Hiring freelancers can be a great choice for a startup as this will allow you to save a lot of money. This can also give your new company a great boost due to top-grade talent, which might not be available within your city. However, paying your freelancers can be a challenge, especially if it involves international money transfers. Establishing the most efficient, safe, and cheap payment routes is essential to make working with these professionals truly cost-efficient for your business. In order to ensure you get the best deal, you need to choose the method, ensure your startup has enough flexibility to use it, and think hard on the currencies you use.
3 Essential Tips for Saving Money When Paying Freelancers Overseas
Choose the currency wisely
First of all, you need to determine whether to pay your remote employees in the currency of your country, their country, or some other option. Note that it’s not your personal convenience that will play the biggest part in this decision. Some countries require some transfers to be in their currency only. Therefore, you need to research the legal requirements for foreign money transfers to the country first.
Most likely, you’ll need to exchange currency for the transfer. In many cases, this means that the sender of the money incurs an additional cost for this. Negotiate this with your employee so you can settle the actual sum you need to pay vs. the one they will receive. Consider the currency exchange rates and additional fees to determine if hiring a freelancer from overseas is truly cost-efficient.
Choose the right money transfer service
To make international payments to your remote workers as stress-free and heap as possible, you need to research and compare leading online money transfer service providers. Focus on studying detailed reviews that list both the pros and cons of the service. You also need to check out the service’s website to find out the current rates and terms. For example, see what PayPal and TransferWise have to offer.
However, don’t forget that you need to consider the freelancer’s needs as well. Some money transfer services are only available in several countries, so you standard ‘scheme’ might not work for all of your employees.
Once you work out the list of available services, choose the one that offers the best deal on fees. Only use the leading accredited services as you have to be 100% sure in the security of your transfers.
Make your startup flexible (and define your limits)
If you plan on working with an international team, you have to plan for financial flexibility from the start. This means researching what kinds of international payments you can make from your business account and what kind of paperwork you’ll need to prepare to get additional accounts.
Most importantly, you have to find out how to make those money transfers official so you don’t get in trouble with your taxes. Depending on where you live, it might be your or the freelancer’s responsibility to file some documents to register the transaction and later add it to their tax report.
Do this kind of research in advance so you can compile a list of the countries where hiring remote employees will cost you too much in the long run.