This article explains why specific COVI questions are asked when reviewing workation tax risk in WorkFlex. These questions help assess whether an employee could be considered a tax resident in the host country based on international tax principles.
When should you use this?
You should review these questions when:
• assessing tax risk for a workation
• evaluating potential dual tax residency situations
• determining where an employee’s centre of vital interests is located
• supporting compliance with international tax regulations
Why these questions are asked
When assessing workation tax risk, the central question is whether the host country could classify the employee as a tax resident under its domestic law.
If both the home and host countries could claim tax residency, the tie-breaker rules under Article 4 of the OECD Model Tax Convention are applied to determine which country’s claim takes precedence.
The duration of stay alone is not decisive. What matters most is whether the employee’s centre of vital interests - meaning their main personal and economic ties - can be considered to have shifted to the host country.
To evaluate this, WorkFlex uses four structured questions aligned with these criteria.
The four COVI questions explained
Permanent home
This question evaluates whether a permanent home is available in the host country.
• A permanent home is a primary indicator of tax residency
• It refers to a place that is continuously available to the individualOwnership of home
This question determines whether the individual owns residential property in the host country.
• Ownership indicates a stronger factual connection
• It reflects long-term presence and financial investment
• Property ownership carries particular weight, as it demonstrates structural presence in the countrySpouse, partner, or children
This question assesses where the individual’s close family members are located.
• Family location is a key indicator of personal ties
• It plays a central role in determining the centre of vital interestsBank accounts and tax payments
This question evaluates the individual’s economic connections to the host country.
• Bank accounts indicate financial activity
• Tax payments or liabilities show economic integration
Important
• These questions are based on international tax standards
• No single factor alone determines tax residency
• The assessment always considers the overall picture of personal and economic ties
• Together, these questions form a structured framework for determining where an individual’s life is anchored
Related topics
• Understanding risk assessments as outcomes
• Workation vs business travel
• The risks of traveling uncompliantly