[asterisk-biz] OT: Paying people in faraway (Western) places.

[Alex Balashov]

Nitzan Kon wrote:
> --- On Wed, 1/7/09, Alex Balashov <abalashov at evaristesys.com> wrote:
> 
>> Or perhaps it is that I can't actually "employ" anyone in 
>> Britain without being an incorporated and legally present 
>> entity there, and must necessarily pay them as a contractor 
>> across international boundaries.
> 
> I'm pretty sure you cannot directly employ someone who lives in 
> Britain in an American company. For starters it's illegal for
> you to employ anyone without a valid working license in the US,
> not to mention you can't withhold taxes for Britain.

I figured there were provisions for this kind of thing.  Otherwise, 
everyone just does exactly what you are suggesting below, and the 
definition of 'employment' becomes sort of meaningless.

I'm guessing most people paying folks overseas sort of do it under the 
table, since they can't be 'employed' anyway, based on what you suggest. 
  Can't say I blame them;  if the dull-witted, facile bureaucrat 
prize-bulls in government can't figure out how to come up with a 
taxation system and labour law compatible with the basic requirements of 
a 21st century / globalised economy, I can't imagine what other than a 
middle finger would be much of the world's "de facto", reality-based 
response.

> The solution is either for you to open a UK branch and pay
> them locally in Britain which is possible but might expose
> you to different regulation and is a PITA to say the least,
> or the better solution is to have THEM open a UK company, 
> pay that company for their services, and let them worry 
> about paying themselves salary.

Yes, that would be easier, although that puts them in a position they 
don't want to be in.  Someone just wants to work and get a pay check; 
now they have to run a business, or at the very least a legal and 
accounting shell of one.  That seems like an onerous requirement.

> From a legal standpoint, you are just paying a vendor which
> is of course deductible, and it's 100% legal in both countries.

Well, I imagine that using them in the manner proposed probably doesn't 
formally abide by the contractor vs. employee distinction for tax 
purposes, but, I don't care.  If 'contract-to-hire' body shops can get 
away with it...


-- 
Alex Balashov
Evariste Systems
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