Over the years, the emergency market has grown significantly and demands an increased number of professionals with specific abilities. Not only that but from different countries and communities around the world, freelancers have expanded their environment in order to get more income and experience.
Due to this popularization of self-employment, which increased notably after Covid-19, people need to receive payment overseas and generate invoices already considering the VAT of that country, for example. On the other hand, the experience of traveling while working remotely has also gradually over the past few years. Again, to get the payment from the customer, if he or she is a freelancer, needs to issue an invoice, and for issuing an invoice you need to create a company.
Furthermore, if you decide to live in another country through the digital nomad visa, certainly you will need to have registered a company to issue invoices and pay taxes to the determined country. And if we say to you that: for issuing invoiced you do not need to register a company? Besides sounding complicated, since the accounting of taxes, in the end, will be busy you will save time and pay less.
Remotify has created a solution to boost and enhance the freelancer’s quality of time, also offering solutions to make the freelancer earn more income, through a payment platform, where you will pay a commission rate starting from of 2.5%, with a unique deductible invoice. Winding up, you register as self-employed on our system, send invoices, and get paid using only one platform.
Traditionally, creating invoices would require registering a company, which comes with legal obligations and administrative burdens. However, with the emergence of platforms like Remotify, freelancers now have an alternative solution for generating VAT-compliant invoices without the need to establish a formal business entity.
There are more than 30 currencies available and the customer can pay the invoice with EUR, USA, GPB, or Turkish Lira. In addition, the freelancer can add their customer on the system monthly or often, just select the customer, add the price (our platform will consider the 5% automatically), and send the invoice. There is no extra or hidden fee.
We will explore the pros and cons of creating a company versus using Remotify, helping freelancers make an informed decision about which approach suits their specific needs. Also, we would like to introduce an overview of the benefits for your relationship with the customer, in case of choosing Remotify, instead of registering a company.
What is VAT?
Before you head to the next subject, do you know what is Value Added Tax and why is it so important to consider VAT before issuing an invoice?
VAT is a tax imposed on the value considered after the services and goods, commonly used in many countries to generate revenue for the government. Each business involved in the production and distribution process is responsible for collecting the VAT from the buyer and remitting it to the government.
The VAT rate will depend on the country or jurisdiction, paid by the end consumer. Each country will have its rate according to the service and goods, sometimes multiple options, zero rater, or reduced rates. It is collected and remitted by businesses throughout the supply chain. The government uses this tax revenue to fund public services or infrastructure.
Prior to the decision of living or moving to a new country, it is essential to search and check with some sources how the local tax is considerable, in addition, for the customer side, how much they will pay extra as value-added tax and if it is already added on the invoice before to issue it.
To summarize, Remotify offers the possibility of issuing a Value-Added Tax (VAT) invoice and you will not need to have a registered business for that. On our platform, you will be able to generate invoices already considering the country rate and complimentary to the goods and services.
Creating a company
We accurate three advantages of registering a company as a self-employed person. Check below:
1- Legal Formalities and Administrative Burden:
Creating a company can ensure a diverse number of advantages such as business assets, credibility, liabilities, formalization, and distinct legal entity. Nevertheless, in the same way, the legal formalities will be mandatory and strongly recommended, considering the fact of registering with the appropriate authorities, maintaining proper accounting records, and filing tax returns regularly.
Additionally, administrative burden can be time-consuming and demands a specialized awareness about the offered services, extra costs, supply chain, and any other add cost or payment to the freelancer operation.
2-Trustworthiness and Professionalism:
As we emphasized before, registering a company promotes credibility and enhances a freelancer’s reliability and professionalism in the eyes of clients. Moreover, corporate clients tend to prefer to work with established entities.
The second benefit of this topic is the growth of the company name and brand, able to help create a distinct identity, brand awareness and facilitate long-term projects. Your brand will be searched.
3- Tax Benefits and Deductions:
Previously we talked about VAT and the essentialism of government revenue, however many countries can offer deductions and tax benefits for those who have a registered company, benefits that can not be applied to individual freelancers.
A company can often deduct business expenses, such as equipment, office space, and marketing costs, resulting in potential tax savings. Freelancers should consult with tax professionals to understand the specific advantages and implications based on their jurisdiction.
Head to the main three benefits of using Remotify instead of registering a company.
1 – Simplified Invoicing Process:
No secrets or hidden steps, Remotify is simple and you can issue invoices. We simplify the invoicing process for freelancers by providing a platform that enables them to generate VAT-compliant invoices without the need to register a formal company.
Self-employed essentially “rent” the business infrastructure provided by Remotify, allowing them to focus on their core work rather than administrative tasks. This streamlined process can save time and effort, especially for those starting their freelance careers or working on smaller projects.
2 – Cost Savings:
We know how it is expensive and complicated to set up a business and maintain it. However, by using Remotify, the freelancer will avoid the upfront costs associated, without investing in legal and accounting services, office space, and any extra costs related to operational expenses.
This cost-saving is a benefit for those who can not invest at this moment or has a limited budget. Additionally, if you are not issuing invoices monthly or weekly, Remotify is your best choice for requiring occasional invoices and payments.
3 – Flexibility and Agility:
Our platform can be adequate to your project situation and adapt to the circumstances. Contrasting the long-term commitments of creating an invoice, freelancers can use the platform according to a necessity basis.
This flexibility is particularly advantageous for those who work on various projects, have irregular income streams, or prefer a more independent and adaptable work structure.
Save cost using Remotify as your invoicing company
Unless you are planning to establish a business or a brand, Remotify is definitely your best invoicing platform option. Analyze your situation to depend on various factors, including long-term goals, client base, financial situation, and personal preferences. Creating a company offers the advantages of legal separation, enhanced credibility, and potential tax benefits.
On the other hand, Remotify provides a simplified invoicing process, cost savings, and flexibility. Ultimately, freelancers should carefully consider their specific circumstances and consult with professionals to make an informed decision that aligns with their goals and aspirations.