How to Pay International Contractors: 5 Easy Methods

They are often used for higher-value payments or when speed is a priority. Nonetheless, wire transfers typically come with fees, both for the sender and potentially for the recipient. Agreeing on a stable payment currency helps minimise uncertainty and may improve satisfaction. Consider platforms or systems supporting multi-currency payroll and competitive exchange rates where possible. Timing of payment is also key; consistent pay dates help both sides plan for changes in currency values. With a background in banking and finance, he is passionate about modern tech practices in payroll management and using global payroll platforms for global payments.

#5. Payment Platforms

From payment methods to legal compliance, you’ll gain valuable insights on how adjusting entries to pay international contractors. Formerly known as Transferwise, Wise is one of the best fintech platforms for sending international payments. Wise lets you set up multiple foreign currency accounts, gives you bank-level security, and enables batch payments of up to 1,000 transactions in one click.

Use a digital payment method

Most contractors will be understanding as long as they are pay international contractors kept informed. Find out which currency they expect, how often they want to be paid, and if any documentation is required. But once you move forward, it is important to understand the rules in both your country and the contractor’s. The platform allows you to create compliant standardized contracts that can be signed and executed through DocuSign.

• Our contractor management platform allows for seamless invoicing of independent contractors in one place, in your choice of 60+ currencies.
• Paper checks and international money orders are another way to pay international contractors.
• Beyond payments, Horizons serves as a comprehensive workforce management tool, assisting with talent sourcing, payroll, and contractor management in 180+ countries.
• Explore the features driving remote success for thousands of companies.
• When paying international contractors, you’ll quickly discover that currency matters more than you might expect.
• Intermediary bank fees, sometimes called “receiving bank fees,” can be levied multiple times in a single transfer, depending on how the money is routed.

Local Banking Barriers

Check whether contractors prefer to be paid in their local currency or in USD (or another base currency). This choice can have tax implications and impact their income stability due to fluctuating exchange rates. Ensure that your classification practices comply with local labor laws to avoid penalties and maintain good standing in the countries where your contractors are located. Proper classification also affects contractor expectations regarding work structure, payment, and benefits. The platform also enables instant transfers between Revolut accounts, significantly accelerating the payment process for contractors already using the service.

Financial Operations Platform

Paper checks and international money orders were once standard for cross-border payments. Just as https://www.bookstime.com/ important, make sure the schedule aligns with local norms in the contractor’s country. Susan is an experienced, certified HR and compliance professional who provides HR and compliance strategies to companies with global and US-based teams. Use tools like Deel Shield (which offers contractor misclassification protection), or get guidance from an employment attorney.

• Form 1099-NEC (non-employee compensation) reporting only applies to U.S. citizens working abroad or foreign contractors who performed services within the U.S. for 90 or more days.
• Deel has a team of local experts around the world who stay on top of local laws and regulations for you to ensure all workers are paid compliantly.
• The working relationship will be assessed under local IR35 rules, which determine their employment status for UK tax purposes.
• Physical boundaries do not limit their contributions; they integrate their expertise with teams and projects worldwide.
• Streamline your invoicing, expense tracking, and time management for increased productivity.
• Every aspect must be addressed carefully, from legal obligations to payment logistics and tax requirements.
• While a W-8BEN is issued to individuals, Form W-8BEN-E is issued to international contractors acting as an entity.