Essential factors for recruiters to consider when placing contractors abroad:
As a recruiter, there are several considerations to be made before placing a contactor internationally. We have put together a short list of essential factors to consider.
Tax and Residency laws:
Tax and residency laws are some of the most important considerations when placing a contractor abroad. Recruiters should seek specialist advice on the residency and tax laws of the jurisdiction in which they have not placed a contractor in the past. In particular, it is vital to consider tax residency and where the contractor is required to pay tax under the 183-Day Rule. Here at 3CGlobal, we offer expert advice on contracting across Europe. In Sweden, Germany, Denmark, Ireland, the UK and the Netherlands, we offer payroll solutions that are tailored to our contractors.
Insurance Policies
Before placing contractors, one should check that the insurance policy adequately insures the contractor's work in the jurisdiction they are working within. There may be variations and exemptions for standard professional indemnity policies in certain countries, so therefore, it is essential to seek advice. At 3C Global, our team can assist with insurance queries, ensuring our contractors are covered. Whether it is professional indemnity, public liability, medical cover or medivac, we can help.
Registering for VAT
All contractors are required to register for tax and VAT in the country in which they are operating. If a contractor is working in the same region where their client is based, they may have to charge VAT on their invoices. Suppose a contractor works in one country and the client they are invoicing is in another. In that case, VAT will generally be 0% on the invoice under the EU reverse charge mechanism. In either case, contractors are required to have an active VAT number.
Contracts:
The type of contract in which a contractor is engaged, whether a SOW contract or a contract for services, must comply with the country in which the contract is operated or delivered. There are many local obligations to be considered after placing contractors internationally. If you require assistance with contracts, our team is on hand to help.
Currencies:
Currencies can fluctuate due to many factors, which is essential to note as they can significantly impact your margin. One should set up a bank account in the currency they will work in to help manage the effects of fluctuations on one's margins. Working with a company that can process payments in the currencies applicable to you is also beneficial. At 3C Global, we work with and accept payments in a variety of currencies, ensuring that our clients' needs are met.
In Conclusion:
There are many important factors to consider when looking to place contractors abroad. Our team at 3CGlobal are on hand to assist with any queries and to guide recruiters through the essential considerations of placing a contractor in a specified country. Our knowledgeable team will help ensure that your contractor's placement fully complies with all taxation, immigration and legal guidelines. Contact our team today to get started.
