What Is Companio Work And How Does It Work?
Companio Work allows you to hire, pay, and manage international employees for your Estonian company from more than 80 countries.
As you know, Companio is focused on supporting location-independent entrepreneurs and freelancers throughout their journey, without interfering with your personal tax situations or obligations in your respective countries.
While location-independent entrepreneurs may no longer be subject to tax obligations in their home countries (if they are not tax-residents there anymore), we wanted to give our customers a tool to hire employees who reside in their home countries, including the board members and shareholders of the business.
Complying with local regulations is crucial for your peace of mind and long-term success. That's why we decided to launch Companio Work, a solution designed to help ensure the compliance of your employees in their countries of residence.
Companio Work is a global hiring and payroll solution, supporting more than 80 countries, and totally integrated in your business accounting.
It allows your business to hire employees from any of these countries, without needing to open a new business (or a branch of your current business) in that country. It is a totally compliant and legal solution that adheres to the legislation of all the supported countries. Your business will be paying all the required taxes (social security, unemployment, pension benefits, etc) to the local authorities of your employee.
We will take care of the contract and registering the employee. Then every month we will pay their salary to the employee, pay all required taxes to the local authorities, and issue the local payrolls for you and your employee.
You simply have to pay a monthly invoice to us.
Companio Work will be activated on October 1st, 2023. On that date, you will find an assistant within your dashboard, guiding you through a migration process. All current employees will be classified as either "contractors" or "employees", but you need to confirm the situation of each one of them.
How? Simple.
Contractors are those who are (or can be) registered as freelancers or businesses in their respective countries and, as such can invoice your business. We won't register them as employees in Companio Work. They need to send an invoice each month for their services, and we advise you to check that they are indeed registered as freelancers or solopreneurs in their home countries.
For those who cannot work as contractors, or you rather keep them as proper employees, we have Companio Work. We will take care of registering them in their respective countries, and we'll pay their salaries, social contributions (social security, unemployment, pension) every month for you. You will just be invoiced for each one of them every month. As easy as pie.
External employees living in Estonia: They will be migrated to Companio Work and will continue working for your company as employees.
External employees living outside of Estonia. As they are tax residents in a country other than Estonia, your company cannot simply pay them a salary. Companio Works allows you to register these workers as proper employees in their countries of residence. Otherwise, they need to register as contractors and invoice your company for their services.
Members of the company who live outside of Estonia that have either an employee salary only (that does not pay taxes anywhere) or a board member salary plus an employee salary (typically in a 20/80 salary distribution). We will unify these salaries into a single one, and you can decide if you want them to become contractors or employees.
Location-independent workers. If you or some of your employees are non-tax residents anywhere, they cannot be employed through Companio Work, and they need to be considered as contractors, invoicing your company every month for their services. Take into account, though, that being a digital nomad is not the same as being non-tax resident anywhere. You need to consult a local tax advisor to understand your obligations with your country of residence or citizenship. If your home country (or any other) considers you a tax-resident, you need to either become a contractor or a proper employee.
Additionally, you can find a comprehensive article in this link explaining the migration process, making the transition smooth and hassle-free.
The advantages of managing your employees through Companio Work are:
✅ Tax Compliance: Companio Work will help you adhere to local tax regulations, minimizing the risk of legal issues related to salary assignment.
✅ Peace of Mind: With our assistance, you can focus on your work, knowing that your financial matters are handled correctly and your employees and contractors are complying with their local regulations.
✅ Payroll Simplified: Companio Work streamlines the payroll process, minimizing administrative hassles. Every month, we provide locally-compliant payrolls for you and your employees. These payrolls play a crucial role in your employees' daily lives, from facilitating mortgage applications to simplifying local tax reporting."
Being a digital nomad does not exempt your employees from fulfilling the tax laws of their country. It is important to consult with a local tax advisor to determine if they are considered a tax resident in any country and if, therefore, they need to register as a freelancer or employee to receive a salary from their company
For digital nomads who are not tax residents in any specific country and willingly accept accountability for potential non-compliance with tax obligations, there is an option to invoice their company as if they were contractors. In this scenario, they can use their current address as the billing address on their invoices.
Why Companio Work?
As you know, Companio is focused on supporting location-independent entrepreneurs and freelancers throughout their journey, without interfering with your personal tax situations or obligations in your respective countries.
While location-independent entrepreneurs may no longer be subject to tax obligations in their home countries (if they are not tax-residents there anymore), we wanted to give our customers a tool to hire employees who reside in their home countries, including the board members and shareholders of the business.
Complying with local regulations is crucial for your peace of mind and long-term success. That's why we decided to launch Companio Work, a solution designed to help ensure the compliance of your employees in their countries of residence.
What is Companio Work and How Does It Work?
Companio Work is a global hiring and payroll solution, supporting more than 80 countries, and totally integrated in your business accounting.
It allows your business to hire employees from any of these countries, without needing to open a new business (or a branch of your current business) in that country. It is a totally compliant and legal solution that adheres to the legislation of all the supported countries. Your business will be paying all the required taxes (social security, unemployment, pension benefits, etc) to the local authorities of your employee.
We will take care of the contract and registering the employee. Then every month we will pay their salary to the employee, pay all required taxes to the local authorities, and issue the local payrolls for you and your employee.
You simply have to pay a monthly invoice to us.
Migrating Your Current Customers
Companio Work will be activated on October 1st, 2023. On that date, you will find an assistant within your dashboard, guiding you through a migration process. All current employees will be classified as either "contractors" or "employees", but you need to confirm the situation of each one of them.
How? Simple.
Contractors are those who are (or can be) registered as freelancers or businesses in their respective countries and, as such can invoice your business. We won't register them as employees in Companio Work. They need to send an invoice each month for their services, and we advise you to check that they are indeed registered as freelancers or solopreneurs in their home countries.
For those who cannot work as contractors, or you rather keep them as proper employees, we have Companio Work. We will take care of registering them in their respective countries, and we'll pay their salaries, social contributions (social security, unemployment, pension) every month for you. You will just be invoiced for each one of them every month. As easy as pie.
Who should be migrated?
External employees living in Estonia: They will be migrated to Companio Work and will continue working for your company as employees.
External employees living outside of Estonia. As they are tax residents in a country other than Estonia, your company cannot simply pay them a salary. Companio Works allows you to register these workers as proper employees in their countries of residence. Otherwise, they need to register as contractors and invoice your company for their services.
Members of the company who live outside of Estonia that have either an employee salary only (that does not pay taxes anywhere) or a board member salary plus an employee salary (typically in a 20/80 salary distribution). We will unify these salaries into a single one, and you can decide if you want them to become contractors or employees.
Location-independent workers. If you or some of your employees are non-tax residents anywhere, they cannot be employed through Companio Work, and they need to be considered as contractors, invoicing your company every month for their services. Take into account, though, that being a digital nomad is not the same as being non-tax resident anywhere. You need to consult a local tax advisor to understand your obligations with your country of residence or citizenship. If your home country (or any other) considers you a tax-resident, you need to either become a contractor or a proper employee.
Additionally, you can find a comprehensive article in this link explaining the migration process, making the transition smooth and hassle-free.
Advantages and Implications of Managing Employees Through Companio Work
The advantages of managing your employees through Companio Work are:
✅ Tax Compliance: Companio Work will help you adhere to local tax regulations, minimizing the risk of legal issues related to salary assignment.
✅ Peace of Mind: With our assistance, you can focus on your work, knowing that your financial matters are handled correctly and your employees and contractors are complying with their local regulations.
✅ Payroll Simplified: Companio Work streamlines the payroll process, minimizing administrative hassles. Every month, we provide locally-compliant payrolls for you and your employees. These payrolls play a crucial role in your employees' daily lives, from facilitating mortgage applications to simplifying local tax reporting."
What about digital nomads?
Being a digital nomad does not exempt your employees from fulfilling the tax laws of their country. It is important to consult with a local tax advisor to determine if they are considered a tax resident in any country and if, therefore, they need to register as a freelancer or employee to receive a salary from their company
For digital nomads who are not tax residents in any specific country and willingly accept accountability for potential non-compliance with tax obligations, there is an option to invoice their company as if they were contractors. In this scenario, they can use their current address as the billing address on their invoices.
Updated on: 20/02/2024
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