Keeping Your Global Payroll Compliant: A Guide
You’ve done your research and the proper due diligence to expand your business abroad. All that’s left is to set up the global payroll service to best suit your expansion. While this may sound like a simple endeavour, it can be a quite complex process – as without a compliant international payroll, you cannot pay your employees. Here, we explore the process of implementing the best practices for international payroll services and how to avoid complications to keep your payroll compliant.
1. Ensure That You’re Adhering to Local Laws and Regulations
When you’ve gathered all of the information necessary on your new expansion of business through market research, use this information to understand what local laws and regulations might affect your business and its payroll. For example, companies expanding to the EU must adhere to General Data Protection Regulations (GDPR) when it comes to handling their employee’s data.
Another example of a piece of information that is pertinent to the compliance of your international payroll, is the understanding of minimum wage, which is an ever-changing changing variable. Failure to pay employees minimum wage can result in fines which greatly exceed what you’ve spent paying them.
Once you have full insight into local laws and regulations, set up a legal structure and pursue the proper registration to get your business and global payroll services up and running.
2. Understand Tax Policies and Other Fees to be Paid
With each new overseas location comes a different set of filings plus taxes that need to be paid and different dates which they’re due.
In each of your business international locations, it is imperative to keep track of all of this information to ensure that your international payroll remains compliant. If not, you risk fines and penalties for not paying taxes on time and for filing late or incorrect returns. You also risk over paying your taxes and damaging your relationship with your international employees due to payroll errors.
3. Deciding How to Prepare Your Global Payroll
At this point in the process, you understand the necessary information needed to implement a compliant global payroll in your business expansion, and must decide if you want to prepare payroll in-house, partially, or fully outsource the process to an international payroll service provider.
Hosting your global payroll in-house is beneficial if you already have staff who can manage this – or if you are frequently dealing with last minute changes to your payroll. In terms of compliance, it is critical to ensure that you have the appropriately skilled resources necessary to run an efficient payroll in your chosen countries.
On the other hand, outsourcing global payroll is more common practice and a sensible decision for companies expanding internationally, as it reduces in-house costs and allows you to focus on the bigger picture. Outsourcing not only ends up being a more economical decision, but a more practical one – international payroll providers will understand the local regulations and ensure your payroll is run efficiently and compliantly.
Keeping global payroll compliant is important for any business. It may seem like a daunting task, but with the help of the specialists at Galvin International it doesn’t have to be. We can help you from the beginning of your expansion to the end, ensuring you have all the support needed to help make decisions including whether or not to outsource your global payroll and providing trusted partners for you to do so with.
Get in touch with us today and let us take care of keeping your global payroll compliant.
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