Supplementing your staff with international talent provides incredible opportunities for your business. If you’re facing a limited talent pool in your area — or if you need specialist skills — it might be time to begin looking overseas. As you begin looking, though, you must first answer one hard question: what is the difference between an international contractor versus an employee? And what are the pros and cons of each?

When building an international team, there is no universal approach. Every country has different labor laws, reporting requirements, tax obligations, and even different definitions of employment. It can be a lot to manage, especially if you want to engage talent in more than one country. 

Deciding when to work with an international contractor or when to hire an employee in another country is an important decision. There are several pros and cons to consider, especially around contract management and the local employment regulations for the country where your team members reside. Knowing how to stay compliant when hiring international contractors or employees is essential.

Read on for everything you need to know about hiring an international contractor versus hiring an international employee.

An international contractor is a person who is not a citizen of your own country and who resides in another country while performing work for your company. An international contractor is not your employee, but they have entered into an agreement to work with you in certain ways:

Po provide specific skills you need for your business on an ad hoc basis 

International contractors are responsible for the work you contract to them. They may have multiple customers in addition to your business. Contractors are technically self-employed and are responsible for running their own businesses — that is what makes them contractors as opposed to employees.

Difference between a local and international contractor

Different countries have different rules regarding who is or is not a contractor. In the U.S., for instance, the IRS has rules for determining who is an international contractor and who is a local contractor. These definitions are part of the U.S. tax code and are not open to interpretation. The definition is used to determine the tax obligation for both the contractor and the businesses contracting them for work.

Cheat sheet: Local vs international contractor in the U.S.

As a general rule, if the work is being performed in the U.S. or a U.S. territory, the person is considered a local contractor. If they are an American citizen or green card holder, they’re also considered a local contractor. There are a few exceptions, but most people will fit into the following definitions. 

For the U.S., an international contractor meets all these criteria:

Is a resident of a country outside of the U.S.

Performs the majority of their work for you outside of the U.S.

A local contractor only has to meet one of these criteria:

Is a U.S. citizen, regardless of where they live or work

Is a foreign person who lives in the U.S. or meets the green card test

Meets the substantial presence test, as defined by the IRS.

It’s important to note U.S. citizens and green card holders are taxed on worldwide income. There are no tax havens for U.S. citizens where they can earn tax-free income. There are, however, income tax treaties between the USA and foreign countries, which help Americans reduce or eliminate double-taxation issues.

If your company has a legal entity in another country, or what is called an owned entity, you can hire international employees and contractors in that country. When the government views a person as your employee, but you treat that person like a contractor, it’s considered a misclassification of employee status. Be aware there are penalties and legal consequences involved, even if the mistake is unintentional. 

Employee vs contractor depends on the situation

As you establish the foundations of your business, building a global team is an excellent way to gain competitive advantage. You can enlist the best skills while benefiting from different perspectives and worldviews. There’s also the possibility of finding the skills to tap into emerging trends that may not have reached your area yet. Whether the people offering those skills are employees or contractors depends on your situation. 

Here are some of the common scenarios you may encounter:

Hiring a superstar candidate from another country

As remote work becomes the norm, the candidate pool for employees grows even more wide open. Many people aspire to work for companies outside their own countries. It is possible for superstars from anywhere in the world to work for you, even if they do not want to leave their home countries. These people could easily become employees or international contractors, but you need to ensure they are classified properly according to the labor laws in their country of residence. 

Managing relocation for an existing employee

If you have an employee with a bad case of wanderlust, why not help them relocate? You can provide the lifestyle opportunity they crave without losing all the knowledge they’ve accumulated within your company. As an international employee, they can retain their seniority and benefits, which is a great way to reinforce your company culture in a new office location.

Engaging a consultant outside of your owned entity locations

If the best person for the job lives in a country where you don’t have an owned entity, you  can bring them on as an international contractor or find an employer of record to hire them as an employee. If you do not own your own local entity and want to hire an employee instead of a contractor, you must work with an employer of record to do so legally.

Working with freelancers is a quick way to hit productivity targets because they come with all the skills needed to get right to work. Hiring freelancers as international contractors requires your onboarding process to fill out the correct paperwork, contracts, and tax forms for the countries where your international contractors reside.

Converting a part-time worker to a full-time worker

Moving a worker from part-time to full-time will often trigger a reclassification if a person has previously been engaged as a contractor. Either way, you likely need to have new contracts drawn up when converting an existing employee from one status to another. Review Remote’s Country Explorer for detailed information about employment regulations and customers in more than 170 countries. 

Renegotiating or upgrading an existing relationship

Converting an international contractor to an employee helps build morale in your international workforce and allows you to offer career development opportunities. This is an event that can be initiated by you or by your international contractor. If you have had a good working experience, converting a contractor to an employee is a low-risk way to build your company team and cement stronger long-term relationships. If you discover that you have misclassified a worker’s status while renegotiating a contract, do not delay in correcting the situation. 

Deep dive: Expert guide and resources on how to hire an international contractor

What are the different types of international contractors?

There are several different types of international contractors:

Independent or freelance contractors work for you in another country, but they are not your employees. The engagement is governed by a localized contract directly with the contractor that defines the parameters of the relationship and the work being performed.

Subcontractors partner with an umbrella company acting as a talent supply chain between your business and the international contractor. The umbrella company manages compliance requirements including payroll, taxes, benefits, and withholdings. Your business is charged a recurring fee to manage each overseas contractor. This option is generally more expensive than hiring an independent international contractor.

Agency contractors are employed through an agency and move from one contract to another while maintaining stable employment. Agency contractors usually get paid when they’re between contracts, so the agency is incentivized for finding these contractors work. The agency helps maintain the quality of work, but they also put a sizable markup on every billable hour or fixed-price project. This is generally the most expensive way to hire international contractors. 

What are the pros and cons of using international contractors?

If you’re scaling and growing a company, hiring international contractors allows you to move quickly and with confidence because you have a good team behind you. There are a few drawbacks, though. 

You can supplement your team with highly skilled workers who are “work ready.”

Contractors provide good local knowledge if you’re trying to break into a new area.

Contractors usually have large professional networks who can be a good source of referrals for additional skilled workers.

Contractors are self-sufficient with limited need for onboarding or training.

Contractors supply their own office space and equipment.

A contractor model is cost effective for short-term engagements.

You don’t have to guarantee steady work, especially if you’re in startup mode.

A contractor’s attention may be divided across several customers.

You have little say in or control over how they do the job.

Misclassification errors can occur if contractor status changes, even if you don’t realize it’s happened.

Complying with local employment laws and taxation requirements can be a cumbersome exercise.

Contracts must be localized for each country.

If you need to convert a contractor to an employee, you must establish an owned entity in the country or find an employer of record to hire those employees on your behalf.

Your intellectual property and invention rights may not be as well protected as they would be with employees.

You may have too many vendors to manage, especially if you use contractors in multiple countries. 

You could lose talent if they expect future employment and you can’t offer it.

What are the pros and cons of hiring international employees?

If you are in the position to hire an international employee, it’s worth considering the pros and cons of doing so as an alternative to hiring contractors.

You can hire the best talent available regardless of where they are located.

The investment you make in training is retained in the company. 

Employees help build a strong company culture and have more loyalty than contractors.

You retain greater control over your intellectual property.

You can offer international assignments to your team.

Any risk of potential misclassification is eliminated.

Innovation is enhanced due to new perspectives and skills.

Building a globally consistent culture can be challenging when your team is distributed.

You must supply office equipment, office space, and employee amenities in multiple locations.

In some countries, you may be required to provide training and professional development beyond your usual policies.

You must source local HR, legal and tax expertise everywhere you hire.

Employment contracts must comply with local laws.

Is an international contractor or international employee better for your business?

Every company is different, so there’s no one-size-fits-all approach to international staffing models. Your decision to use an international contractor or hire an international employee depends on things like how much funding you have, your workloads, and the reasons for entering a market in the first place.

Employee model — Do you have a great candidate in another country who would be a strong addition to your business? Are you considering a full expansion into another country? To hire a few employees, you can use an employer of record. If you want to make a full expansion into new territory, you can begin by hiring employees through an employer of record, then transfer those employees to your own entity once you finish setting it up.

Contractor model — If you are not looking to fill full-time positions, consider starting out with international contractors instead of employees. This is a great option if you need help on a certain project or to handle overflow when your business is especially busy. Be cautious not to keep the same person as a contractor for too long without reviewing your agreement, however. In certain countries, a person retained as a contractor automatically converts to an employee after a certain period of time.

Hybrid model — It’s not unusual for businesses to have a combination of employees and contractors. You can hire international contractors and hire international employees in the same country or in multiple countries, especially if you are using an EOR. You may have some countries where everyone is an employee and other countries where everyone is a contractor.

How do I hire an international employee abroad? 

Hiring international employees can be straightforward if you have a legal entity in the country where the worker lives. If you do not have your own entity, or if your business isn’t ready to scale in that country, it makes sense to consider using an employer of record (EOR)  to help you hire people legally and efficiently. 

An EOR handles all the local legal requirements so you can employ full-time workers and be fully compliant with all local employment laws. An EOR also eliminates the need for you to source in-country lawyers, accountants, payroll providers, and HR professionals. The EOR basically acts as your local HR and legal department on the ground in another country. Your employees receive their pay and benefits through the EOR, but they work for your company the same as your domestic employees do.

Read more: What does an employer of record do?

How do I hire an international contractor abroad? 

If you do not have time to become an expert in international employment law, don’t worry — hiring international contractors is easy. You just need a good way to build your team and alleviate the complexity of navigating local employment regulations.

Remote’s contractor management solution lets you onboard, pay, and manage contractors anywhere in the world. Create locally compliant contracts, make payments in local currencies, and manage invoices all in one easy-to-use platform. Remote’s convenient service is designed to help growing businesses manage international contractors while laying the groundwork to scale in the future. 

There’s a lot to consider when paying international contractors. Different countries have different costs of living, which may affect your pay structure. In some countries, fringe benefits are just as important as pay when it comes to competitive hires. Despite what you may think, it is possible to offer benefits to independent contractors. You also need to consider local holiday schedules, vacation expectations, and other cultural influences on how to construct an attractive offer. 

Once you’ve come to an agreement on a pay package, the mechanics of getting money from your business to an international contractor can present a few more challenges. You may end up spending thousands on bank fees and exchange rates if you are not careful. Choose a payment method that does not cause your new contractor to incur transaction costs.

Read more: Remote’s expert guide on how to pay an international contractor. 

How do I ensure compliance when hiring abroad? 

What are the pros and cons of using international contractors over hiring an employee? Remote's guide to the pros and cons of each option can help.

International contractor vs. employee: Pros and cons

Independent contractors can be a great way to leverage top talent and scale up your operations quickly. In this guide from Remote, you will learn how to pay your independent contractors quickly, easily, and in full compliance with the appropriate labor laws.

Managing and paying a distributed team requires a global payroll strategy, as well as an understanding of taxes, laws, and regulations in all the places where your contractors are. Hiring independent contractors also means paying close attention to classification, compliance, and risk management.

Despite the obstacles, paying independent contractors can be quite easy. (In fact, with Remote, you can sign up for free and begin onboarding and paying contractors anywhere in the world in minutes!)

To get you started, we have put together this helpful guide on everything you need to know about how to pay independent contractors around the world. For more help, check out some of our other guides:

Expert guide to contractor misclassification

How to offer benefits to independent contractors

When to convert a contractor to an employee

No matter what your questions on how to pay independent contractors (or where those contractors may live), Remote is here to help. Let’s take a look at everything you need to know to pay your contractors fairly, on time, and in the appropriate currency.

An independent contractor is a non-employee worker who provides goods or services to your company. Contractors work for themselves, usually with their own equipment, in their own spaces, and on their own time. They are their own employer, so you have limited control over them. In fact, in most countries, independent contractors are defined by this lack of employer control.

Companies use contractors for a variety of reasons. Working with contractors allows you to access talent and services outside of your company. Most of the time, independent contractors already have the necessary skills to complete your project, which means you don’t have to spend precious time on training. Contractors immediately increase your bandwidth without the extended onboarding period required for employees, allowing you to scale up or down depending on the situation. Contractors can also be very cost effective, because they don’t require benefits packages, paid time off, or company-withheld taxes. However, to account for this difference, contractors usually cost more than employees on a strict per-hour basis.

It can be tempting to classify workers as contractors because of the apparent ease and financial savings. However, if you don’t manage contractors correctly, the penalties of misclassification more than offset those savings — and those penalties are not only limited to monetary fines.

Read our guide to the dangers of contractor misclassification for more information.

What are the challenges of managing independent contractors?

Managing independent contractors can be challenging. Working with independent outsiders involves a lot of moving parts, including invoicing systems, complex labor laws and regulations, taxes, and classification. In addition, paying international contractors is a bit more complex than paying workers in your own country. Let’s go over the basic challenges.

Because contractors work for themselves, they track and manage their own time and output. Then, they invoice you for payment based upon whatever agreement you have in place, be that an hourly or per-project basis. So, before you can do anything else, you need a system to process invoices and pay contractors.

Paying a contractor isn’t like paying a bill. Contractors depend on timely and correct payments the way employees depend on their salary, so it’s vital to make payments quickly and reliably. The challenge is managing different currencies and banking systems, as well as local regulations that may mandate payment in local currency. All of this can cause delays, affecting your relationship with your contractor. Be sure your contractor payment tool can handle all your contractor payment needs to avoid unpleasant surprises.

Every country has its own local labor laws and regulations. For example, in some places, you need to provide safe working environments if the contractors ever come to your office. In other areas, contractors must be registered with the government before they can accept contracts as independent workers.

If you’re managing global workers, you have more than one set of rules to follow — and those rules can change without notice. Monitor the laws in all areas where you use contractors. If your company does not have the resources to monitor changing laws in all the countries where you hire contractors, be sure you’re working with a partner who has the necessary international legal infrastructure.

Managing tax requirements and relevant tax forms 

As with local labor laws, every country has its own tax requirements and tax forms. For example, US companies are required to file Form 1099 for each of their contractors. Failure to do so can result in penalties. These requirements can change from year to year. Be sure you are properly collecting and filing the appropriate forms on behalf of each contractor.

More countries are cracking down on contractor misclassification, so it’s more important than ever to get classification right. Minimize your risk of contractor misclassification by:

Researching classification criteria for each country where you hire

Paying contractors appropriately for contract work

Periodically reviewing the nature of your relationship with each of your contractors

In some cases, the country’s government may have a system in place for contractors to use. Be sure to work within that system to avoid entering into illegal contracts.

What are the key stages of the contractor payroll process?

The process of paying international contractors starts with classification and ends when you are no longer engaged with a particular freelancer. Here’s how it all works.

You must ensure that each contractor relationship meets the contractor classification criteria for that country. This is vital. If you misclassify employees as contractors, you risk serious consequences. Learn more about hiring employees and contractors in different countries around the world on Remote’s Country Explorer. 

You should have a legal agreement with your contractor in place before work begins. The contract should establish the scope of work, pay rate, and pay cycle. Your contract should also outline protections for your intellectual property, including who owns the work the contractor produces on your behalf.

Contracts may require specific changes depending on the country where your contractor resides and the country where your company operates. A legal team with local expertise should review contracts periodically to ensure they are up to date with local laws.

A streamlined, country-specific onboarding process is a key component for paying independent contractors quickly. Although onboarding contractors is easier than onboarding employees, you still need to collect appropriate information, make sure the contracts are signed, and get your new team members working.

Tactics for managing contractor invoices and payroll are unique to each company. Whatever your strategy may be, it is vital that you correctly pay your contractors for the work they perform. Pay workers in local currency where required by law or when the contractor requests to provide a great experience. If your contractor requests a non-local currency, like US dollars, be sure you can legally pay your contractor in that currency before agreeing. Once you have the accuracy part down, try to speed up your contractor payment cycle. Fast payment of invoices builds trust and improves your reputation among freelancer circles.

The other question is how much to pay contractors. Costs are specific to region, role, and industry. In most cases, the contractor sets the rate, and you decide whether you want to pay that rate or negotiate. Contractors are responsible for their own taxes, insurance, and overhead, so their rates are determined accordingly, which usually means more on a per-house basis than an employee performing the same tasks.

Periodic classification reviews will help you minimize misclassification risks. Classification laws change over time, both locally and internationally. Regular reviews help ensure you are following any updated rules and regulations. In some countries, the length of a relationship is part of the criteria for classification, which is another great reason to schedule recurring reviews of independent contractor agreements.

The substance of your relationship with a worker may change over time, necessitating reclassification from contractor to employee. Depending on the situation, your needs or the needs of the contractor may change and require reclassification. Periodic review will show you when relationships have shifted or need to shift toward employment relationships. 

You have much more flexibility terminating contractors than employees. Terminating an independent contractor can be as simple as not renewing a contract or not requesting new projects. However, if you have improperly classified a worker as a contractor, such termination could violate statutes and open you up to fines, penalties, and litigation.

A contractor who has been terminated may alert the authorities if they are upset with your company, which could draw more attention to whether the worker was classified correctly. This is another reason proper classification and periodic reviews are vital. Working with a partner with local expertise can help minimize risk.

How do I manage payroll for independent contractors?

There are several options for managing payroll for independent contractors. These include managing independent contractor payments in house; using a payment-only tool; or using with a contractor management platform.

If you handle things yourself, you will need a way to collect and manage invoices. This means staying up to date with any local laws that may affect your contract workforce. You will have to establish banking arrangements that allow you to pay workers in a timely manner in the appropriate currencies. Keep in mind that some countries require you to pay in local currency or through government-approved banks. While contractors are typically responsible for their own taxes, in-house contractor management may require you to manage certain types of taxes or withholding.

Simple contractor payment tools include online options like PayPal as well as direct bank or wire transfers. If you are comfortable handling the invoicing process outside the payments process, this may be a good option. Be sure to keep your records organized and accessible in case you need to review them later on a regulator’s request.

A full contractor management platform allows you to manage invoices, set up recurring invoices, generate tax forms, and pay contractors for services rendered, all in one place. In addition, a contractor management platform can help you understand your legal responsibilities to contractors in different areas and may be able to assist you with classification questions.

To see how it works, sign up for free to use Remote’s contractor management platform. With Remote, you can manage contractor invoices, payments, and documentation all in one easy-to-use tool. If you decide to convert a contractor to an employee, Remote can help you with those conversions as well.

How do I know if a worker is a contractor or an employee?

The exact criteria for classification varies from county to country. Typically, if you are hiring international contractors, the laws of the country in which the contractor resides take precedence over the laws in your own country. That means you will need to be familiar with relevant regulations.

In general, the classification of employee or contractor depends on the level of control the company has over the worker with respect to factors such as working hours, working location, equipment, etc. The more the company has a say in where or how a worker completes their tasks, the blurrier the line between contractor and employee becomes.

For more information, see Remote’s guide to contractor misclassification.

When is it time to reclassify a contractor as an employee?

How do you know when it’s time to reclassify a worker from a contractor to an employee? A contractor should be converted to an employee when they meet the criteria for an employment relationship or when both parties agree to make the change.

Are you in compliance with local laws and regulations with the relationship today?

Do you want to offer benefits to this worker?

Do you want the contractor to work on more sensitive projects?

Have you worked with the contractor for an extended period?

Do you face competition for the worker’s time?

Is the contractor asking to join your company as an employee?

For more information, see Remote’s guide on how to convert a contractor to an employee.

What are the risks of misclassifying independent contractors as employees? 

The risks of independent contractor misclassification can be severe. They include financial consequences, such as fees and penalties; litigation; and damage to your company’ reputation.

Improper classification comes with fines and penalties both for breaking the law and for failure to pay employment taxes you would have owed had the contractor been classified correctly from the start. Fines depend on the country, length of misclassification, and company intention. For example, in the Netherlands, fines increase if you are found to have willfully misclassified workers.

Back pay, taxes, and benefits compensation

Even if you misclassified the employee by accident, you will be responsible for unpaid taxes as well as relevant back pay and compensation for benefits the employee was denied. 

If you began working with a contractor two years ago and are found to have misclassified them the whole time, you will owe the government taxes and payments into social programs like Social Security for the entire two years. If they were paid at a rate below minimum wage, you will also owe back pay. You may also have to pay the contractor the monetary equivalent of required benefits such as paid time off, sick leave, or retirement contributions.

Misclassified workers may be entitled to sue you for damages, putting you at risk for judgements and legal fees. If many employees are involved, this can be a very costly risk.

If you are found to have misclassified workers, your company may be audited to determine the extent of the issue. Audits are expensive and time consuming when unprompted, but they can be especially grueling if investigators believe they are looking for something specific. If you are found to have additional violations, you may receive additional penalties and consequences.

Word gets around. Misclassification results in workers being denied pay and benefits. You may get a bad reputation for treating workers poorly, which can include negative press. This could limit your opportunities to engage with partners and investors if association with your brand becomes problematic.

For more information, see Remote’s guide to penalties of contractor misclassification.

Tax and compliance practices for paying independent contractors

In general, companies are not responsible for withholding taxes on contractor payroll or for paying payroll or unemployment taxes. However, requirements vary from state to state or country to country. In addition, your country of headquarters may require you to report payments made to contractors overseas. For example, US-based countries have additional reporting requirements when working with international contractors.

A local expert can guide you through tax and compliance considerations unique to each country. Click here to get started hiring international contractors.

Tax forms needed for US contractors and employers

In the United States, the Internal Revenue Service requires companies who pay contractors more than $600 to collect and file specific forms.

Collect Form W-8 BEN from contractors outside the US.

Collect Form W-8 BEN-E from contractors who bill through their own entities.

File Form 1099 for each contractor earning more than $600.

If this seems complicated, don’t worry. A partner like Remote can simplify contractor management. Here are some resources to help you get started:

What is a 1096 form? A guide for US employers 

How to pay independent contractors: The complete guide

The freelancing market has been experiencing explosive growth, and that trend is not showing signs of stopping. Freelancing offers a wide range of benefits and opportunities, including the flexibility of working travel options. In many cases, if you want to freelance, you just need a device to work on and an internet connection. As long as you have the right work permits and you can stay on top of the taxation ramifications of the digital nomad lifestyle, there’s not much stopping you from seeing the world while you freelance.

Freelancing abroad is very different from more traditional jobs. Aspiring international freelancers should invest time in researching what’s required to manage this lifestyle effectively and maintain productivity. 

It’s also important for potential business partners to be aware of how to manage their agreement with an international independent contractor. The dangers of contractor misclassification can cause catastrophic problems for these business relationships if not managed effectively.

Benefits of freelancing and contracting internationally

The major benefits of freelancing include flexibility, independence, and opportunities for change and growth. Freelancers can choose when and how to work. That means more control over your lifestyle and more capacity to spend time with friends and family when it suits you.

When you freelance you can work from virtually anywhere as long as you have a few simple tools. You’ll likely need an internet connection and an appropriate electronic device. This means you have a lot of choice for the way you work and where you choose to do so. You can work while you travel, you can work from a co-working space, a cafe, a hotel, or on top of an airplane tray table.

Additionally, freelance work can afford you the opportunity to adjust your work schedule to your liking. This can allow you to make your work schedule more compatible with other obligations and your lifestyle. 

Flexibility is particularly important in an increasingly globalized culture and economy, which allows for a greater range of opportunities related to things like travel, professional relationships, and personal enrichment. The benefit of flexibility can even help freelancers weather significant changes in their lives, such as necessary relocation.

While you will have to abide by any contractual agreements you make, freelancing allows you to operate as your own boss. As such, you will create your own policies, build your own schedule, determine what products or services you will offer, and decide how much to charge. While you might have less certainty than full-time employees, you’ll be in control of your workload and your time. 

As mentioned, when you freelance, you make the calls. If there is anything you don’t like about different aspects of your day-to-day work, you can make adjustments. For example, if you don’t like how often you are working, what type of work you are doing, or what type of client you work with, any changes you want to make are in your hands.

You can also delve into different career paths and determine how you might like to expand your business if at all. Freelancers associated with a company may even be able to experiment with longer term contracts and receive compensation for remote work. This allows both parties to generate an understanding of how best to work together with the option to transition to a full-time employee agreement if desired.

You may need to obtain a visa or work permit to travel while you work, depending on many different factors specific to each situation. These factors may include things like your country of origin, the type of work you are doing, and your background. Different countries will have different requirements related to granting permission for foreigners to enter the country.

Make sure you investigate the specific credentials required for you to work legally in whichever jurisdiction you are traveling into before you start your trip. 

It is also important to note that freelancing and self-employment are sometimes defined separately from other types of work considered for visas. The following are a few visas commonly used by international freelancers.

Before we outline the details of student visa requirements, note that freelancers should only pursue this visa if education is demonstrably a primary priority and freelancing is secondary. If you have side hustle or part-time contracting work, you may still be legally qualified with a student visa, but you can run into trouble if your work is deemed to be your primary focus.

This type of endorsement allows foreign students to study at the educational institutions of another country. A student visa can be a great option for freelancers who are also going to school. Special considerations that apply to international freelancers include:

Many student visas only allow for part-time work.

Some student visas may not allow you to work at all.

Some student visas may not allow you to work for a certain period after arrival.

Some student visas may only allow you to do certain types of work, such as on-campus opportunities.

Due to the possible restrictions, it may be best to only pursue this type of visa if your education abroad is your priority above work.

Work visas allow foreigners to reside in a country without citizenship due to employment opportunities available in the country. This may be available for a limited or indefinite period and you must ensure you have the legal right to perform any sort of work in the country (even freelancing for yourself). 

The specific requirements for obtaining a work visa depend on the country, and freelancers may not be eligible. Special considerations that apply to international freelancers include:

It is often difficult to obtain a work visa without sponsorship or employment from a large, well-established company within the country.

It may be helpful to form your own company within the country (but this comes with it’s own costs, risks, and time investments) 

This option may be particularly tedious and present many legal obstacles

You also introduce a suite of new taxation obligations if you choose to start your own company in another country

Overall, obtaining a work visa is often not the most feasible for freelancers who are not already closely affiliated with a company within the host country.

We want to emphasize the point above. Obtaining a work visa is not a simple ask and receive process. If you don’t have the legal rights to work, you are risking serious fines and penalties. Make sure you have the right work visas and permits before you leave for a so-called working holiday.

Some countries offer freelance visas, which may be a helpful option if you do not qualify for other types of permits or visas. These visas typically offer a limited window for freelancing within the country. Special considerations that apply to international freelancers include:

Freelance visas also may be called self-employment or entrepreneur visas.

As a relatively new development, relatively few countries offer this type of visa.

You may need to provide proof of minimum income. 

List of countries across regions that are currently offering a digital nomad visa: 

An increase in the popularity and feasibility of freelancing has opened up a new world of possibilities for travel abroad. With the right tools and information, a freelancer can move to or visit a wide range of destinations while still working.

Contractors

International contractor vs. employee: Pros and cons

How to pay independent contractors: The complete guide

A guide to freelancing and working abroad

Guide to freelancing jobs for veterans

New: Automated contractor payments in Remote

Written by • James Doman-Pipe

How to pay international contractors: Expert guide

Hiring independent contractors abroad: your expert guide

How to offer benefits for 1099 and international independent contractors

Working with remote contractors: Expert Guide

Fast, free, flexible contractor management with Remote

Employee and independent contractor misclassification: Expert guide

How to hire independent contractors: expert guide and resources

Remote Contractor Management: Tax compliance for US companies just got easier

What is a W-8 BEN form? A guide for US employers

What is a 1096 form? A guide for US employers

What is a 1099 form? A guide for companies with US contractors

The consequences of misclassifying employees as contractors

When should you convert a contractor to an employee?