In partnership with Rippling
Set Up Your Own Entity
Registering a legal entity gives you the most control. You own the employment relationship, the local payroll, and the compliance. The tradeoff is time and money: standing up an entity can take months and carries ongoing accounting, tax, and filing costs.
For most startups making a first hire or two in a country, that overhead is hard to justify. It starts to make sense once your headcount there is high enough that the per-employee cost of the alternatives adds up.
Use an Employer of Record
An Employer of Record already has an entity in the country and employs the person on your behalf while they do their day-to-day work for you. You get someone hired and paid in days without opening an entity, and the provider handles local contracts, payroll, benefits, and compliance.
Pricing is per employee, so an EOR is usually the fastest, cheapest route when you have one or a few people in a country. Past a certain headcount, your own entity can come out cheaper.
Engage Them as a Contractor
Hiring a contractor is the fastest way to start and the lightest to run. The risk is misclassification: if the working relationship looks like employment, with set hours, ongoing work, and your tools and direction, many countries will treat the person as an employee no matter the label, which can mean back taxes and penalties.
Contractors fit independent, project-based work, not a full-time hire in everything but name.
How to Choose
Three questions get you most of the way:
- 1.How many people are you hiring in this country? A single hire points to an EOR. A growing local team points toward your own entity.
- 2.How long do you expect to operate there? Short-term or uncertain timelines favor an EOR or contractor. Long-term presence favors an entity.
- 3.How much compliance do you want to own yourself? An independent contributor doing project work points to a contractor. A full-time hire you want on payroll fast points to an EOR.
We Recommend: Rippling
Rippling offers Employer of Record, global payroll, and contractor management on one platform, so you can pick the model that fits each hire and change it later. If someone starts as a contractor and you decide to bring them on as an employee, Rippling converts them while keeping their record and history intact, instead of firing and rehiring them in a new system.
It runs on one employee data model, so the same system that pays people abroad also handles their HR, benefits, devices, and app access, rather than an EOR tool bolted to a separate HR and IT stack. As a startup's global setup changes, Rippling can change with it without a migration.
Try RipplingNone of this is legal or tax advice. Local rules vary, so confirm the specifics for each country before you hire.
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