Hiring international freelancers gives businesses access to global talent, and that too at competitive rates. However, when the time for payment comes, what should be simple becomes expensive and complicated. This blog will break down why paying overseas workers is perceived as difficult and how smarter payment solutions like Remotify are changing the game.
There are several reasons that experts have identified regarding international payments, and why they are seen as a difficult task.
The Canada Revenue Agency doesn’t only want to know you paid someone, but they want proof as well. When you pay someone abroad, you need detailed invoices that show what services were provided, when they were provided, and how much amount was charged for each. Without proper documentation, the CRA can disallow these deductions during an audit.
Apart from these records, there is a need to keep them for at least 6 years. If you are making $50000 CAD payment to overseas contractors without proper documentation, it could cost you $15000-$25000 CAD in denied deductions and additional penalties. This documentation isn’t optional; it is financial protection.
Beyond these basic invoices, your records should also demonstrate that the expense was reasonable and necessary for your business. All in all, in case of international payments, you need to justify not just the expense, but also the payment method and the costs associated.
Canadian financial institutions face strict oversight from FINTRAC (Financial Transactions and Reports Analysis Centre of Canada). In the past few years, this enforcement has intensified even more, with penalties reaching into the hundreds of millions of dollars for compliance failures.
When you send money internationally, your bank must verify that the transaction is legitimate. This also means that first-time payments to new overseas recipients often trigger automatic holds during the time the investigation is going on. You might need to provide contracts, invoices, and other documents to prove that the payment you made is legitimate.
Large invoice amounts face extra scrutiny. A $10000 payment to a new person in another country will almost certainly be flagged for review. This will only delay the payment by additional days.
High-risk jurisdictions face additional checks. If your freelancer is in a country that the bank considers a high-risk zone, you can expect more questions and longer processing times for the same. Now, one thing to understand is this isn’t your bank being difficult. They themselves are legally required to prevent money laundering and terrorist financing activities. But it makes paying international freelancers more complicated than paying those in Canada itself.
Most Canadian businesses focus on the obvious fee- the $45 wire transfer charge or maybe the 2.9% PayPal commission. But the real number runs deeper. Things like staff time amounting to about $15-30 in labor costs per payment(considering your office manager or accountant works at $30/hour wage rate), failed transactions, and currency exchange losses can aggravate the actual number to a higher amount. Roughly, a $1500 payment to an international freelancer might actually cost your business $1650-1700 when you factor in visible and hidden expenses.
There are several channels that businesses can use for making payments internationally. But understanding what works for each and what doesn’t will help you make a better decision on which one to proceed with.
SWIFT is still the standard for many businesses because it’s what banks have always provided. With Swift as your choice, your bank doesn’t send money directly to your freelancer’s bank. The payment goes through 2 to 4 intermediary banks, each taking a fee and adding processing time. The SWIFT system was created in the 1970s and hasn’t fundamentally changed since.
Real-world costs associated with the platform vary widely. Let’s say you send $2000CAD to a developer in Poland. Now your bank charges $45 for that, and another intermediary bank in New York will take $25, a third one in some other country will take an additional $20, and finally the Polish bank will charge, say $15 more, to receive international transfers. The exchange rate your bank offers has a 2.5% markup, which will cost you another $50. So, to pay $1500, you end up paying $2155, while the developer actually receives a different and lesser amount. That’s money lost to the system and still takes about 3-5 business days.
Paypal works on the principle of convenience, which it does offer. But when it comes to charges, the advertised 2.9% + $0.30 is just the start. Currency conversion will add another 2.5-4%. So for the same $1500 payment, you’re looking at about $105 in total fees. If you do this monthly with say three freelancers, you’re paying about $3780 annually in PayPal fees alone.
Now, another problem with PayPal is, paying through PayPal makes you look less professional to freelancers. It signals that you are treating them like just another online transaction rather than a business partner. Many experienced contractors prefer not to use PayPal for B2B work.
PayPal also has another issue related to business payments, which are often disputed. If a freelancer claims non-delivery or you have two have a disagreement, they can file a chargeback, and PayPal typically sides with the buyer, which means you could lose both the payment and the work.
So, the platform only makes sense for small one-off payments under $500, or when you are working with freelancers who specifically request it.
Wise has built a solid reputation by being clear about fees and providing better exchange rates. It has a smart system that matches your CAD payment with another person’s payment going the other way. This reduces the need for actual international transfers and lets them provide lower fees. But to proceed with the payments using this platform, you and your freelancer must have Wise accounts. Some Canadian banks see Wise transfers as suspicious, so you may need to explain the payments to your bank. Transfer limits could stop you from sending large amounts. Not every country has complete Wise support.
Looking at the real costs, a $2,000 payment will typically cost you around $20-35, which is significantly better than SWIFT. Your freelancer will receive close to the full amount without paying any additional amount for receiving the payment.
Among all these conventional payment platforms available, which are expensive and time-bound, Remotify comes as a big relief. Canadian businesses never have to make an international transfer to pay freelancers. Yes, it might sound surprising, but that’s the basic principle, or say, the business model it operates on.
With Remotify, you pay in CAD to a Canadian bank account, and that’s it. It’s like you’re only paying a Canadian service provider. This solves multiple issues, all at the same time, like:
This is where Remotify is especially useful for businesses with multiple freelancers. Instead of handling five different international payments to five different countries, you receive consolidated CRA-acceptable cross-border invoices issued by Remotify. Each invoice is correctly formatted for Canadian tax compliance, includes all the necessary information, and integrates smoothly into QuickBooks, Xero, or any accounting system you use.
It will also be convenient for your bookkeeper, as he views these as normal domestic supplier payments. There is no special handling, no complex reconciliation, and no concerns about exchange rates or international fees.
At tax time, you have clear records that show payments made to a Canadian business for professional services. You receive clear documentation suitable for CRA record-keeping and audit purposes, and you haven’t wasted hours dealing with the logistics of international payments.
While you make simple CAD payments, Remotify takes care of the complex task of sending money to your freelancers:
In most cases, freelancers receive their payout within 24 hours after payment clearance, depending on the selected payout method. That’s faster than they would receive it through other payment methods.
Remotify is easy to get started with. Starting with the initial setup, which hardly takes 10 minutes, the freelancer you need to pay will need to create a Remotify account and complete the ID verification. Ask them to add their company information as a client. Once they have done that, you will receive an email notification regarding the same. When the account is set up, the following steps can be followed to make a payment:
Disclaimer: Remotify does not provide tax, legal, or employment services. Freelancers are fully responsible for the work they deliver and for their own tax obligations. Remotify acts as a payment consolidation and invoicing intermediary. Service delivery and contractual responsibility remain fully with the freelancer.
If you are currently using traditional methods to make international payments, it is high time you start using Remotify to save costs. The real savings compared to the hidden costs of international transfers will start making sense automatically. If you are skeptical about shifting to the platform, you can start with one freelancer payment to test the process and see how it goes. You will see how simple it is to make payments to other countries, and your team will thank you for eliminating one of the most frustrating monthly tasks.
The fees range from 2.5% to 4% of the invoice amount. The fees decrease as your transaction volume goes up. For most businesses, this is cheaper than the total cost of international wire transfers when you factor in bank fees, exchange rate markups, staff time, and failed transfer costs.
Here’s a simple comparison: a $2,000 payment via SWIFT costs about $2,155 in total. The same payment through Remotify costs around $2,058 to $2,080. You save money and time.
Yes. You are paying a Canadian business, Remotify, for professional services, and you receive an EU tax invoice. This is completely legitimate and provides the documentation the CRA needs.
Remotify’s support team takes care of any issues. If there’s a problem with a freelancer’s payout method or if a payment is delayed, they handle it directly with the freelancer. This lifts the load off your team. You’ve already met your responsibility by paying Remotify.
Typically, freelancers receive their payment usually within 24 hours or the next business day, after it clears with Remotify. This is faster than international wires, which take 3 to 5 days, and it’s similar to PayPal but comes at a lower cost.
There are several reasons that experts have identified regarding international payments, and why they are seen as a difficult task.
The Canada Revenue Agency doesn’t only want to know you paid someone, but they want proof as well. When you pay someone abroad, you need detailed invoices that show what services were provided, when they were provided, and how much amount was charged for each. Without proper documentation, the CRA can disallow these deductions during an audit.
Apart from these records, there is a need to keep them for at least 6 years. If you are making $50000 CAD payment to overseas contractors without proper documentation, it could cost you $15000-$25000 CAD in denied deductions and additional penalties. This documentation isn’t optional; it is financial protection.
Beyond these basic invoices, your records should also demonstrate that the expense was reasonable and necessary for your business. All in all, in case of international payments, you need to justify not just the expense, but also the payment method and the costs associated.
Canadian financial institutions face strict oversight from FINTRAC (Financial Transactions and Reports Analysis Centre of Canada). In the past few years, this enforcement has intensified even more, with penalties reaching into the hundreds of millions of dollars for compliance failures.
When you send money internationally, your bank must verify that the transaction is legitimate. This also means that first-time payments to new overseas recipients often trigger automatic holds during the time the investigation is going on. You might need to provide contracts, invoices, and other documents to prove that the payment you made is legitimate.
Large invoice amounts face extra scrutiny. A $10000 payment to a new person in another country will almost certainly be flagged for review. This will only delay the payment by additional days.
High-risk jurisdictions face additional checks. If your freelancer is in a country that the bank considers a high-risk zone, you can expect more questions and longer processing times for the same. Now, one thing to understand is this isn’t your bank being difficult. They themselves are legally required to prevent money laundering and terrorist financing activities. But it makes paying international freelancers more complicated than paying those in Canada itself.
Most Canadian businesses focus on the obvious fee- the $45 wire transfer charge or maybe the 2.9% PayPal commission. But the real number runs deeper. Things like staff time amounting to about $15-30 in labor costs per payment(considering your office manager or accountant works at $30/hour wage rate), failed transactions, and currency exchange losses can aggravate the actual number to a higher amount. Roughly, a $1500 payment to an international freelancer might actually cost your business $1650-1700 when you factor in visible and hidden expenses.
There are several channels that businesses can use for making payments internationally. But understanding what works for each and what doesn’t will help you make a better decision on which one to proceed with.
SWIFT is still the standard for many businesses because it’s what banks have always provided. With Swift as your choice, your bank doesn’t send money directly to your freelancer’s bank. The payment goes through 2 to 4 intermediary banks, each taking a fee and adding processing time. The SWIFT system was created in the 1970s and hasn’t fundamentally changed since.
Real-world costs associated with the platform vary widely. Let’s say you send $2000CAD to a developer in Poland. Now your bank charges $45 for that, and another intermediary bank in New York will take $25, a third one in some other country will take an additional $20, and finally the Polish bank will charge, say $15 more, to receive international transfers. The exchange rate your bank offers has a 2.5% markup, which will cost you another $50. So, to pay $1500, you end up paying $2155, while the developer actually receives a different and lesser amount. That’s money lost to the system and still takes about 3-5 business days.
Paypal works on the principle of convenience, which it does offer. But when it comes to charges, the advertised 2.9% + $0.30 is just the start. Currency conversion will add another 2.5-4%. So for the same $1500 payment, you’re looking at about $105 in total fees. If you do this monthly with say three freelancers, you’re paying about $3780 annually in PayPal fees alone.
Now, another problem with PayPal is, paying through PayPal makes you look less professional to freelancers. It signals that you are treating them like just another online transaction rather than a business partner. Many experienced contractors prefer not to use PayPal for B2B work.
PayPal also has another issue related to business payments, which are often disputed. If a freelancer claims non-delivery or you have two have a disagreement, they can file a chargeback, and PayPal typically sides with the buyer, which means you could lose both the payment and the work.
So, the platform only makes sense for small one-off payments under $500, or when you are working with freelancers who specifically request it.
Wise has built a solid reputation by being clear about fees and providing better exchange rates. It has a smart system that matches your CAD payment with another person’s payment going the other way. This reduces the need for actual international transfers and lets them provide lower fees. But to proceed with the payments using this platform, you and your freelancer must have Wise accounts. Some Canadian banks see Wise transfers as suspicious, so you may need to explain the payments to your bank. Transfer limits could stop you from sending large amounts. Not every country has complete Wise support.
Looking at the real costs, a $2,000 payment will typically cost you around $20-35, which is significantly better than SWIFT. Your freelancer will receive close to the full amount without paying any additional amount for receiving the payment.
Among all these conventional payment platforms available, which are expensive and time-bound, Remotify comes as a big relief. Canadian businesses never have to make an international transfer to pay freelancers. Yes, it might sound surprising, but that’s the basic principle, or say, the business model it operates on.
With Remotify, you pay in CAD to a Canadian bank account, and that’s it. It’s like you’re only paying a Canadian service provider. This solves multiple issues, all at the same time, like:
This is where Remotify is especially useful for businesses with multiple freelancers. Instead of handling five different international payments to five different countries, you receive consolidated CRA-acceptable cross-border invoices issued by Remotify. Each invoice is correctly formatted for Canadian tax compliance, includes all the necessary information, and integrates smoothly into QuickBooks, Xero, or any accounting system you use.
It will also be convenient for your bookkeeper, as he views these as normal domestic supplier payments. There is no special handling, no complex reconciliation, and no concerns about exchange rates or international fees.
At tax time, you have clear records that show payments made to a Canadian business for professional services. You receive clear documentation suitable for CRA record-keeping and audit purposes, and you haven’t wasted hours dealing with the logistics of international payments.
While you make simple CAD payments, Remotify takes care of the complex task of sending money to your freelancers:
In most cases, freelancers receive their payout within 24 hours after payment clearance, depending on the selected payout method. That’s faster than they would receive it through other payment methods.
Remotify is easy to get started with. Starting with the initial setup, which hardly takes 10 minutes, the freelancer you need to pay will need to create a Remotify account and complete the ID verification. Ask them to add their company information as a client. Once they have done that, you will receive an email notification regarding the same. When the account is set up, the following steps can be followed to make a payment:
Disclaimer: Remotify does not provide tax, legal, or employment services. Freelancers are fully responsible for the work they deliver and for their own tax obligations. Remotify acts as a payment consolidation and invoicing intermediary. Service delivery and contractual responsibility remain fully with the freelancer.
If you are currently using traditional methods to make international payments, it is high time you start using Remotify to save costs. The real savings compared to the hidden costs of international transfers will start making sense automatically. If you are skeptical about shifting to the platform, you can start with one freelancer payment to test the process and see how it goes. You will see how simple it is to make payments to other countries, and your team will thank you for eliminating one of the most frustrating monthly tasks.
The fees range from 2.5% to 4% of the invoice amount. The fees decrease as your transaction volume goes up. For most businesses, this is cheaper than the total cost of international wire transfers when you factor in bank fees, exchange rate markups, staff time, and failed transfer costs.
Here’s a simple comparison: a $2,000 payment via SWIFT costs about $2,155 in total. The same payment through Remotify costs around $2,058 to $2,080. You save money and time.
Yes. You are paying a Canadian business, Remotify, for professional services, and you receive an EU tax invoice. This is completely legitimate and provides the documentation the CRA needs.
Remotify’s support team takes care of any issues. If there’s a problem with a freelancer’s payout method or if a payment is delayed, they handle it directly with the freelancer. This lifts the load off your team. You’ve already met your responsibility by paying Remotify.
Typically, freelancers receive their payment usually within 24 hours or the next business day, after it clears with Remotify. This is faster than international wires, which take 3 to 5 days, and it’s similar to PayPal but comes at a lower cost.
