The way we work has changed immeasurably since the COVID pandemic. Hybrid and flexible working is commonplace, with staff sometimes choosing to work overseas for short periods of time – the rise of digital nomads.
As a business grows and has an eye on international expansion, it is sometimes necessary to send staff overseas to support a particular project or grow the business in a specific location.
It is a big decision for the individual looking to relocate and can represent a considerable cost to the business, so advanced planning is essential.
The first question to address is whether asking an employee to relocate is indeed the best and right approach. Relocation can be expensive and will require the employee to be fluent in any language differences and to understand the culture of the country they will relocate to. It can sometimes pay to explore all other options first. This might include hiring local talent, partnering with local businesses or using an agent or third party.
Assuming relocation is the best approach, a business will then need to consider the following.
Legal and compliance
It is likely a work permit and immigration status will be required for an individual to work overseas, and that can take time to secure. Local employment laws will also need to be understood and met, which may include limits on working hours, different holiday entitlements and tax obligations.
Financial considerations
It is unlikely the compensation package in the UK will translate to a different jurisdiction and will likely need to be reviewed. In some instances, it may not be possible to continue to pay that individual via a UK payroll. Any new compensation may have to include private healthcare, pension obligations and different tax requirements and reporting.
On top of that, it will be necessary to support the physical relocation of that individual, perhaps providing accommodation and transportation. Partners and dependents will also need to be considered, including the potential cost of schooling.
Health and wellbeing
Employers will still be responsible for the health and well-being of staff working overseas, and it will often be necessary to provide medical insurance for that individual and dependents. Additionally, at a time of political uncertainty, conflict and natural disasters, it may be prudent to have in place plans that consider the safety of that individual.
Logistical support
Finally, there is the logistical support that individual will need to meet the objectives of the business in establishing an overseas presence. Whilst in the short term it might make sense for the individual to work as an employee of the UK company, should the enterprise succeed and grow, perhaps wishing to hire local staff or establish a physical footprint, the legal status will need to be considered.
The right team
Growing a business internationally is no small undertaking. It needs planning and support both in the UK and on the ground in the country where staff will be based. It pays to have the right team in place from the outset, including accountants and lawyers.
Hillier Hopkins has considerable experience in helping businesses expand and grow internationally with strong connections with accountants around the world through its membership of the TGS network of over 4,000 accountants in 58 countries.
