At the proposal stage, have a clear idea of project activities and where they will occur. The type and frequency of foreign activities will determine tax and regulatory compliance requirements and liabilities. Projects that anticipate hiring local citizens, signing contracts and/or establishing a long-term (varies, 6+ months) presence may find that some form of legal registration is required by the host country.
When may the need for legal registration in a foreign location arise?
- Likely NOT required
- Short-term research activity (under 6 months)
- Short-term training of foreign citizens
- Study abroad programs
- MAY be required
- Staff/faculty relocation to a foreign site
- Generation of in-country income
- Need to hire foreign citizens as staff
- Funder requirements
- Longer-term research (6-12 months)
- WILL LIKELY be required
- Need to hire foreign citizens as staff
- Need for foreign operating space
- Large and ongoing banking deposits
- Funder requirements
- Advantages of legal registration in a foreign site (12+ months)
Legal registration may help to avoid vendor issues with foreign accounts, personal liability of the principal investigator, and personal income tax issues. It may also support local business, allow for entity banking, vehicle registration, work permitting, vendor contracting, space leasing, reduce personal liability exposure, and any other number of legal advantages.
Much of this information sourced from the University of Washington’s International Projects Start-Up Guide.