My question is as simple as that. The answer is probably just a plain “No” but maybe someone has been in my shoes before.
I started as a digital nomad while freelancing and unexpectedly, it’s going really well. So I hired many freelancers who are helping me out but most freelancers are not very reliable and busy themselves with other projects.
So I was wondering if I could employ someone from Europe with my US LLC while remaining tax free as a digital nomad? Or what’s the best way to set up a business with which I can do that? I would employ someone for part time only to test it out, e.g. for 6 months.
PS: Yes, I already contacted a super expensive consultant but just wanted to ask here if someone has had experience with that.
Thank you
The catch is extra cost. With an EOR, the employee works for them, not for you. The EOR pays their salary, handles tax witholding, potentially provides benefits (which they’ll charge you for), etc. For you it’s just a B2B relationship where you are contracting them for services, and they invoice you an amount. They use the money from that invoice to make their profit and pay the employee. Usually the invoice amount will just be the salary that the employee should be paid, plus their fee, plus cost of any benefits that they can provide that you want the employee to get.
You won’t owe any taxes from your business income since you aren’t employing people or doing business in that country, but the employee will likely still owe taxes. This will be handled by the EOR, but you’d still need to factor that into your salary offer to calculate what the actual take home will be so the offer is competitive.
I’ve been in similar positions but not through an EOR. I used to work for a software consultancy and I ended up contracted out to a single client for the entire time. I effectively just worked for them, but I was still employed by and paid by my company.