How to register as a freelance contractor

Enjoy the independence of freelancing while shedding the administrative load

Invoices, tax duties, contracts and even the simple task of receiving payment can feel overwhelming for an independent contractor. Fortunately, there are ways to remove the time sink and frustration of admin work. Use this guide as a step-by-step plan to accept payments quickly and confidently so you can refocus your energy where it counts most: on your clients.

How to choose the correct business registration

Drafting contract agreements for new clients

How to receive payment as an independent contractor

How to manage and track invoices

Handling taxation obligations for independent contractors

Independent contractors: key liability considerations

Accounting obligations for independent contractors

How do I ask the company I’m working with to convert me to an employee?

5 ways Remote simplifies life for contractors and their clients

Onboard with Remote and get set up in minutes

How to set up and get paid as a freelance contractor: your blueprint to remove tedious admin tasks

As an independent contractor, you are responsible for running nearly every aspect of your business. That includes finding and retaining clients, delivering projects, managing administrative tasks, and promoting your services. You are also expected to handle matters that may fall outside your expertise, like drafting everything about your business: getting and keeping clients, working on projects, handling admin, and marketing your business. You are also responsible for tasks that might lie outside your expertise, such as writing up contracts and dealing with taxes.

It can be daunting to write a contract if you are unsure which employment laws affect your business, particularly when a client operates from another country. You may also worry about receiving payments without significant processing fees eating into your earnings.

We are here to reassure you that you can handle all of these responsibilities. In fact, getting set up and paid as a freelance contractor can be straightforward, efficient, and quick — regardless of where your clients are located.

This guide provides practical assistance for independent contractors, especially those new to running a business. We will outline a process to manage your workload and explain how automation can simplify those steps.

We cover the four most intimidating areas for freelancers and show simple ways to manage each:

1. Contracts

2. Payments and fees

3. Invoicing

4. Tax

Ready to learn more about simplifying your freelance business? Let’s start at the very beginning: setting up your business.

How to choose the correct business registration

Before you begin working as an independent contractor, select the legal form your business will take. That choice determines your tax and legal responsibilities and varies depending on where you file taxes. Countries—and sometimes regions within them—have different rules for independent contractors.

Most jurisdictions offer several common options

• Individual entrepreneur. This is a straightforward option for solo contractors. In some countries, such as France there is a legal distinction between the person and the business; in other places there may be no separation.

• Partnership. A partnership relies on an agreement between parties and often does not distinguish the partners personally from the business entity.

• A limited liability company. This is a formal legal entity separate from the individual. Usually income and losses are recorded at the company level rather than personally.

Other structures may be available depending on the country where you operate. For example, Australia, for instance, offers a trust model where a trustee runs a business on behalf of beneficiaries.

Each structure has advantages and drawbacks, but many independent contractors opt for the individual entrepreneur model because it is relatively easy to establish and operate.

For country-specific labour law details, visit Remote’s Country Explorer — our international hiring guides contain useful information to help you set up your freelance business.

Read more on how to become an independent contractor

How to become an independent contractor in 6 simple steps

Although contracts are helpful, they can be complex because contractor rights and working conditions vary by country. If you use a random template from the web or draft your own without legal guidance, the agreement may not be enforceable in some jurisdictions and could even work against your interests.

Contractors can ensure their arrangements with local and international clients are lawful by using one of Remote’s compliant, tailored contract templates. These documents are adapted to country-specific legislation so contractors remain compliant regardless of the client’s location.

If you already have a contract you trust, you may continue to use it. When you join the Remote platform as a contractor, you can upload your own contracts instead of using ours.

Learn more about contracts here.

More on independent contractor agreements

Contractor Management

The dangers of contractor misclassification

In almost every country, independent contractors are classified differently than employees. Many protections and benefits that employees receive—such as health care, pensions and stock options—generally do not apply to contractors. Choosing to be an independent contractor gives you the freedom to select clients and control when, where and how you work, but you forgo those employee benefits.

Despite the legal distinction, some companies deliberately misclassify contractors to avoid obligations; other times it happens unintentionally. Whether deliberate or accidental, misclassification can result in penalties and fines for both you and your client. The client may incur heavy fines in their jurisdiction, and you could face consequences for not having paid the correct taxes in your own country.

Keep in mind that being correctly classified as a contractor is in your best interest.

First, a properly classified contractor retains the freedom to decide how they work. For example, in the United States, companies cannot dictate how a contractor performs their work or impose fixed hours. The contractor completes the agreed project in their own way and schedule. Proper classification also offers greater control over your earnings.

Penalties for misclassification vary by country. To avoid them, coordinate with your clients to ensure your status is correct. Discuss your responsibilities openly and review the working arrangement periodically. If your role becomes more integrated with a client’s operations, you can ask to be converted into an employee.

Learn more about the risks of misclassification in these guides

Contractor Management

Contractor Management

How to get paid as an independent contractor

As an independent contractor, managing invoices and collecting payments falls to you. That often means billing each client individually and accepting whichever payment method they prefer — a process that can be slow and inefficient.

Some of the most common ways to collect payments include:

Bank transfers

• Bank transfers, A transfer of funds between two bank accounts, While these transfers are quick, they typically come with hefty service fees.

• Direct deposits. A deposit directly into your bank account. Also quick, but can cost your client fees. It can also become complicated if you’re doing business with multiple clients or clients in different countries.

• Paper checks. Paper checks can be deposited via an app, but the method is becoming outdated due to long processing times. Physical checks can also be lost or stolen.

• Money orders. Money orders are a secure payment method that can be used internationally in many countries but can be inconvenient. They must be bought in person and, like checks, can be stolen, lost or delayed in the mail. Additionally, money orders are sometimes associated with fraud and may raise suspicion.

• Virtual wallets. Virtual wallets are increasingly popular and can be a fast way to receive funds, but some clients may not accept them and there are security considerations with digital wallets.

• Digital transfer services like PayPal and Wise. These services are fast and convenient and often support invoicing, but they may take a percentage or apply high currency exchange margins that can be significant.

Alternatively, you can use a trusted solution like Remote. Our platform offers a simple, secure and dependable way to receive payment quickly in your local currency — with no hidden fees. Add your bank account as a withdrawal method in your Remote dashboard, and client payments are deposited straight into your account.

You do not need to keep checking the dashboard to confirm payment: Remote emails you as soon as an invoice is paid. Learn more about how our platform can help with payments.

Your go-to guide for freelance invoicing plus a free template

Contractor Management

How to get paid by international clients

International payments are more complex than domestic ones. Currency conversion, arranging wire transfers and costly processing fees can make accepting international payments stressful.

Remote streamlines that process. Our contractor management service covers more than 200+ countries and territories, allowing you to be paid in the currency you prefer, regardless of the currency you invoice in. Here’s how it works:

1. Invoice

You invoice your client in whatever currency suits the client and upload the invoice to Remote’s contractor management platform.

2. Payment is made

The client settles their invoices in their own currency.

3. Payment is received

Once Remote receives payment, we convert it into your preferred currency before issuing the payout to you.

Contractors can choose between two payout methods. Add your bank account details directly to Remote, where payouts are powered by Wise, or use a Stripe Connect account. You can update your preferred currency and payment information at any time.

What about fees?

We work with several partners to make sure our pricing is both fast and as affordable as possible. We do charge your clients a $29 USD fee for payment processing, but as a contractor, the only fee you pay is a mid-market currency conversion fee. If you’re being paid in your preferred currency already, there’s no fee at all.
You can learn more about our fees in this support center article.

How to manage and monitor invoices

Invoicing as an independent contractor can be tedious. You may end up relying on a mix of tools to manually create, send and follow up on invoices, which is inefficient. Manual systems are slow, repetitive and prone to mistakes.

By automating your invoicing, you can simplify billing and return to revenue-generating work. Remote can assist with that.

With Remote, you no longer need spreadsheets, email chains or other manual systems to invoice. Our platform enables you to create invoices, submit them for approval and receive payment in your local currency without switching tools. Upload your invoices to Remote, we route them to your clients, and you’ll receive status updates as each invoice progresses through approval.

Setting up billing

As a contractor, submit invoices to clients through your Remote dashboard. You can do this in one of two ways:

1. Upload your own invoice

Create an invoice that shows the invoice date and amount, then submit it as a PDF.

2. Create an invoice on Remote

Use our templates to build an invoice within the platform. You can also set up recurring invoices that are sent automatically to your client.

To learn more, check out this article in our Help Center.

Managing independent contractor taxation obligations

As an independent contractor, you are responsible for paying your own taxes. Tax systems differ by country, so how taxes are handled varies across jurisdictions.

For example, in the US you pay taxes directly to the government, whereas in other countries clients might deduct tax at source. For details on contractor tax obligations in your location, visit Remote’s Country Explorer page.

That is one reason proper classification matters: it affects how you pay taxes.

Liability considerations for independent contractors

As an employee, a company typically handles liability matters. As a sole proprietor, however, you personally bear responsibility for debts such as finance or tax obligations, which could put personal assets at risk. To reduce exposure, many independent contractors obtain liability insurance to mitigate that risk.

It is also wise to protect yourself legally when negotiating and signing client agreements. Remote’s legal team reviews our contract templates so you remain compliant in the country where you work.

Accounting requirements for independent contractors

Independent contractors do not need to publish annual financial statements, but they must keep orderly records of accounts, including client invoices and business purchases, to monitor income and prepare taxes.

You can maintain these records yourself using accounting or bookkeeping software, or hire a professional bookkeeper or accountant.

Consider opening a separate bank account for business expenses; some countries require a business account once turnover exceeds a certain threshold.

How do I ask the company I’m working with to convert me to an employee?

Start a conversation with your client and outline the risks and advantages of moving to an employer–employee relationship. Emphasise how the change would benefit both parties — not only yourself. There are several reasons a company might wish to convert you to an employee. For example, becoming an employee would allow the client to set your hours and direct how tasks are completed.

Listen to the client’s concerns. International clients may feel they cannot hire you without a legal entity in the country where you work. In that case, propose using an Employer of Record (EOR).

An EOR acts as the local employer on behalf of a company, helping to employ workers in other countries. Typically, an EOR handles HR administrative duties, including local payroll, benefits administration and tax compliance.

Remote, for instance, is an EOR, and can simplify the transition by keeping your client or employer compliant with local laws.

To learn more about advocating for yourself as a remote worker, download our Remote Toolkit.

5 ways Remote makes life easier for contractors and their clients

There is a lot to consider when establishing yourself as an independent contractor. Remote can help with many of these challenges so you can focus on growing your business and delivering for clients. Here’s how:

Learn more about how Remote can help you as an independent contractor here.

Onboard with Remote and get set up in minutes

Working with freedom and flexibility is empowering, but administrative duties can distract you from what you prefer to do: serving clients, getting paid quickly and growing your business.

Using a reliable platform like Remote helps you manage these obligations efficiently, so you can concentrate on your business goals.

Our platform streamlines onboarding for independent contractors — guiding you through setup and identity verification for security. You will also be prompted to upload any necessary tax documents for secure storage.

Learn more about how Remote can save you — and your clients— time and resources.

Get started with Remote today.