August 12, 2021
Pennsylvania ends COVID-19 temporary business tax nexus and income tax withholding guidance for teleworkers
The Pennsylvania Department of Revenue announced that its temporary provisions governing the determination of nexus for Corporate Next Income Tax (CNIT), sales and use tax (SUT), and state income tax withholding for teleworkers during the COVID-19 emergency expires effective July 1, 2021. (See EY Tax Alert 2020-0996; Pennsylvania Department of Revenue website)
Guidance through June 30, 2021
Further, if a nonresident employee was temporarily working from home due to COVID-19 in a state that doesn't have a reciprocity agreement with Pennsylvania, the Department advised that the employee's compensation remained Pennsylvania sourced, and the employer was required to withhold Pennsylvania state income tax on the compensation.
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