As more economies around the world open up and companies bring employees back to the office, global expansion plans that may have been put on hold last year are now taking shape. It can be challenging to know where to start, but here are some key factors to consider when expanding your operations into new countries.
Business Entity Set-Up
Before you hire employees and get to work in a new country, your business entity in a new country must be established. Based on the industry and type of company, there are many options to consider, and many different tax and employment requirements based on the entity you choose.
Hiring In-Country Employees vs. Expats
Will you send some of your team from the U.S. or will you be hiring in-country employees? Tax and benefits vary based on the country you are operating in, so it’s important to understand the requirements, employment contracts, statutory benefits, and payroll regulations in each country before hiring employees or sending your US team to begin operations in a new country.
Payroll and Tax Deadlines
Every country has unique payroll and tax filing requirements and deadlines. Make sure your payroll team stays ahead of due dates and timelines to avoid tax audits or penalties for non-compliance. Ensure your payroll software is automating any updates to legislation that could affect your employee payroll or tax requirements.
Just like payroll and tax requirements, there are many different reporting requirements based on the country in which you are doing business. If you are using different systems or various in-country vendors to manage payroll, you will find the data and reporting will be inconsistent and in most cases manual each month. Using an integrated payroll platform is the key to getting customized, aggregated reporting each month for employees across all countries.
Global expansion is an exciting but challenging endeavor for every company. Using integrated tools and resources can simplify the process and make operations run smoother in the long run.
Author – Blue Marble Payroll