To successfully apply a payroll program for overseas employees, three primary assignment features need to be identified, said David Leboff, president of Expaticore, a third-party aggregator of expatriate and host-country payroll services.
The three features are the length of the assignment, the type of compensation policy to be applied and the appropriate payroll setup.
If the payroll component is incorrectly implemented, assignment costs can greatly outpace what it would cost to employ workers domestically, Leboff said April 21 at the Charm City Payroll Association's annual conference in Lithicum, Md. When managed correctly, employers should expect expenses for expatriates to be about double the expenses for domestic employees, he said.
Assignments may be grouped for those working overseas for up to three months, three months to a year, one year to three years and at least three years. Each group has unique requirements that need to be identified and applied for payroll, including treaty provisions; foreign-earned income credit; requirements for in-country benefits, such as housing; payments made via foreign exchange rates and ensuring that expatriates' net pay seems similar to net pay in the home country, Leboff said.
To succeed, appropriate program oversight is a team effort that should include the payroll department, Leboff said. Governance should deal with expatriate and tax policy development. If payroll is saddled with a policy issue, those in payroll should send the issue to the governance team for a solution, he said.By Michael Baer
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)