Once you have decided to expand overseas, there are some common considerations that many companies will need to think about when creating their expansion strategy. We have outlined some of the initial tasks you are likely to encounter and how we can help you navigate them.
Incorporating a Subsidiary, registering a Branch, creating a Partnership or something else?
There are numerous structures through which you can operate. ZEDRA can help you determine the best approach, making sure your global ambitions can be met using expert local knowledge. Once a decision has been made, we can proceed with the set up and registration process.
Sending someone over or local hires?
If you wish to relocate someone from HQ you will need to think about whether it is a one-time project or whether there will be regular expatriates visiting the new office. In all instances, you will need to consider:
• Possible immigration issues;
• Whether an assignment policy is going to be necessary;
• Local employment law and HR including incentive and pension plans;
• Expatriate tax and insurance; and
• Payroll compliance.
Our teams have supported hundreds of companies with their global mobility requirements. Your employees are your biggest asset – you should make sure they get the best advice.
What are the tax filing and payment requirements and which taxes do you need to deal with?
At each stage of the expansion process, you will be thinking about tax. Do you need to register for certain taxes at the beginning? Does your company need to make regular filings or payments during the year to different government agencies? How much time do you have after year end to prepare a tax return? At different times you might need help with:
• VAT (import, export, B2C sales online, SAF-T, Real Time Reporting);
• Employer taxes and social security (payroll obligations, taxing equity awards and stock plans); and
• Corporation tax (transfer pricing, withholding taxes, non-deductible expenses as well as help identifying and using any local tax reliefs or incentives).
ZEDRA can demystify and untangle all these topics with you, creating a clear and concise tax compliance calendar, wherever your expansion plans take you.
What will you do for banking and making payments?
Setting up a bank account in a new location can be bureaucratic and should be factored into your plans as early as possible. ZEDRA can provide a client bank account facility for companies that need to make or receive payments fast, allowing you to keep on top of supplier, employee and customer invoice payments. We can also assist with the opening of a bank account. ZEDRA can coordinate the whole process on your behalf, saving significant time. We work with a wide variety of banks to ensure you have access to the most appropriate accounts to meet your individual needs. Please note, however, that some banks do require you to have an existing banking relationship in another jurisdiction.
Who will keep track of the finances of your new international office?
Your first set-up overseas should be an exciting step on your global journey, but you will need to keep an eye on the new office’s financial performance whilst ensuring any reports or filings are made accurately and on time.
It can be a challenge for a business new to global expansion to make sure that:
• You adhere to local accounting standards;
• Different filing deadlines are tracked and well managed; and
• Suppliers (including missing or incorrect invoices) are handled.
You may wish to consider outsourcing your local statutory and management accounts as well as related procedures. This ensures you comply with local rules, with the added advantage of being able to oversee the international operation from anywhere in the world via an online accounting platform.
If you are considering expanding into a new market or would like to discuss how best to create your global expansion strategy from scratch, please contact one of our professionals listed below Jamie Richardson, Bartek Bielski, Erik-Jan Schoop or Frank Walenta.