How International Contractors Work Abroad as an Expat

Is Working Abroad As An International Contractor For You?

If you are an experienced and skilled worker in your industry, you may be tempted to try your hand at working abroad as an expat; contracting with foreign clients. 

You might find that your role is widely used internationally, opening up many opportunities overseas.

The allure of working in a foreign country can be hard to resist, especially if a contractor finds an optimal role in a great location. But where do you even begin, and how to get the right advice? 

Setting up business abroad is full of logistical and compliance tasks that can overshadow the excitement and adventure of international contracting.  This is not necessarily all negative, but you might be surprised at what is required once you have been hired by the client.  

You  may have not thoroughly assessed working abroad advantages and disadvantages compared to finding clients at home.

We have some tips for you and advice on managing your contracting career in foreign countries, so you can avoid some of the obvious pitfalls. 

Hiring Method

There are multiple hiring methods used by clients for contractors.  In terms of complexity, at the easy end of the spectrum you might be brought on as an employee of your client, even if it’s not your preference.

This could be due to visa sponsorship requirements, or the client’s decision because of payroll or other contractor restrictions.  The client will handle most everything, and you are largely off the hook for compliance.  

But if you want to start a limited company (or work through your existing company) then you might find the process daunting. 

Even traditional self-employment can prove difficult in terms of visas, strict self-employment criteria (like Germany), or registering for work and taxes.  

This is where using an umbrella company can be very helpful to you as they know the local requirements.  Luis was an expat from Spain looking to work with a German client onsite. 

As an EU citizen, work permits were not an issue, and he wanted to work as a self-employed rather than an employee.  He quickly discovered that he would have a hard time meeting the German self-employment criteria, and instead opted to work through a German umbrella company.

Logistics and Resources

In addition to arriving at a hiring method, you will also have to consider all logistics for your contracting journey. 

Preparation and research are key, and will include items like moving, housing, transportation and language skills.  The good news is that many contractors successfully work for clients abroad, and there are resources and partners available to assist you. 

Yours can be a one time expat adventure, or it may lead to years of international living and work which has its own rewards beyond professional accomplishment.  In either case, logistics will always play a role and be a necessary step for you to take.

Will You Regret Moving Overseas to Work for Foreign Clients?

Is international contracting always the right move for you, and might you regret it? 

There are several reasons that a contractor might regret moving to another country for work. 

An expat career is not for everyone, and you may wonder if working abroad is worth it. 

Here are some examples of common regrets of working abroad as an expat:

1. Moving to a cold climate such as northern Europe – Some expats dream of working in the vibrant cities of Europe and gaining significant professional experience.  But climate can be a factor especially for those who are not used to the short days and cold weather as one expat found out.
2. Not chasing your expat dream in the desired location – An expat Australian shared that they had always dreamed of working in Asia (Singapore or Hong Kong), but ended up spending 10 years in America and felt they missed out despite a good career in the US.
3. Leaving behind better opportunities in the home country – Another expat from India regretted pursuing a career in Canada, as it was more difficult than expected and they already had a good job offer in India.  They also missed their family more than expected.
4. Reverse culture shock – Long term expats may find that upon returning to their home country it seems unfamiliar and they feel like outsiders.  This is not so much a regret of working overseas, but more the effect it has when one returns home.
5. Working abroad and leaving family – For those in close knit families this can be a real challenge and source of regret if it’s difficult to visit home often.

How You Can Avoid Missed Career Opportunities Abroad

The obvious way for you to avoid missed career opportunities abroad is to not even consider that the best professional contracting opportunities may be in foreign countries. 

Many people are most comfortable in their own culture, and can’t imagine that other countries can actually offer more.  This is more of a problem in developed countries, as citizens of less developed countries realise the opportunity of high paying jobs overseas. 

There are a few ways to expand your understanding of foreign opportunities including:

• Monitor expat job boards and social media groups 
• Network within your field, but with companies abroad
• Reach out to contractors that have working abroad experience, and gain their insight
• Use a professional recruiter that has a global reach to support an expat career  

Common Myths About Working Abroad

Your impressions of international contracting may not be entirely correct, and might be based on common myths or misperceptions.  Here are a few for you to consider:

• It’s like an extended vacation, with work being the means rather than the end.

This is a common trap, especially in warmer climes and can undermine your work performance if taken too far.  Of course, it can be exciting and fun to work abroad, but it’s still a professional endeavour.  If you are in Madeira, Portugal surrounded by amazing recreation, scenery and a dynamic expat social life, discipline will be key to stay on top of your work.

• One can never fully integrate into the country or client culture.

You might fear that the foreign culture is too difficult to assimilate and feel at home, and that feeling is common. Each country is different, but many expats are surprised to find they integrate very easily if a culture is more open and relaxed than their own.  So, this should not hold you back from contracting, and you can select a country that is similar to your own.

• Foreign language skills are a must.

If you want to work in Latin America, Spanish is certainly helpful.  But many countries use English as the business language so it’s not a complete necessity to know the local language.  You may find that contracting abroad gives you the chance to learn and practise a new language, with the additional motivation of adding to your professional skills.

• Pay rates will be uniformly higher than in your home country.

If you are going to the US from India that is certainly true, but it may not be the case within Europe or APAC where differences may be slight.  You may hear about high-paying offshore jobs, but often those are just stories to impress rather than factual accounts that can guide your decision making.

• Taxes and social security are approximately the same in all countries.

You will need to think about taxes in your preparation, and this is one area where you want exact information.  Expats can get caught off guard by tax and social security rates that reduce their net pay beyond what they expected.  European taxes are notoriously high, but many services are subsidised as well.

• You will lose touch with your home culture, family and friends.

With modern connectivity this is entirely up to you to keep in touch.  There may be time zone differences to contend with, but distance is not a real communication barrier.

• Personal relationships are a real challenge outside of work.

This will depend on your age and knowledge of the local language, but foreign citizens tend to be curious and welcoming to expats.  Developing relationships is a human process, and not really dependent on nationality if you make the effort. 

If you are naturally introverted, working in a foreign country can give you the opportunity to reach beyond your boundaries, if only to learn and explore your new home.

How Contractor Taxation Can Help You with Working Abroad as an Expat

Working abroad as an expat will be smoother if you have a partner to share the load when it comes to client payment, visa sponsorships and tax calculation. 

Contractor taxation has a global network of umbrella companies that can assist you with every aspect of international contracting and setting up business abroad. 

The umbrella company is your in country, local partner who can keep you in compliance and handle contracting administration.

Umbrella companies not only help you manages all client payments, but also tax withholding and any social contributions. Here are some other benefits of hiring an umbrella company:

1. Issues you a payslip each month, to a local or foreign account
2. Sponsors work permits
3. Helps set up the contract with the client
4. Moderates any disputes with your client
5. Advises on access to totalization and double taxation treaties

Got questions about how an umbrella company can help you as an international contractor? Contact us today!

Got Questions About Working Abroad As An Expat?

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