The UK’s Office for Tax Simplification (OTS) has opened a review into those who work abroad remotely, in a sign the government may soon begin to crack down on remote working holidays.

The OTS has begun collecting data on people who work for UK companies from abroad, following a major uptick in the numbers of people taking “workcations” and living as “digital nomads” since Covid-19.

The review will look at “emerging trends in hybrid and distance working, in the UK and across borders, and any pressures they put on existing tax rules and guidance,” the OTS said.

An array of top companies including Meta, Ocado, and Airbnb, have adopted “work from anywhere” policies following the widespread uptake of remote working at the start of the pandemic.

However, concerns around the tax implications of such practices saw a raft of top banks, including Citigroup, call workers back to the UK.

Simon McMenemy, managing partner at employment law firm Ogletree Deakins said the review “could have serious implications for employers.”

He explained that employers can be made liable to pay income tax and corporation tax in host countries, if they let their employees work from abroad.

Those working abroad are required to hold work visas for the countries they’re in, and in turn could be subject to their host country’s own employment laws.

Companies must also ensure they are complying with UK data protection rules if their employees are working from outside the EEA.