location (e.g., attend boarding school). In such circumstances the benefit would not include any accommodation-related costs.
5.3.5 Children’s education assistance
Home leave trips are provided to help assignees maintain internal and external connections in the home country and facilitate reintegration. The standard home leave
benefit is:
Other aspects are:
5.3.6 Home leave
When the host location has a location allowance (see section 5.3.2) calculation of 20 percent or more, this benefit becomes available. The intent of the R&R trip is to provide a break from living in a difficult environment and includes the following:
5.3.7 Rest and relaxation leave
Dependent children under age 25 who are full-time students and remain in the home country during the international assignment are provided a benefit to visit the assignee in the host location. The benefit includes:
5.3.8 Children’s visits to the host country
All home country professional licensing fees, memberships, etc., will continue to be subject to the home member firm policies throughout the international assignment. Conversely, any qualifications, licenses, etc., required by the laws and/or regulations of the host country will follow the policies of the host member firm.
5.3.9 Professional memberships/ licensing
All home country and host country training requirements will be governed by the policies of the respective member firms throughout the international assignment.
5.3.10 Training
An emergency leave benefit is provided for either compassionate reasons or other reasons per the table below:
The benefit, for both categories above, includes:
5.3.11 Emergency leave
Assignees eligibility for club membership benefits is based on the host member firm policy applicable to peers at the same level in the host country including the applicable institutions and parameters regarding costs. The provision of such memberships is designed to expose the assignee opportunities to further KPMG business.
5.3.12 Club memberships
This benefit is subject to business leader approval as it is only provided under the following specific circumstances:
1. Must necessitate the individual(s) to be physically present in the host location, i.e. virtual presence is unacceptable.
2. Examples would include in-person client/internal meetings, required for assignee’s role to be approved. This may be as part of the international assignment approval process or to facilitate integration.
3. Examples include house hunting and/or school selection/ interview/testing in host country location. This would only be approved when the international assignment has a very high probability of going ahead.
KPMG will bear the cost of expenses related to immigration compliance for the assignee and any accompanying dependents, for example: visas, work permits (assignees only), notarization or certification of documents, background checks and travel expenses to consular offices.
However, the cost of a passport or other regular travel documents are the responsibility of the assignee.
Assignees must comply with all applicable immigration laws and regulations and must not depart from their home country until clearance has been provided by the host member firm.
5.4 Pre-assignment and relocation
5.4.2 Immigration
In some countries there is a requirement for a medical examination/certification and/or inoculations (e.g., as part of the immigration process). Assignees, and accompanying dependents, may also choose to undergo such procedures voluntarily, as part of the move to the host country based on specific individual and/or international assignment circumstances.
The expenses of storing personal belongings, including packing, transportation, and insurance while in storage during the international assignment, will be reimbursed when the assignee’s home residence has not been left vacant (including disposed of or rented).
Other costs (not provided)
Other resources and information
Travel insurance
No reimbursement is provided for any other costs related to the home country residence, such as property management or home sale.
The storage benefit is subject to limitations, restrictions and exclusions, including, but not limited to:
KPMG will reimburse reasonable costs not covered by insurance.
5.4.3 Medical exams and inoculations
5.4.4 Home country residence
This benefit is designed to compensate the assignee for financial loss due to a disposal of a car in the home location, by either sale or breaking a financing agreement (such as a lease prior to maturity). The calculation of the benefit is:
5.4.5 Car disposal at home country
An assignment orientation provides an opportunity to manage assignee (and accompanying dependents, if applicable) expectations, disseminate important information, and help address any concerns. There are two different types of assignment orientation: an outbound (in the home country) and an inbound (in the host country), both conducted by respective GMPs.
Other specialists — such as benefits or payroll experts, for example — should attend the orientations when possible. There is generally a separate tax briefing conducted by a KPMG tax professional (see section 5.6.2).
They can be conducted in person (preferably) or virtually, with the outbound one ideally conducted prior to departure, the inbound as soon as possible at the start of the international assignment. The orientations should include discussion on a variety of topics, examples of which are outlined below:
5.4.6 Assignment orientations
The assignee should have a security briefing when this is considered necessary (e.g., the host country is considered a high-risk location), prior to departure. The briefing will be conducted by internal security resources or the firm-designated security organization (International SOS at the time of writing).
The firm-designated security organization provides emergency medical and security assistance to all KPMG professionals traveling internationally (including assignees). Online resources are available, and all assignees are urged to take advantage of the material published and obtain KPMG’s membership details. Note that these services are for emergencies only, as duly authorized by KPMG, and are not, therefore, a substitute for individual medical and accident insurance.
5.4.7 Security briefing
The host country will decide upon the most practical and cost-effective way to travel to the host location. The standard mode of transportation for assignees (and accompanying dependents, where applicable) is air travel but the host member firm may approve alternatives (e.g., train or assignee’s own car) where practical and
cost-effective.
Type of temporary accommodations (e.g., whether there are kitchen facilities).
Designated time spent with representatives (up to a maximum of one business week, but could be less);
Applicable fees (including caps); and
Services to be provided.
Assignee grade-level;
Host location; and
Family size.
The difference in the actual sale proceeds and the fair market value (as determined by an official professional data source acceptable to the home member firm) for a sale;
The actual cost and penalties incurred as a result of breaking a financing agreement;
Subject to a maximum of 15 percent of the fair market value of the car; and
Limited to one vehicle for a single assignee or two vehicles for an accompanied assignee.
Excess baggage;
Air shipment; and
After moving out of permanent accommodation but before departure from the host country; and
After arrival in the home country but before the home residence is available (e.g., tenants have not vacated the property or because the assignee’s furniture shipment
has yet to arrive).
Surface shipment.
Economy class tickets should be booked for air and train travel. When travelling by air it should be via the most direct route (no stopovers) and round-trip tickets
where appropriate.
Reasonable travel time can be charged to ‘working hours’ (up to one day). Travel time should still be charged, as a default, to the home member firm.
Other travel arrangements should be made per the host member firm business travel policy, including ground transportation to and from airports/station, or mileage allowances, and subsistence expenses.
Assignees should be provided travel insurance, which would typically be arranged automatically when travel arrangements are made via the relevant member firm designated travel system (e.g., when booking flights). If travel insurance is not automatically provided, it is the home member firm’s responsibility to arrange it. However, if any assignee does not book travel with the firm-designated travel system/ provider they are responsible for both arranging for, and bearing the costs of the travel insurance.
Border control travel costs
Excess baggage
Related mandatory border-control costs (required by the host country laws and regulations) will, as a default, be borne by KPMG. These costs may be imposed on a temporary basis by the host country (in response to an emergency situation) or be a long-term standard arrangement. However, the assignee should not incur such expenses and expect them to be reimbursed without prior pre-approval, which will be based on host member firm policy.
Assignees must not travel to the host country until immigration clearance has been provided by the host member firm (see section 5.4.2).
5.4.8 Travel to the host location
The most appropriate and cost-effective way for the assignee to transport personal belongings (i.e., excess baggage, air shipment or surface shipment) will be based on the facts and circumstances of the international assignment, including:
Excess baggage expenses for the assignee will be paid by the firm for up to four pieces of luggage, less any baggage allowance provided with the assignee’s airline ticket. So, if the airline free allowance for the assignee is one checked bag, excess baggage expenses can be claimed for three pieces of luggage. This applies whether the assignee is single or accompanied. Excess baggage costs are also subject to a maximum set by the host member firm.
Air shipment/surface shipment
This benefit requires prior approval and is provided based on the facts and circumstances of the international assignment (including whether furniture has to be shipped and number of accompanying dependents). If provided, the maximum standard parameters are outlined below:
Furniture allowance in lieu of shipping
Pet shipment (not provided)
Accommodation/lodging
Meals and incidentals
This benefit is only applicable if the host member firm determines that both:
No costs are reimbursed for pet shipment.
The shipping benefit includes habitual ancillary services, such as packing, intermediary storage (upon departure and arrival), customs clearance process, delivery, unpacking and insurance. However, it excludes dismantling and/or re-assembling furnishings.
For either rental or purchase, host member firm pre-approval is required and is subject to limitations. Provision of this benefit does not preclude a shipping benefit to be provided for other goods (excluding furniture/ major appliances). Rental costs will require ongoing payment (e.g., an allowance) and purchase via a one-off payment (which should be completed within the first three months of the international assignment). Any purchased furniture will be the property of the firm to be disposed of per host country policy at the end of the international assignment.
See Appendix C for a list of items typically included and excluded.
The shipping benefits are also subject to limitations, restrictions and exclusions, including, but not limited to:
The standard parameters for each type are set out in the sub-sections below.
5.4.9 Transportation of personal belongings
The temporary living period is for up to one month, which encompasses time spent both:
A GO Daily Allowance is paid to the assignee for each calendar day throughout the temporary living period to compensate for the additional costs of living in temporary accommodation. The rate of the allowance is set by the host member firm, using a standard global data source and methodology from a designated external service provider (Mercer at the time of writing), utilizing the following criteria:
Transportation
Services
Assistance with transportation during the temporary living period is based on host member firm policy (e.g., car rental or provision of a pass for public transportation),
if applicable.
Assistance in securing host country housing is included as part of the destination services benefit (see section 5.4.11).
In addition to travel time (see section 5.4.8), one business week (usually 5 days) paid leave is granted to help the assignee settle into the host location. Time off should be charged, as a default, to the host member firm. The assignee may take these days immediately or when moving into permanent accommodations, if this is later, or a combination of both, but must be taken within the first three months of the international assignment start-date.
Fees
Any benefit provided to the assignee associated with fees for securing host country housing (including obtaining a lease), and set-up (such as connection of utilities), is based on the policy in place at the time of the host member firm. This includes predetermined criteria (such as cost limitations) and usually only provided when such fees are habitually required to secure housing.
Deposits
The assignee is also entitled to a loan to cover any deposits (e.g., first/ last month’s rent) that are necessary to secure the rented property, based on host member firm policy (subject to limitations). The loan must be repaid, and the deposit refunded in full by the end of the international assignment (see section 5.4.4).
Travel insurance
Assignees should be provided travel insurance, which would typically be arranged automatically when travel arrangements are made via the relevant member firm designated travel system (e.g., when booking flights). If travel insurance is not automatically provided, it is the home member firm’s responsibility to arrange it. However, if any assignee does not book travel with the firm-designated travel system/ provider they are responsible for both arranging for, and bearing the costs of the travel insurance.
Border control travel costs
End of lease
Related mandatory border-control costs (required by the home country laws and regulations) will, as a default, be borne by KPMG. These costs may be imposed on a temporary basis by the home country (in response to an emergency situation) or be a long-term standard arrangement. However, the assignee should not incur such expenses and expect them to be reimbursed without prior pre-approval, which will be based on home member firm policy.
These services are provided to assist in settling into the host location, where the assignee does not have same access to market as locals, and required to make their own housing arrangements, etc.
Examples of the provided services includes finding and securing accommodation (including type of lease), connection of utilities, setting up bank accounts, introduction to social organizations, orientation to the public transportation system, shopping places, healthcare providers, etc.
The provision of these services is based on host member firm policy, which will set parameters such as:
These services are available only once during an international assignment.
In addition to information provided during the onboarding process in the host member firm, the assignee may also be provided services by a firm-designated service provider.
This benefit is available only once during the international assignment.
Provision of this benefit will be assessed together with any on-going host country transportation assistance (see section 5.3.4) to ensure there is no duplication.
5.4.10 Temporary living
5.4.11 Destination services
5.4.12 Securing host country accommodation
5.4.13 Time off upon arrival
As each international assignment is unique the costs incurred by a given assignee will vary based on the particular facts and circumstances. This relocation payment is intended to be applied to any costs incurred in moving to and settling into the host location that are not specifically addressed by other elements of this policy.
The relocation payment is a fixed one-time allowance paid in host currency. The host member firm uses a standard global data source and methodology to determine the relocation payment, which considers the following factors when producing the data:
5.4.14 Relocation payment
This one-time allowance is provided to any assignee who is accompanied by his or her spouse/domestic partner to settle into the host location (e.g., towards the costs of pursuing professional careers, resuming education or engaging in volunteer activities).
The standard allowance is USD 3,000 (or host country equivalent). The assignee is not required to provide receipts to qualify for the allowance.
This allowance will not be paid when the spouse/domestic partner has secured a role in the host member firm (as a local hire, an assignee or as a personal temporary international move); also, the allowance will not be paid if he or she is an assignee with another organization.
5.4.15 Accompanying spouse/ domestic partner allowance
On a case-by-case basis, the host or home member firm may approve assignee language training with a designated external service provider. Where language training is approved the associated costs are paid by the firm within the agreed parameters.
The host member firm may test language ability as part of the international assignment approval process. The assessment will determine if the assignee is at the minimum host country required proficiency level to operate in the business, and language training may be stipulated as a requirement for the international assignment to proceed.
5.4.16 Language training
KPMG retains the services of a specialist cross-cultural awareness organization (Culture Wizard at the time of writing) to provide online resources that are available to the assignee, including host country information. Assignees are strongly encouraged to access the materials online, which have been pre-paid by KPMG.
5.4.17 Cross cultural training
See section 1.3.2 regarding relevant policy application for repatriation provisions.
5.5 Repatriation
This benefit is designed to compensate the assignee for financial loss due to a disposal of a car in the host location, by either sale or breaking a financing agreement
(such as a lease prior to maturity).
However, no assistance will be provided in a host country where the member firm domestic transportation policy (that applying to local hires) excludes a car benefit, even if assignee purchased a car.
The calculation of the benefit is:
5.5.1 Car disposal at host country
The mode of travel to the host country at the beginning of the international assignment (see section 5.4.8) is applicable when the assignee returns home, and accompanying dependents where applicable (including utilizing the return tickets of a round-trip booking, where appropriate).
Reasonable travel time can be charged to ‘working hours’ (up to one day). Travel time should be charged, as a default, to the host member firm.
Other travel arrangements should be made per the home member firm business travel policy, including ground transportation to and from airports/station, or mileage allowances, and subsistence expenses.
If new travel arrangements are required, economy class tickets should be booked for air and train travel. When travelling by air it should be via the most direct route
(no stopovers).
5.5.2 Travel to the home location
5.5.3 Host country residence
5.4.1 Pre-assignment trip
When applicable, the trip is provided with the following parameters:
If this trip includes accompanying dependents, it is recommended that it is combined with any destination services provision (see section 5.4.11).
See also section 5.4.4 for storage of personal belongings.
Temporary accommodation will be provided for the assignee and accompanying dependents (if applicable).
The type of accommodation provided is based on host member firm policy (such as a hotel or serviced apartment).
Payment of this allowance should not be withheld if the spouse/ domestic partner has to delay relocation to the host country and/or repatriate early (e.g., due to career, children’s schooling needs). However, to qualify for the allowance, the spouse or domestic partner must be in the host country with the assignee for the vast majority of the international assignment.
The host member firm will assist with negotiating a lease break should the international assignment terminate early. Any fees or penalties charged for early lease break will be paid by the firm if it occurred due to business reasons. In addition, standard end-of-lease costs at the conclusion of the international assignment will be paid by the firm. The payment of the lease break and end-of-lease costs by KPMG is conditional on the assignee having fulfilled his or her responsibilities.
Deposits
The host member firm will also provide assistance (where required) to reclaim deposits from the assignee’s landlord. However, KPMG will not reimburse the assignee for deductions due to cleaning fees or damages. Assignees must repay any outstanding loans and advances, if applicable (see section 5.4.12), to the firm before leaving the
host country.
5.5.4 Transportation of personal belongings
The assignee’s personal belongings will typically be transported back to the home country in the same way they were sent to the host location at the start of the international assignment (see section 5.4.9). Also, the same parameters apply (albeit based on home member firm policy) for:
5.5.5 Temporary living
The temporary living period is for up to one month, which encompasses time spent both:
5.5.6 Home country residence
Storage of home country personal belongings
Pet shipment (not provided)
Accommodation/lodging
Meals and incidentals
No costs are reimbursed for pet shipment.
Temporary accommodation will be provided for the assignee and accompanying dependents (if applicable).
A GO Daily Allowance is paid to the assignee for each calendar day throughout the temporary living period to compensate for the additional costs of living in temporary accommodation. The rate of the allowance is set by the home member firm, using a standard global data source and methodology, utilizing the following criteria:
The type of accommodation provided is based on home member firm policy (such as a hotel or serviced apartment).
Family size (separate rates are applied to children up to twelve years old);
Home location; and
Type of temporary accommodations (e.g., whether there are kitchen facilities).
Designated time spent with representatives;
Applicable fees (including caps); and
Services to be provided.
Intended to be applied to any costs incurred in moving back to and resettling into the home location that are not specifically addressed by other elements of this policy;
A fixed one-time allowance paid in home currency;
Determined by the home member firm, also using a standard global data source and methodology, based on assignee grade-level, home location and family size.
Tax briefing sessions, in both the home country and host country, at the start of the international assignment and again before repatriation;
Preparation of host country and home country tax returns (including any necessary ancillary services such as extensions), although home country tax returns will only be prepared if the home country includes the assignee’s KPMG compensation (e.g., they will not be prepared on a non-resident basis when only personal income is included);
Preparation of tax settlement calculations (if necessary);
Handling of inquiries from taxing authorities that impact tax on the assignee's KPMG compensation related to the international assignment; and
Assistance with audits/examinations/notices issued by tax authorities relating to KPMG compensation.
Hypothetical withholding, for equalization (standard) compensation methodology; or
Part of the target net compensation methodology calculation.
Transportation
Assistance with transportation during the temporary living period is based on home member firm policy (e.g., car rental or provision of a pass for public transportation),
if applicable.
If a storage benefit was provided as part of the relocation to the host country (see section 5.4.4), the cost of retrieving of items stored in the home country during the international assignment (including delivery and unpacking) will be reimbursed.
Securing home country accommodation
If the home county residence was not retained during the international assignment, the assignee may be provided house-hunting services by a firm-designated service provider, based on the home member firm domestic relocation policy. Such a policy will set parameters such as:
Stored items must be retrieved within two months of assignee’s repatriation to the home country.
5.5.7 Time off upon arrival
In addition to travel time (see section 5.5.2), one business week (usually 5 days) paid leave is granted to help the assignee settle into the home location. However, time off should be charged, as a default, to the host member firm. The assignee may take these days immediately or when moving into the home residence, if this is later, or a combination of both, but must be taken within the first three months of the international assignment end-date.
5.5.8 Repatriation payment
5.6 Taxation and social security/ insurance
The repatriation payment is the relocation payment (see section 5.4.14) ‘in reverse’. Therefore, it is:
5.6.1 Tax policy
As KPMG utilizes two alternative compensation philosophies for international assignments (home-based and host-based – see section 1.2.2), there are two corresponding tax policy approaches: the ‘home-basis tax approach’ and the ‘host-basis tax approach’.
5.6.2 Tax compliance services
KPMG’s Global Mobility Services department (GMS) provides tax compliance services to the firm’s assignees. The services include the following (as applicable):
5.6.3 Social security/ insurance
Employee costs
As home-equalized assignees are provided home-based compensation, KPMG also adopts the home-basis tax approach.
The objective of the home-basis tax approach is to ensure that an assignee does not pay substantially more or less tax on KPMG compensation than he or she would have paid had the assignee remained working in the home country.
As part of the ‘home-basis tax approach’ (see section 5.6.1) the assignee’s responsibility regarding costs is limited to the equivalent of the amount that would be payable had the international assignment not taken place (‘hypothetical social taxes on stay-at-home KPMG compensation’).
KPMG is responsible for the worldwide employee social taxes (host country and home country) in excess of the assignee’s responsibility (hypothetical taxes) on all the assignee’s KPMG compensation.
Any voluntary employee contributions made by the assignee into either the home country or host country systems are entirely his or her responsibility.
The home-basis tax approach is achieved in two different ways, depending on the compensation methodology utilized (see section 5.1.1):
Personal Temporary International Move
6
6.1 Overview
6.1.1 Compensation package
A personal temporary international move is offered when the host member firm is accommodating a personal request to work in a host location and when there is no business case/ business need for the individual (e.g., there are existing resources within the member firm that are available).
‘Personal requests’ do not include talent development, but examples include, but are not limited to, accompanying a spouse/ domestic partner who is living or working in the host location or moving to a country to help with aging parents.
This package is therefore not applicable when the host member firm offers an individual a role (and they are currently working for their home member firm in another country) because their expertise is needed and/or there are no resources available in the host member firm.
Therefore, a personal temporary international move is not to be used as a less expensive alternative to an international assignment and cannot be used for any specific global mobility programs (see section 1.1.2). Also, the assumption is that when a role is offered by the host member firm it is an international assignment and not a personal temporary international move, unless the host member firm specifically states that they are accommodating a personal request.
The compensation package offered is a host-based methodology (see section 1.2.2), which is supplemented by a narrow range of move-related allowances and benefits for relocation, during the international assignment and repatriation to the home country. The package is designed to provide the individual with a similar standard of living in the host country enjoyed by his or her local peers.
6.1.2 Duration
The standard minimum duration for this move is one year, with a maximum duration of two years. An individual may request a move of between three and twelve months, but it will be approved at the sole discretion of KPMG.
6.1.3 Grade-level
Any grade/level of KPMG personnel, including employees and partners are eligible for this international move.
6.1.4 Family
6.2.1 Base salary
6.2 Compensation and benefits
These moves are only offered on single status (unaccompanied basis). Therefore, no expense reimbursements, or any other support, will be provided for family members should they choose to accompany the individual in the host country location for the international temporary move.
Due to the personal nature of such moves, the individual is responsible for all income tax and social taxes on all KPMG compensation, including any move-related allowances and benefits (see section 6.6.1).
The individual’s pay is delivered via the host country payroll (active payroll). It may also be necessary to operate a shadow payroll in the home country if there are remittance requirements (e.g., employee benefits, income tax and social security).
The individual will receive a salary as offered by the host member firm based on its standard policies and practice for local employees (host-peer basis), considering the individual’s experience and responsibilities. Increases in the host base compensation during the international assignment would be implemented as part of the standard performance and pay review in the host member firm.
6.3.1 Host country transportation
6.3 On-going international move allowances and benefits
Provision of assistance for transportation in the host location will be based on host firm member policy applicable to local hires (host country basis), as part of the short-term employee benefits package (see section 6.2.3), considering business needs for the individual’s role in the host location.
6.4.1 Immigration
6.4 Pre-move and relocation
KPMG will bear the cost of expenses related to immigration compliance for the individual (for example, visas, work permits, notarization or certification of documents, background checks and travel expenses to consular offices).
However, the cost of a passport or other regular travel documents are the responsibility of the individual.
Individuals must comply with all applicable immigration laws and regulations and must not depart from their home country until clearance has been provided by the host member firm.
6.3.3 Training
All home country and host country training requirements will be governed by the policies of the respective member firms throughout the international temporary move.
6.4.2 Medical exams and inoculations
In some countries there is a requirement for a medical examination/certification and/or inoculations (e.g., as part of the immigration process). In such circumstances (mandatory requirement) KPMG will reimburse reasonable costs not covered by insurance (although the amount may be subject to a maximum).
The benefit may be in the form of a car (e.g., fleet car, lease, rental, etc.), to reimburse the individual for costs, or via an allowance. However, there may be no assistance for host country transportation if there is no such benefit provided by the host member firm per their compensation policies.
The provision of any host country transportation benefit may be amended/withdrawn if the individual has taken a car to the host location.
Operating expenses (such as insurance, maintenance, and fuel) during KPMG business will be reimbursed via the host country expense system.
6.2.2 Incentive compensation
The individual will be eligible for the incentive compensation plans offered in the host location (host-peer basis).
6.2.3 Employee benefits
For the provision of employee benefits, there is a distinction between the following:
6.2.4 Working hours and time off
As a default, all working arrangements and time off follow host country policy, including, but not limited to annual leave/ personal time off/ vacation, public and company holidays, maternity/ paternity/ parental/adoption leave, other paid or unpaid time off and working hours. This default position is subject to the laws and regulations of the host and home country, as appropriate.
6.3.2 Professional memberships/ licensing
Any qualifications, licenses, etc., required by the laws and/or regulations of the host country will follow the policies of the host member firm. However, all home country professional licensing fees, memberships, etc., are the responsibility of the individual.
Any outstanding leave balances accrued and remaining in the home country before the start of the international temporary move are treated in accordance with home country policy (e.g., carrying over until repatriation, paying them out).
Pay delivery
See Appendix B for a categorization of short-term and long-term employee benefits.
When necessary, alternative arrangements will be made (to the default position as stated in the table above), between the home and host member firms, with the aim to leave the individual broadly no better or worse off. Examples of when the default position would have to be amended include, but are not limited to:
Changes to benefit provision may include discontinuing certain provisions, providing substitute plans (e.g., international medical insurance), or providing additional benefits.
See section 1.2.2 regarding the refund of any host-country KPMG-funded contributions.
If it is not possible to continue to provide a particular benefit to an individual (e.g., country legal restrictions do not allow participation by a non-resident so he or she is ineligible);
An existing home country benefit is insufficient/invalid due to the individual living in the host location; and
The split provision (‘short-term home’ and ‘long-term host’) results in either gaps or duplication in benefits.
Individuals may also choose to undergo such procedures voluntarily. Any fees related to non-mandatory medical exams/ inoculations will not be reimbursed and are the responsibility of the individual.
Other resources and information
Travel insurance
Excess baggage
Other costs (not provided)
Travel insurance
Excess baggage
Other costs (not provided)
Employee costs
Border control travel costs
Border control travel costs
6.4.3 International move orientations
6.4.4 Security briefing
6.4.5 Travel to the host location
6.4.6 Transportation of personal belongings
6.4.7 Cross cultural training
6.5 Repatriation
6.5.1 Travel to the home location
6.5.2 Transportation of personal belongings
6.6 Taxation and social security/ insurance
6.6.1 Tax policy
6.6.2 Tax compliance services
6.6.3 Social security/ insurance
An international move orientation provides an opportunity to manage individual expectations, disseminate important information, and help address any concerns. There are two different types of international move orientation: an outbound (in the home country) and an inbound (in the host country), both conducted by respective GMPs.
Other specialists — such as benefits or payroll experts, for example — should attend the orientations when possible. There is generally a separate tax briefing conducted by a KPMG tax professional (see section 6.6.2).
The individual should have a security briefing when this is considered necessary (e.g., the host country is considered a high-risk location), prior to departure. The briefing will be conducted by internal security resources or the firm-designated security organization (International SOS at the time of writing).
The firm-designated security organization provides emergency medical and security assistance to all KPMG professionals traveling internationally (including those on temporary international moves). Online resources are available, and all individuals are urged to take advantage of the material published and obtain KPMG’s membership details. Note that these services are for emergencies only, as duly authorized by KPMG, and are not, therefore, a substitute for individual medical and accident insurance.
The host country will decide upon the most practical and cost-effective way to travel to the host location. The standard mode of transportation for individuals is air travel but the host member firm may approve alternatives (e.g., train or individual’s own car) where practical and cost-effective.
Economy class tickets should be booked for air and train travel. When travelling by air it should be via the most direct route (no stopovers) and round-trip tickets where appropriate.
Reasonable travel time can be charged to ‘working hours’ (up to one day). Travel time should be charged, as a default, to the home member firm.
Other travel arrangements should be made per the host member firm business travel policy, including ground transportation to and from airports/station, or mileage allowances, and subsistence expenses.
Individuals should be provided travel insurance, which would typically be arranged automatically when travel arrangements are made via the relevant member firm designated travel system (e.g., when booking flights). If travel insurance is not automatically provided, it is the home member firm’s responsibility to arrange it. However, if any individual does not book travel with the firm-designated travel system/ provider they are responsible for both arranging for, and bearing the costs of the travel insurance.
Related mandatory border-control costs (required by the host country laws and regulations) may be borne by KPMG at the sole discretion of the host member firm. These costs may be imposed on a temporary basis by the host country (in response to an emergency situation) or be a long-term standard arrangement. However, the individual should not incur such expenses and expect them to be reimbursed without prior pre-approval.
The individual is allowed to claim excess baggage expenses for up to four pieces of luggage, either additional pieces above the airline’s free allowance, or overweight/ oversized items. Excess baggage costs are subject to a maximum set by the host member firm.
KPMG retains the services of a specialist cross-cultural awareness organization (Culture Wizard at the time of writing) to provide online resources that are available to the individual, including host country information. Individuals are strongly encouraged to access the materials online, which have been pre-paid by KPMG.
See section 1.3.2 regarding relevant policy application for repatriation provisions.
The mode of travel to the host country at the beginning of the international move (see section 6.4.5) is applicable when the individual returns home (including utilizing the return tickets of a round-trip booking, where appropriate).
If new travel arrangements are required, economy class tickets should be booked for air and train travel. When travelling by air it should be via the most direct route (no stop-overs).
Reasonable travel time can be charged to ‘working hours’ (up to one day). Travel time should be charged, as a default, to the host member firm.
Other travel arrangements should be made per the home member firm business travel policy, including ground transportation to and from airports/station, or mileage allowances, and subsistence expenses.
Individuals should be provided travel insurance, which would typically be arranged automatically when travel arrangements are made via the relevant member firm designated travel system (e.g., when booking flights). If travel insurance is not automatically provided, it is the host member firm’s responsibility to arrange it. However, if any individual does not book travel with the firm-designated travel system/ provider they are responsible for both arranging for, and bearing the costs of the travel insurance.
Related mandatory border-control costs (required by the home country laws and regulations) may be borne by KPMG at the sole discretion of the home member firm. These costs may be imposed on a temporary basis by the home country (in response to an emergency situation) or be a long-term standard arrangement. However, the individual should not incur such expenses and expect them to be reimbursed without prior pre-approval.
The individual is allowed to claim excess baggage expenses for up to four pieces of luggage, either additional pieces above the airline’s free allowance, or overweight/ oversized items. Excess baggage costs are subject to a maximum set by the home member firm.
Due to the personal rather than business purpose of these temporary international moves, the individual is responsible for all worldwide taxation on all income, comprising of personal income and all KPMG compensation (including any move-related compensation).
KPMG’s Global Mobility Services department (GMS) provides tax compliance services to the individuals on personal temporary international moves.
Due to the personal rather than business purpose of these temporary international moves, the individual is responsible for all worldwide social taxes on all income, (including any move-related compensation).
Tax briefing sessions are provided to the individual, in both the home country and host country, at the start of the international assignment and again before repatriation.
No other costs are paid, including, but not limited to, air or surface shipment, pet shipment, or storage.
The individual cannot claim for any other related costs, including but not limited to air or surface shipment, pet shipment, storage, furniture rental/allowance and shipment of pets.
Individuals must not travel to the host country until immigration clearance has been provided by the host member firm (see section 6.4.1).
They can be conducted in person (preferably) or virtually, with the outbound one ideally conducted prior to departure, the inbound as soon as possible at the start of the international move. The orientations should include discussion on a variety of topics, examples of which are outlined below:
Appendix A – Definitions
A
Appendix B – Employee benefits – short term and long term
B
The table below outlines whether, for the purposes of this policy, employee benefits are considered short term or long term. This impacts the provision of such benefits (see sections 2.2.3, 3.2.3, 4.2.3, 5.2.3 and 6.2.3).
Notes
1. Categorization depends on the length of the absence
2. For example: required full-time military service
3. For example: jury duty
Home member firm responsible for home country; host member firm responsible for host country
Appendix C – Shipping & furniture allowance – items included/ excluded
C
Certain restrictions and exclusions apply when the assignee is receiving shipping as part of the benefits provided by the firm (see sections 4.4.9 and 5.4.9). Should the assignee wish to ship any such excluded items all related charges and expenses (including insurance) would be the responsibility of the assignee. In addition, KPMG will not accept any loss or damage claims for these items.
Generally, items are excluded based on issues such as cost, practicality, legal concerns (e.g., items that are unlawful to import or possess in the host country), health and safety concerns, items excluded by the transportation and insurance companies and purpose. There will be differences based on the facts and circumstances of the particular international assignment, but as a general guide the items listed below would not be approved:
Note that the above list is not exhaustive, and, in addition, the assignee may not be allowed to ship certain items due to relevant host country regulations, legislation and/or other procedural import controls.
However, as a general guide, the typical items that should be included and excluded from this benefit are listed in the tables below:
When an assignee is provided with a furniture allowance (for purchase or rent in lieu of shipping) as part of this policy (see sections 4.4.9 and 5.4.9), it is subject to pre-approval by the host member firm. The provision of the benefit will be based on the facts and circumstances of the international assignment, including the accommodation provided and the cost of shipping.
Shipping exclusions
Furniture allowance – items included & excluded
All flammable items such as paints, varnishes, aerosol cans, combustible liquids, corrosives, and explosives;
Liquid propane tanks, and scuba tanks;
Ammunition, firearms and fireworks;
Illegal substances;
Pornographic material;
Automobiles, motorcycles, recreational vehicles, airplanes and gliders, boats, boat kits, inboard marine engines outboard motors and related automotive equipment;
Riding mowers and tractors;
Food stuff, other perishable items;
Drinking alcohol;
Non-household animals;
Plants, shrubs and trees;
Bulky/heavy low value to weight ratio items such as cordwood, brick, sand, lumber and other building materials, and utility sheds;
Bulky/heavy wood working shop equipment or other hobby equipment of similar nature;
Swing sets, climbing gyms, and playhouses;
Satellite television/radio receiving discs/dishes, and related equipment;
Hot tubs, spas, whirlpool baths, and saunas;
Major household appliances (e.g., refrigerators, freezers, stoves, washers, and dryers);
Antiques, collector’s items, pianos, valuable works of art, jewelry, and other items of high value, including luxury items;
Any item intended for resale or private business use; and
Personal and household effects, furniture or other articles, not for the assignee’s (or family’s) own use.
