Taxes, Contracts, and Employees – Practical Advice

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Today, I’m going to talk about taxes, contracts and employees.

First, a disclaimer. I am neither an accountant or an attorney. You should always consult either one of those professionals.

Been hiring VAs since 2005. The accountant marks all their salaries under the line item “subcontractors”. Because they’re in the Philippines, they don’t need a 1099. So outside of that line item, there’s no other tax reporting needed.

There w8-BEN. It’s just something they need to fill out that tells the IRS that they’re not Americans so they don’t have any obligation to the US.

Are Filipino VAs employees or subcontractors? I treat them like they’re my employees. But legally and in every way that matters, they are subcontractors. So there’s no standard. How you set things up in your business is up to you. You’re not legally obligated to give them 13th month and all that unless you have a business in the Philippines. I just give them these benefits because I believe that being generous is good and it encourages loyalty.

Contracts and NDAs. I don’t use a contract with my people because I’m lazy and because they’re not really helpful. It’s not even enforceable, unless you’re going to go to the Philippines to enforce it. Your situation might be different but if you want to use one, it’s fine. We have a sample contract in OneVAAway plus a bunch of sample documents you can use.

But you shouldn’t worry so much. The Philippines is a super compliant country. I have seen hundreds of thousands of people outsource. Yes, we have seen problems but most of them are the employers fault. Yes, there are bad Filipino workers out there but based on our experience, most of the time the issue is with the employer.

If you have questions about outsourcing, check out my book: Outsourcing Lever. It’s free. It’s only around 100 pages. And if you want a physical copy, just pay for shipping and I’ll send you a copy of my book.

And if you want to see more videos, check out our YouTube channel or our Facebook page for more outsourcing tips. You can also check out how to get started on hiring Rockstar Virtual Assistants.

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About John Jonas

John Jonas is a long-time outsourcing expert and the creator of OnlineJobs.ph.

Since 2005, John has taught hundreds of thousands of entrepreneurs how to profitably delegate to VAs in the Philippines (and get their lives back in the process).

With help from his own VAs based in the Philippines, John has created an outsourcing empire that allows him to work 17 hours/week and to spend most of his time with his wife and 5 kids.

Find John at JohnJonas.com and Facebook.

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Comments

    • says

      Hi Ronalane,

      Thank you for your comment. Our support team has emailed you regarding your ID Proof score (this affects you being able to apply to job posts), kindly check your inbox

      Reply

  3. Princess Jamaica Ong says

    Hello I am interested to apply for this job. i Hope you grant me to work with you. Thank you.

    Reply

    • says

      Hi Mark,

      Thank you for your comment. You can apply for any of the jobs posted here by signing up for an Onlinejobs.ph jobseeker account. It’s completely free and takes only minutes to apply, though we only allow Philippine workers on the site ->http://www.onlinejobs.ph/register

      Reply

  9. Michael Britton says

    Thanks for the helpful insights for outsourcing to the Philippines. One question about the the w8-BEN – Do your Filipino sub-contractors request a Foreign tax identifying number or do they use the Bureau of Internal Revenue Tax number when completing the W8-BEN form?

    Reply

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