Global Entry program: intelligence briefing for business visitors/travellers to the US

09 September 2016

The US Customs and Border Protection (CBP) agency recently announced the ‘Global Entry’ program, which enables approved individuals to jump the queues at immigration when entering or leaving the country. The program provides expedited clearance for pre-approved, low-risk travellers upon arrival in the United States, with entry through automatic kiosks at selected airports, including Boston-Logan International Airport (BOS), Chicago O'Hare International Airport (ORD), Los Angeles International Airport (LAX), John F. Kennedy International Airport, New York (JFK), Washington-Dulles International Airport (IAD), and several others.

At US airports, members of the program will be allowed to proceed to Global Entry kiosks, present their machine-readable passport or US permanent resident card, place their fingerprints on the scanner for fingerprint verification and complete a customs declaration. The kiosk issues the traveller a transaction receipt and directs the traveller to baggage claim and the exit.

For multi-national businesses and specifically business travellers who frequently visit the US, this could prove to be a great time-saver. Any non-US citizen who has ever found themselves stuck in a queue at US customs prior to or following a lengthy transatlantic flight will surely be keen to find out more.

Travelers must be pre-approved for the Global Entry program. All applicants undergo a rigorous background check and in-person interview before enrolment. Up until now, interviews have only been conducted in the US but from the end of the month it will be possible to attend an interview at the US embassy in London. For details on how to register and the associated costs, use this link – https://global-entry.beta.homeoffice.gov.uk/register-to-apply/

Although this program is intended to be helpful to business travellers, there are some important considerations to be made, for example:

Is the program worth the effort and cost of applying?

This will depend on each individual’s attitude towards queues at customs but presumably for those who make more than 3 or 4 trips a year to the US, it rapidly becomes a no-brainer.

Do the duties performed by business travellers give rise to any personal tax obligations in the US?

In theory, a US non-resident can be liable to US federal and/or state income tax in respect of duties physically performed in the US. In many cases a tax exemption may be available but it is unwise to simply assume this will be the case. The level of exposure and the practicalities of dealing with income tax obligations will depend on the facts and circumstances of each case. However, the lengthier and more frequent the trips, the greater the risk. To avoid any nasty surprises it is always a good idea to talk to a tax advisor.

Are there any US corporate tax implications for my employer?

Potentially, though not in most cases. Depending on the nature of activities undertaken whilst in the US and the location where duties are performed, it is possible an employee’s activities could give their foreign employer a taxable presence in the US. If you or your employee(s) undertake regular business travel to the US it is a good idea to check with an advisor.

We recommend that business travellers look into the Global Entry programme if they are keen to save time during US visits. Before registering with the authorities, it is important to seek advice to ensure you are not creating unanticipated US compliance issues for you or your employer. Contact a member of our team for an initial free of charge consultation.

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