Loading...

Follow The Payroll Edge on Feedspot

Continue with Google
Continue with Facebook
or

Valid

Talk to almost anyone who employs a worker in the US, and you’ll likely hear about the myriad rules that govern how you pay your team members. Conducting payroll in the US can be a bit intimidating for that reason.

It’s imperative for international companies to familiarize themselves with the laws, especially if they want to reduce risks and avoid penalties. Review some of the major federal laws you’ll need to be familiar with if you’re planning to pay US workers from abroad.

1. The Fair Labor Standards Act

The Fair Labor Standards Act, or FLSA, was introduced in the 1930s. It’s been updated periodically since then. It’s designed to cover full-time and part-time workers in both the private sector and at all levels of government.

The FLSA sets a federal minimum wage and also governs overtime. Currently, overtime wages are set at one-and-a-half times an employee’s regular hourly wage. The FLSA also governs the number of hours minors can work.

It’s important to note that the FLSA doesn’t cover all workers in the US. It offers individual coverage and enterprise coverage. Workers in certain industries may be exempt from some of the regulations, such as overtime pay.

It’s also important to note that state law can override the FLSA. Many states, for example, have higher minimum wages than the federal rate. In these cases, employers would need to comply with state law.

2. The Federal Unemployment Tax Act

If you are a private, for-profit enterprise operating in the US and employing American workers, you may need to pay unemployment taxes, as per the Federal Unemployment Tax Act. Also known as FUTA, this Act coordinates with state unemployment systems to provide unemployment compensation for people who lose their jobs.

Employers alone are responsible for FUTA payments. Employees don’t pay a portion of these funds through payroll deductions. Requirements vary from state to state, as each state administers its own unemployment program.

3. The Federal Insurance Contributions Act

If you’ve heard someone talk about FICA payroll deductions, you’ve encountered the Federal Insurance Contributions Act. This is the legislation that provides for programs like Medicaid and Social Security.

FICA requires employers to make deductions from their employees’ paychecks. These withholdings are then used to pay into social programs. Employers are asked to provide a match for what they withhold from their employees.

You’re expected to withhold 1.45 percent of wages for Medicare and up to 7.65 percent for Social Security. If your employees earn over $200,000, there’s another surtax as well.

4. Employee Retirement Income Security Act

You may not be subject to the Employee Retirement Income Security Act, but it’s a good law to know if you have US employees.

ERISA governs pension plans offered by companies in the US. While it doesn’t require an employer to offer a retirement plan, it does set up standards for pension plans. This includes how to report on plans as well as disclosure and fiduciary requirements.

5. The Family Medical and Family Leave Act

The Family Medical and Family Leave Act may not seem like it will have much of an impact on your US payroll operations at first. It provides only unpaid leave for your employees, which means you don’t need to worry about paying them if they do take leave.

Nonetheless, it’s a good idea to pay attention to the provisions in this law. It requires you to provide workers with up to 12 weeks of leave following the birth or adoption of a child, or for serious illness of the employee, their spouse, a child, or a parent.

This leave is job-protected, so you’ll need to know how to fill the position while the employee is away.

This list provides a good starting point for international employers. There are many other US laws that affect how you’ll handle payroll for your US workers.

Read Full Article
  • Show original
  • .
  • Share
  • .
  • Favorite
  • .
  • Email
  • .
  • Add Tags 

When your business decided to expand into Canada, you knew you had your work cut out for you. You needed to conduct rigorous market research and determine the best business structure for tax efficiency. You needed to think about your workforce and your logistics.

In many cases, you’ll want to partner with other firms to help your expansion efforts. You may decide to work with a lawyer to ensure you're making the right legal decisions for the business. Partnering with a professional employer organization (PEO) is also a great idea. 

How should you go about choosing your partners? The process should begin before you put the wheels in motion. Here are some tips to get started.

1. Find the Right Legal Advice to Expand into Canada

Before you do anything else, you should partner with a legal partner to consider the legal ins and outs of an expansion to Canada. This might be a lawyer or another legal professional.

This partner can help you assess the current legal climate and make the right decisions for setting up your business. A tax lawyer might be able to inform you about the best way to create tax efficiency. A business lawyer and an employment lawyer can share insights about their fields of expertise.

These partners can help you craft better policies and even structure your business correctly. Without the right legal advice, your expansion may not get off the ground. You could find yourself tied up in red tape.

How do you choose the right legal counsel? A general rule of thumb favours expertise and specialization. Find someone who deals with international businesses entering the Canadian market on a regular basis.

They’re much more likely to have the expertise to make the process quick and easy, even if they do charge a higher per hour rate. With their insights, you’ll be up and running sooner.

2. Choosing a Banking Partner

When you expand into Canada, you’ll need funds to fuel your operations. That means you’ll require the right banking partner to support the financial side of the expansion.

You’ll want to employ the opposite strategy here. Instead of seeking a specialized partner, choose someone with a broad range of expertise.

There are many players in the banking industry, but only some of them will be the right fit. You want a banking partner who can grow with you. If the partner you choose is too niche, they may not be able to support your growth. That could tie you up as you try to unravel the partnership and engage another entity.

Be sure to examine which banking partners best reflect your growth strategy. If their capabilities and values line up, you’ll find a more flexible, supportive partnership ahead.

3. Get On-the-Ground Help with Property

If you need to acquire land or real estate, you should seek out an environmental expert. This specialist will help you understand local rules. They’ll also reduce your risks.

Going in alone could mean you purchase a building that isn’t up to code or land that isn’t zoned for your use. You might also be responsible for maintaining or remediating a property to environmental standards.

The right help here is invaluable.

4. Partner with the Right PEO

A professional employer organization can help you navigate the details of having a workforce in Canada. Experts at a PEO can assist with payroll, HR, and compliance. They can offer other services too, such as health spending accounts for employees.

The right PEO typically has expertise in helping international businesses as they expand into Canada. They also have a network of other professionals and knowledge they can draw on to make expanding easier than ever. And they'll already have the infrastructure you need to expand. 

Do your research before you begin expanding, and begin building relationships with your Canadian partners as soon as possible. With the right network, it’s easier than ever to expand into Canada.

Read Full Article
  • Show original
  • .
  • Share
  • .
  • Favorite
  • .
  • Email
  • .
  • Add Tags 

As a US business owner, you’re eager to expand to Canada. Like many other American business leaders, you believe the Great White North is the best market for expansion as you continue to grow. After all, both countries have similarities in culture and a strong history of trade.

That said, you still have to carefully consider every aspect of your Canadian operations. That includes taxation of the business.

How do US companies pay taxes in Canada? The answer depends on different variables.

Determining Residency

Before you know how you’ll pay Canadian taxes, you have to determine residency. Non-resident corporations are treated differently than Canadian corporations.

Generally speaking, if the company was incorporated in Canada and continues to be incorporated in Canada, it is resident. A resident corporation can be deemed non-resident, provided it's being taxed comprehensively in a tax treaty country.

A non-resident company is incorporated outside of Canada. This includes parent companies that operate Canadian branch offices. Subsidiaries are separate legal entities, so they’d be more likely to be incorporated in Canada and considered resident.

The General Rule for Permanent Establishments

If you create a permanent establishment in Canada, you’ll only pay Canadian tax on the income you generate in Canada. This follows the principle of eliminating double taxation for foreign entities.

A permanent establishment includes a branch office, a workshop, or a factory. A permanent establishment can also include employees or agents who may conclude contracts in your name.

Generally speaking, the tax rate is around 25 percent. There are ways to reduce how much tax you pay, such as through tax treaties.

Tax for Subsidiaries and Separate Legal Entities

If you create a separate legal entity for your Canadian expansion, your tax situation will change. How and what you pay depends on the business structure you adopt.

Subsidiaries are considered Canadian operations, and they’re taxed accordingly. If you pay non-residents, including investors, you’ll need to subject those payments to tax withholding.

If the subsidiary does business in other countries, then you can apply for tax relief through treaties in those countries.

Filing for Non-Resident Corporations

If your business is considered a non-resident corporation with a permanent establishment, you’ll need to file and pay taxes in Canada.

You’ll need to file a T2 corporation income tax return, along with Schedule 97 on additional information for non-resident corporations. You’ll also have to submit Schedule 20, Part XIV, Additional Taxes on Non-Resident Corporations.

If you have Canadian employees, you’ll need to register for a payroll deductions account. You must also withhold a percentage of payment for services you render in Canada, as well as withhold on passive income you receive.

Finally, you’ll need to file dispositions of taxable Canadian property if you happen to sell taxable property in Canada.

Payroll withholding will be remitted to your payroll account, and the GST/HST collected will be paid to your business’s GST/HST account. The Canada Revenue Agency (CRA) will collect payments for tax, GST/HST, and payroll withholdings through its different branches.

Filing for Resident Corporations

If you operate a subsidiary or are otherwise determined to be a resident corporation in Canada, you’ll pay tax the same way other Canadian corporations pay it. This means filing a T2, along with other relevant forms and schedules.

Like non-resident corporations, you may need to collect and remit GST/HST. If you have employees, you’ll need a payroll account so you can remit your withholdings to the CRA.

Get Help with Payroll

The best step to take is to consult with the professionals, such as a tax lawyer or a financial professional.

Another option you have to make paying Canadian taxes easier is to partner with a professional employer organization (PEO). We can help you look after payroll, which can make your taxes less confusing at the end of the year.

Read Full Article
  • Show original
  • .
  • Share
  • .
  • Favorite
  • .
  • Email
  • .
  • Add Tags 

Even if you’ve expanded into another country before, you might feel overwhelmed by the American market.

There are many aspects to consider when you move into the US. As you’re aware, laws are very different, which can cause a tangle of red tape. You need to think about tax efficiencies and corporate structure. Your marketing strategy may need to be tweaked. You might even need to revisit your product offers and packaging.

You also must consider how to staff your business. Is hiring US workers the right move? Maybe you can hire independent contractors to fulfill your needs. Perhaps sending existing employees to the US is the right way forward.

Many successful global companies choose employees over any other work arrangement. Here are a few great reasons you should employ US workers.

1. Global Companies Get Insights from US Workers

US workers can offer you insights into the market and culture. You could hire remote workers from your home country, but if you’re serving the American market, will they connect to Americans in the same way?

Employees from the same cultural milieu can smooth relations with your customers. Your customers will also be able to relate to your workers more easily.

US workers can also provide key insights into the market. They have insider knowledge others in your company may lack.

2. They Provide Geographic Insurance

If you don’t have a physical location in the US, you may see no reason to hire employees on US soil. Operations can run from almost anywhere thanks to today’s technology, and your staff can telecommute.

Much like computer servers should be in geographically diverse areas, global companies should think about having a geographically diverse workforce. This provides insurance for your customers. For example, if complications prevent people in India or the UK from getting to work, your US employees will be on standby.

3. It Creates a Community Presence

Global companies often face challenges being accepted into their new markets. Consumers may see you as an outsider and decide not to buy from you.

One way to approach this attitude is to establish that you care about the communities you operate in. What better way to show you care about a community than by hiring locals.

This helps potential customers put real faces to names. By employing their neighbours, friends, and relatives, you offer local opportunities in the community. In turn, community members are more likely to feel sympathetic and connected to your brand.

Your employees could become your greatest advocates. They may talk up your products or services, as well as recommend you as an employer. In short, US workers can be the best brand ambassadors.

4. It’s Easier Than You Think

You may be reluctant to employ US workers due to legal concerns. You might be worried about tax implications or issues around employment law. How can you let someone go? What are the rules about overtime pay, holidays, or vacation pay? What are the leaves like in the US? What about benefits?

You might think these concerns make hiring US workers too much of a hassle, but it’s not as difficult as it seems. Working with a PEO can help you employ US workers without worrying about the ins and outs of payroll or the tax implications of benefits. The PEO can take on the liability and responsibility for your US workers.

5. It Builds Your Talent Pool

If you’re hoping to continue expanding, then building your talent pool is a good idea.

Employing US workers can help you do just that. When it comes time to expand again, you’ll know you have a strong group of talented individuals to draw on.

Many global companies hire US workers for some of these reasons. It could be a smart move for your business too. If you think it might be a good decision, talk to the experts and discover how the right US talent could help you ensure business expansion success.

Read Full Article
  • Show original
  • .
  • Share
  • .
  • Favorite
  • .
  • Email
  • .
  • Add Tags 

Hiring and employment often present concerns for global employers. How do you let someone go? How can you find the right people for the job? What are your tax responsibilities as an employer, and how do you make sure you’re not misclassifying your workers?

There are many nuances in this area, including documentation and employee files. You might be wondering what you need to keep in your files. Employing workers creates plenty of paperwork, but do you need to keep everything?

If you keep these five records, you should be well on your way to satisfying most requirements.

1. Global Companies Must Keep Files Relating to Job Performance

You’ll want to keep documents related to the employee’s job performance in their file. This includes records of evaluations and commendations.

These documents are important, particularly if an employee or ex-employee decides to file proceedings against you. Evaluations can show a record of the employee’s performance, which can help establish a pattern of behaviour in a courtroom situation.

2. Tax Documents Are Also Important

Global companies may feel overwhelmed by the number of tax forms they need to fill out or have their US employees complete. Not only are these important to complete, but it’s important for you to keep them on record.

At minimum, you’ll want to keep a copy of the employee’s Form W4 on file. This document allows you to collect and withhold taxes on the employee’s behalf. Employees should be permitted to periodically review and amend the form, which can be difficult if you don’t have it on file.

3. Records Pertaining to Discipline and Complaints

It’s also important for global companies to keep formal documentation of poor employee behaviour, disciplinary actions, and complaints from co-workers or customers. All these files can be presented as evidence in court.

They may also assist you in determining whether to keep on an employee or let them go. If corrective measures have been taken, but the employee’s behaviour doesn’t improve, it might be time to let them go.

4. Information about Compensation

You’ll also want to file records around notices of raises. You should supply employees with written statements of their raises, but you will want a copy in your files as well. This can serve as evidence if the employee lodges a complaint.

Benefits are also a form of compensation, and you’ll want to those records as well.

Be sure to explain to employees what their compensation consists of, and have them sign a form indicating they’ve read and understood the information.

5. Documents about Hiring and Departure Should Be Kept

Your employee file should open with a description of the job, as well as the employee’s resume and application. You should also include your formal offer of employment.

You’ll need to retain records for some time after an employee departs, so be sure to add documents to their file. Other documentation, such as exit interviews and records that clearly state the reasons an employee parted ways with the company, are important to keep on file. As with paperwork mentioned earlier, these items can serve as evidence if a complaint arises.

With these basics in hand, global companies can build better personnel files for their US employees.

Read Full Article
  • Show original
  • .
  • Share
  • .
  • Favorite
  • .
  • Email
  • .
  • Add Tags 

You know you need talented workers to staff your new US expansion. The question for many international business owners is whether they should hire employees or work with independent contractors.

There are pros and cons to both options. You’ll need to carefully weigh your options in order to make the right decision for your business. Keep these key factors in mind when you approach this vital assessment.

The Costs of Hiring

The first factor almost any hiring manager or business owner looks at is the cost. You likely weigh the costs of hiring and outsourcing at headquarters as well.

In some ways, hiring an independent contractor looks less expensive on paper. You don’t need to pay taxes for them, and you don’t need to pay them benefits. You don’t need to pay them for vacation days or holidays. You also won’t be responsible for supplying material or a workspace.

The contractor handles all of those costs. If you crunch the numbers, though, the picture becomes a little bit muddier.

Contractors may charge higher per hour rates in order to offset their higher operational costs. They may need to carry their own insurance or pay for equipment, and they’ll often pass those costs along to you.

They might also have control over what materials they purchase, and they might not go with the lowest cost item.

Often, hiring an employee is more affordable.

Quality Control

Another risk of hiring independent contractors is the issue of quality. Some contractors do excellent work and are efficient.

However, you could receive subpar work. The contractor may still charge big bucks for a less-than-quality job. They could also try to cut corners by using less expensive materials.

As an employer, you have more say over the equipment, materials, process, and end result from employees. When you work with contractors, you could be at their mercy.

Control of Schedules and Priorities

When you work with an employee, you can ensure your deadlines are met and your priorities are worked on as you request. You can adjust employees’ schedules to make sure jobs are finished on time or you have enough staff on the floor.

When you work with a contractor, you give up most of this control. Contractors usually have more than one client, and they might not prioritize your project.

That could translate into short-staffing on the floor or missed deadlines for your business.

Keeping Consistency in the Business

As you expand into the US market, you’re hoping to build a brand that Americans identify with. If you work with contractors, this can be harder to do.

One of these issues is that independent contractors might not deliver the consistency you need. They also aren’t as invested in your business’s success, so they may not see delivering great customer service or using the best equipment as a top priority.

By hiring and training your own employees, you can ensure a higher level of consistency. Employees are more likely to be invested in your business, and they may stay with your business longer. This allows you to provide continuity to your customers.

Make Employing People Easier

One reason international employers hesitate to employ true employees is because of concerns around employment law and payroll. They don’t understand the ins and outs of the law, and they might be worried they’ll face fines and penalties. By working with a PEO, you can simplify this situation. The PEO takes over all these tasks and the responsibility and liability of employing workers.

On the other hand, international employers hiring independent contractors often misclassify them, and this misclassification can lead to hefty fines and penalties.

Before you bring on an independent contractor, talk to a PEO. Hiring an employee could be the right choice.

Read Full Article
  • Show original
  • .
  • Share
  • .
  • Favorite
  • .
  • Email
  • .
  • Add Tags 

Hiring employees abroad can be a challenge for international companies. You need to hire top talent, but you may not have as much insight into the international job market. Cultural differences can make it more difficult to evaluate education, experience, and fit.

Once you’ve hired a new employee, you also need to know which steps to take next. Take a look at this guide. It will help you get your new hires settled in.

1. Adjust Your Onboarding Process for Hiring Employees Abroad

Onboarding technically begins the moment someone contacts you about a job opportunity. How quickly you respond to and how you communicate with them during the hiring process forms the basis of their experience with your business.

Of course, it’s not too late to begin onboarding once you make the job offer. Be sure to adjust your onboarding process to reflect cultural differences in the international market. Everything from how you communicate to who your new employee reports to may need to be tweaked.

You may also need to change the process to accommodate remote workers. A good rule is to introduce the new staff member to other key personnel. If they’re working remotely, try to get everyone together on a video call to say hello and welcome the new hire.

2. Get Them into the Payroll System

You should ensure your new hire is quickly added to the payroll system. There’s nothing more frustrating for a new employee than not getting paid on time because their account wasn’t finalized.

You should ask the employee to forward their details as soon as possible. Be sure those are sent to your payroll team or your professional employer organization, so they can set up and verify the account before the next payday.

Be sure to communicate when the employee can expect to be paid, as well as how you’ll handle any partial pay periods while the account is being created.

3. File the Right Paperwork

One of the challenges with hiring employees abroad is knowing what forms you’ll need to fill out after you’ve hired them. It can be challenging to get this paperwork completed in the designated timeframe. For example, you’ll only have so many days to file Form W-2 with the IRS when you hire an American employee.

Familiarize yourself with the paperwork pertaining to new hires before you bring someone on board. This way, you can hand them the paperwork to fill out before their first day. You won’t have to scramble at the last minute to make sure you have the right forms on file.

If you’re not sure, ask a PEO for help.

4. Set up Benefits

If you offer employee benefits, you’ll need to set them up when you’re hiring employees abroad. You may need to tweak the benefits package you offer in each international market you operate in. For example, health insurance is a bit different in the United States and Canada, since the two countries have very different healthcare systems. Often, offering an HSA is the easiest way to offer benefits to employees while controlling costs.

You’ll also need to file paperwork to get your employee enrolled in your employer-sponsored plan. It’s a good idea to go through the benefits package with new employees, explaining the coverage they have and how claims work.

Again, a PEO can help you find the right benefits package and get it set up for your employees.

5. Establish Expectations

Finally, when you hire employees abroad, be sure to establish clear expectations with them. How often should they communicate with you, and who should they report to on a daily basis?

Streamlining your processes and upgrading your onboarding procedures now will help you create a productive and creative relationship with each employee you hire.

Read Full Article
  • Show original
  • .
  • Share
  • .
  • Favorite
  • .
  • Email
  • .
  • Add Tags 

Like most business owners, you see growth as a measure of success. Expanding into international markets is certainly an indication of growth.

When you begin moving into other markets, though, you’ll need to take steps to secure your success. This is very true when you plan to expand into Canada. There are right ways and wrong ways to go about managing expansion into the Great White North.

Being aware of some of the wrong ways can help you avoid the missteps others have made before you. Learn about these mistakes as you plan your expansion, and you’ll be better prepared.

Don’t Plan to Expand into Canada Rapidly

Perhaps the best example of this misstep comes from US retailer Target. In 2011, Target bought up a number of locations in Canada and opened 124 stores in the span of less than a year in 2013.

The chain ultimately opened 133 stores before closing up shop in 2015. While there were numerous mistakes made in the Target saga, one of the key factors was rapid expansion. If Target had opened a few stores first, it could have focused on working out issues like supply chain management on a smaller scale.

Many companies have used the slow expansion model to conquer the Canadian landscape, and it generally works much better. If your brand isn’t as well-recognized as Target, take heed. Even popular brands can fail if they take on too much too soon.

Study the Culture

There are many cases of businesses experiencing culture shock when they expand to an international market. You merely need to look at the example of Mattel marketing Barbie in China. Chinese culture emphasizes educational toys and skill-building, so Barbie didn’t fare well.

In some cases, the differences in culture are much more subtle. This is certainly the case in Canada. Canadians share many cultural similarities with their American cousins, but that doesn’t mean their culture is the same.

Take some time to study Canadian culture before you expand into Canada. Whether you’re looking to connect with your employees or market to consumers, understanding cultural nuances will go a long way to ensuring your success.

You Ignored Market Trends

British supermarket Tesco tried to expand into the US in 2007, in what was a case of poor timing. Tesco’s messaging about fresh food appealed to US consumers, but the economy was on the brink of the worst recession since the 1930s.

It’s not just the economic indicators you’ll want to pay attention to when you decide to expand. You’ll also want to take a look at the competition. If your market is oversaturated, you’ll have an uphill battle to convince clients to switch to your business. If there’s no competition, are you looking at an underserved market or a non-existent one?

Doing your market research is imperative when you want to expand into Canada or any other market. Don’t forget to look at historical trends as well. If the market is shrinking, you want to know before you head across the border.

You Got Caught up in Red Tape

You hired a Canadian employee, but you forgot to file the paperwork. When it came time to let someone go, you fired them on the spot and didn’t pay termination pay. You aren’t sure about the rules regarding tax withholdings, overtime pay, or vacation time.

Legislation can protect you, your business, and your employees. It can also lead to noncompliance as you expand into Canada. Make sure you’re aware of the employment regulations and how they affect your business.

You can avoid all these mistakes and more when you work with an experienced PEO. If you need a helping hand as you expand into Canada, get in touch with an expert team today.

Read Full Article
  • Show original
  • .
  • Share
  • .
  • Favorite
  • .
  • Email
  • .
  • Add Tags 

If you’ve just expanded your business to the United States, you’ve taken a huge step toward growth. Now you want to ensure the success of your expansion. One of the best things you can do is secure the right people.

Another key is making sure you’re following the law, including tax regulations and employment legislation. Whenever you hire a new worker, you’ll want to be sure you’re familiar with the forms you’re legally required to submit.

You’ll need to submit some US tax forms when you first hire an employee. Some will need to be issued on an annual basis, while others will need to be updated from time to time. Here are five forms you should be familiar with if you plan to employ even one worker in the US.

1. Form W-4 Allows You to Withhold Taxes

The first form you’ll have any employee fill out is a W-4. This form authorizes you to collect and withhold income tax from the employee’s wages.

If an employee doesn’t fill it out, you can’t pay them. It’s in their best interests to complete this form and allow you to file it as soon as possible.

2. Form I-9 Verifies Employment Eligibility

Everyone you hire for your business operations in the US should be legally allowed to work. That’s why they must fill out Form I-9, Verification of Eligibility for Employment. If an employee refuses to fill out and file an I-9, they may not be eligible to work.

Hiring workers who aren’t eligible to work in the US can have repercussions on your business. You may be penalized by the IRS or even subject to visits from immigration officers. It can also disrupt tax withholding and payroll, as employees who are not eligible for employment may also not fill out Form W-4 discussed above.

3. Form W-2 Must Be Filed for Income Tax

As an employer, you’ll also need to fill out and remit Form W-2 each tax year. If you pay any employee more than $600 US in a year, you must complete this form and file it with the IRS.

A copy of your filing should also be sent to the employee for their records. Legally, you must send out W-2s before the end of January each year for the previous year. If you know this is going to be a challenge for your business, you may want to outsource payroll.

4. Form 1099 Is for Contractors

There may be times when you hire workers who don’t quite fit the bill as “employees.” You may hire them for a special project or for consulting work. These people are contractors, and you’ll need to fill out Form 1099.

Contractors engage with you on a business-to-business case, so you don’t need to withhold taxes from them. They don’t need to fill out Form W-4 to authorize you to withhold taxes since they look after their own taxes. Instead of a Form W-2, you’ll provide them with Form 1099 at the end of each tax year.

Make sure you’re classifying your employees and contractors correctly. Employee misclassification can result in penalties for your business.

5. Form SS-5 Must Be Filled out If an Employee Doesn’t Have a Social Security Number

If you hire a new employee, but they don’t yet have a social security number, then they need to apply for one. Form SS-5 is the form they’ll need to fill out.

You’ll need to be sure the employee obtains a Social Security number before you can proceed with the rest of the forms.

These are only some of the forms you’ll need to look after if you employ workers in the US. If you're having trouble keeping up with all the paperwork, you might want to think about outsourcing to a professional employer organization (PEO).

Read Full Article
  • Show original
  • .
  • Share
  • .
  • Favorite
  • .
  • Email
  • .
  • Add Tags 

When you’re expanding to the US market, there are many challenges you’ll face. One of the ongoing issues for global companies is employing American workers. From hiring to termination, there are many tasks to be managed, and you’ll need to be familiar with the ins and outs of American employment regulations.

One way to make these tasks easier is to work with US payroll service providers or a professional employer organization (PEO). The experts on staff can help you manage payroll, monitor compliance, and more.

The question is, how can you be sure you’re hiring the right company? During the decision-making process, you’ll need to compare and contrast different providers. Use these tips, and selecting the right provider will be easier.

1. Ask about Support from US Payroll Service Providers

The first thing you should do is ask about the kind of support you’ll receive with your payroll service. Will you have a dedicated agent or team of people working on your account? Can you contact them? If there’s a significant time zone difference, and how will they manage this?

You should also ask about support for different systems and programs they use. Will you be required to use their programs to log information?

Support is a key factor in finding the right payroll service provider.

2. Determine Your Needs

When you’re comparing US payroll service providers, it’s easy to get caught up with extras you don’t necessarily need. It can also be tempting to choose a bare-bones plan that doesn’t meet all your needs because it fits your budget.

Always keep your needs in mind. If you’re going to need help with more than just US payroll, it might be a good idea to work with a professional employer organization that offers support for human resources, compliance, legal, and more.

3. Ask How They’ll Grow with You

As a business leader, you need to be forward-thinking, so you should take steps to future-proof your relationship with your payroll provider.

You plan to grow your US operations, so ask how the payroll provider will scale with you. Can they keep conduct payroll for 100 or 10,000 employees? If not, it might be time to consider someone else.

4. Think Beyond Payroll

Payroll is certainly one of the more time-intensive tasks related to the employer-employee relationship in the US. It’s far from the only aspect you need to consider.

As you compare US payroll service providers, you should consider whether you need services that go beyond payroll. Would it be helpful to have assistance with HR compliance? What about delivering training and onboarding?

You may want to consider PEOs over US payroll providers alone. A PEO can help you manage payroll and so much more, which could be key to your success in the US market.

Read Full Article

Read for later

Articles marked as Favorite are saved for later viewing.
close
  • Show original
  • .
  • Share
  • .
  • Favorite
  • .
  • Email
  • .
  • Add Tags 

Separate tags by commas
To access this feature, please upgrade your account.
Start your free month
Free Preview