Payment in Euros Thread poster: e2f
|
|---|
e2f 
United States
Local time: 06:24
English to French
I apologize in advance if this question has already been asked.
I am a US resident but, due to the relative strength of the Euro, I'm starting to get clients in Europe.
I thought I could just send them invoices in Euros (using my current invoicing running number to show that i'm not trying to
cheat any taxman), and ask them to send checks to my father who lives in France and would deposit them on my non-resident bank account over there.
I thought ... See more I apologize in advance if this question has already been asked.
I am a US resident but, due to the relative strength of the Euro, I'm starting to get clients in Europe.
I thought I could just send them invoices in Euros (using my current invoicing running number to show that i'm not trying to
cheat any taxman), and ask them to send checks to my father who lives in France and would deposit them on my non-resident bank account over there.
I thought I would this way eliminate bank charges/exchange rate headaches and have Euros available in Europe when I go there. And of course I was planning to report those incomes on my US taxes.
However, my 1st European client tells me they can't do that because that would create tax-related problems in France (and specifically with URSAF - French social security), both for them and myself.
What is the cheapeast (legal) way out of this situation? ▲ Collapse
| | | | Ralf Lemster
Germany
Local time: 15:24
English to German
+ ...
| Why use a cheque? | Jan 24, 2005 |
Hi Michel,
I thought I could just send them invoices in Euros (using my current invoicing running number to show that i'm not trying to
cheat any taxman), and ask them to send checks to my father who lives in France and would deposit them on my non-resident bank account over there.
But why would you want to use a cheque, instead of simply quoting your account details (IBAN & BIC)? A cross-border cheque payment will still be subject to (sometimes heavy) fees, while bank transfers within the euro zone are very cost-efficient (and very often free of charge).
Does that help?
Best regards,
Ralf
| | | | e2f
United States
Local time: 06:24
English to French
TOPIC STARTER | Cross-border ? | Jan 24, 2005 |
Ralf Lemster wrote: Hi Michel, I thought I could just send them invoices in Euros (using my current invoicing running number to show that i'm not trying to
cheat any taxman), and ask them to send checks to my father who lives in France and would deposit them on my non-resident bank account over there. But why would you want to use a cheque, instead of simply quoting your account details (IBAN & BIC)? A cross-border cheque payment will still be subject to (sometimes heavy) fees, while bank transfers within the euro zone are very cost-efficient (and very often free of charge). Does that help? Best regards, Ralf
Ralf,
Actually that would not be cross-border as both my father (and my bank account) and my client are in France. I'm the only one who's cross-border (in the US).
| | | | Matt Baird
Germany
Local time: 15:24
German to English
| Is the prolem that you want them to write the check to your father? | Jan 24, 2005 |
or is it the use of the check?
If either is the case, then Ralf's suggestion to have your client wire the money directly to your account should be a solution.
Wire transfers are a much more common method of payment in Europe to my knowledge (at least I know this of Germany). I keep a bank account in Germany to which my German clients wire payments to me. This involves no wire transfer fees. To my knowledge, if I acquire clients in other eurozone countries, they will be able to... See more or is it the use of the check?
If either is the case, then Ralf's suggestion to have your client wire the money directly to your account should be a solution.
Wire transfers are a much more common method of payment in Europe to my knowledge (at least I know this of Germany). I keep a bank account in Germany to which my German clients wire payments to me. This involves no wire transfer fees. To my knowledge, if I acquire clients in other eurozone countries, they will be able to easily make payments to this account as well.
In any case, as both you client and your bank account are in France, a direct payment to your account should work.
Best,
Matt ▲ Collapse
| | |
|
|
|
e2f
United States
Local time: 06:24
English to French
TOPIC STARTER | The problem is different | Jan 24, 2005 |
Matthew Baird wrote:
or is it the use of the check?
If either is the case, then Ralf's suggestion to have your client wire the money directly to your account should be a solution.
Wire transfers are a much more common method of payment in Europe to my knowledge (at least I know this of Germany). I keep a bank account in Germany to which my German clients wire payments to me. This involves no wire transfer fees. To my knowledge, if I acquire clients in other eurozone countries, they will be able to easily make payments to this account as well.
In any case, as both you client and your bank account are in France, a direct payment to your account should work.
Best,
Matt
Hi Matthew.
No the problem is that the agency says that because I don't have a VAT ID and I'm generally not set up in Europe, they can't send money (check or wire) to my European account, because there are tax and social security implications and that would cause them legal trouble. As I don't know the law in France I'm not sure whether they are right or not.
Michel
| | | | | | Ken Cox
Local time: 15:24
German to English
+ ...
Hi Michel,
I'm not personally familiar with the French situation, but generally speaking, companies in Europe cannot simply purchase services from private persons, which is what the arrangement you are suggesting would amount to from the legal perspective (and I imagine that the same is true in the US, but there's less control). To be able to be paid directly in France, I think you would have to establish a legally recognised company in France and comply with all the relevant legisl... See more Hi Michel,
I'm not personally familiar with the French situation, but generally speaking, companies in Europe cannot simply purchase services from private persons, which is what the arrangement you are suggesting would amount to from the legal perspective (and I imagine that the same is true in the US, but there's less control). To be able to be paid directly in France, I think you would have to establish a legally recognised company in France and comply with all the relevant legislation.
The simplest solution is to just let your French client pay you by bank transfer to your US bank (and yes, the banks charge horrendous fees for this). If you want to have your payments go to a European location, I strongly suspect that you will have to establish a company in a European country, and naturally any such company will have to comply with the legal requirements of the country where it is located (including filing tax returns). Unless you're doing a substantial amount of business in Europe, it's probably not worth the trouble - unless you happen to be friends with someone who does this sort of think professionally and is willing to do you a favour. ▲ Collapse
| | | | Ralf Lemster
Germany
Local time: 15:24
English to German
+ ...
| No incorporation required | Jan 24, 2005 |
Hi Kenneth,
Although I'm not familiar with the situation in France, I beg to disagree with your general statement:
I'm not personally familiar with the French situation, but generally speaking, companies in Europe cannot simply purchase services from private persons, which is what the arrangement you are suggesting would amount to from the legal perspective (and I imagine that the same is true in the US, but there's less control). To be able to be paid directly in France, I think you would have to establish a legally recognised company in France and comply with all the relevant legislation.
The vast majority of freelancers in Germany is not organised as a company - from a legal perspective, they are sole traders, which doesn't stop them at all from providing services to companies. As far as I'm aware, that is also the case in the UK.
I run my business in the form of a private limited company (German GmbH); two of the freelancers I currently work with are US citizens, one of whom has an account with a German bank. That's not a problem, provided certain elements are provided on the invoice.
Best regards,
Ralf
| | |
|
|
|
Matt Baird
Germany
Local time: 15:24
German to English
| Consult someone about French law | Jan 24, 2005 |
[quote]Michel Lopez wrote:
No the problem is that the agency says that because I don't have a VAT ID and I'm generally not set up in Europe, they can't send money (check or wire) to my European account, because there are tax and social security implications and that would cause them legal trouble. As I don't know the law in France I'm not sure whether they are right or not.
My German clients have only ever asked for my U.S. Tax ID and they were all very pleased when I opened the German bank account as previously they were paying via international wire transfer or PayPal. I suspect that your client is not completely familiar with the law here. I can't imagine that freelancers in France, for example, are required to incorporate.
Therefore, I suggest contacting someone with French legal expertise who can help you and possibly find a solution.
Good luck!
Matt
| | | | RobinB
United States
Local time: 08:24
German to English
| Invoice vs. bank account | Jan 24, 2005 |
Michel Lopez wrote:
However, my 1st European client tells me they can't do that because that would create tax-related problems in France (and specifically with URSAF - French social security), both for them and myself.
What is the cheapeast (legal) way out of this situation?
Michel,
I think your European client is making a problem here where one doesn't actually exist. Provided that your *invoice* shows you to be a US-based service provider, it's totally irrelevant where payment is made. Like Ralf, we also work with some colleagues in e.g. the US who have European bank accounts, to which we pay the money by wire transfer.
Issues of social security or tax liability relate to the country of domicile, not the country of payment.
Robin
| | | | | This could cause trouble for the French company | Jan 25, 2005 |
French companies often ask for your "sole tradership" registration info before paying you. They can be held accountable for paying unregistered workers, so I can see where it might cause an accounting and an accountability problem if they pay funds into a French bank account with no corresponding VAT ID and SIRET/SIREN number.
I can't imagine that it is *impossible* for them to pay you in France, but they probably just don't want the headache of having to provide some justification ... See more French companies often ask for your "sole tradership" registration info before paying you. They can be held accountable for paying unregistered workers, so I can see where it might cause an accounting and an accountability problem if they pay funds into a French bank account with no corresponding VAT ID and SIRET/SIREN number.
I can't imagine that it is *impossible* for them to pay you in France, but they probably just don't want the headache of having to provide some justification that you are a sole trader in the U.S. I am not surprised that they prefer not to do this. I would also be surprised if a French agency agreed to use PayPal.
I have to say I agree with Kenneth, that you'd probably have to register as a "travailleur independent" in France in order for companies to be willing to pay you here.
Bank fees are part of the cost of doing business. I always try to minimize them by combining ivoices, etc. Work something out with your customer for the transfer of funds to your U.S. account. Maybe they could pay any fees levied by their bank and you could take care of the fees charged on your end.
From what I understand, Germany and France are completely different, and the freelancing legislation here is a jungle, believe me!
Good luck!
Sara ▲ Collapse
| | | | Ken Cox
Local time: 15:24
German to English
+ ...
| further comment | Jan 25, 2005 |
Thanks to Ralf for pointing out the difference between a sole trader and a company (legal and business is not my field). What I meant by 'company' was actually something like 'some form of commercial enterprise officially recognised as such by the fiscal authorities', which is something that varies from country to country, as do the legal provisions governing the operations of commercial enterprises.
| | |
|
|
|
John Jory
Germany
Local time: 15:24
English to German
+ ...
| Open an account in Germany ? | Jan 25, 2005 |
[quote]Matthew Baird wrote:
My German clients have only ever asked for my U.S. Tax ID and they were all very pleased when I opened the German bank account ..."
Perhaps you could check with Matthew how he managed to open an account in Germany. As Germany is in the Euro zone, the French agency might be less squeamish.
Just a thought from a lay person.
HTH John Jory
| | | | de-ru-es-en
Germany
Local time: 15:24
Russian to German
+ ...
| Bank accounts in EU/Germany, mode of payment, relation EU client vs. US provider | Jan 25, 2005 |
I have to agree with Ralf Lemster and John Jory.
If the payment and the freelancers' legislation in France is too difficult, you might be suggested open a non-resident's account in Germany. Therefor, when visiting Europe you should appear personally to a bank in Germany.
Personal appearance is suggested because of the law on money laundry.
NEW AFTER EDITING: You should have an official proof of your complete home and/or business address.
It may be t... See more I have to agree with Ralf Lemster and John Jory.
If the payment and the freelancers' legislation in France is too difficult, you might be suggested open a non-resident's account in Germany. Therefor, when visiting Europe you should appear personally to a bank in Germany.
Personal appearance is suggested because of the law on money laundry.
NEW AFTER EDITING: You should have an official proof of your complete home and/or business address.
It may be that the German bank requires a "Zustellungsbevollmächtigter acc. to § 183 - 184 ZPO (DE)"
That means you must provide them an address of a phyisical person or a company who is resident in Germany. If the bank has to deliver you an (official) message, it is considered as for delivered when being delivered to the Zustellungsbevollmächtigter (and timelines do start at that time).
If you don't want to travel to Germany you may consider opening a bank account in Latvia or Lithuania without personal appearance.
Cheques are an obsolete mean of payment. You have to bear high fraude risks - even afer the cheque being credited to your account.
Even for a direct payment from EU to US a SWIFT wire transfer is more preferable as in the majority of cases the bank fees are less than for a cheque.
Wire Payments inside EU now have good conditions, untill 12500 EUR the sender has to pay inland wire transfer fees and the beneficiary has to pay incoming inland wire crediting fees, which vary from 0.00 (!) to let's say 3.00EUR.
For your clients you should provide your US tax ID and if required the copy of a USA tax/business registration document/license in order to prove that you are working legally. If an EU client can be sure that you provide your services legally I would not consider any obstacle in placing an order.
At least for a freelancer and resident in DE to the inland revenue it's equal where I have my accounts. Of course, I must lead a correct internal accounting and declare all incomes...
I must confess: English is a C language. I do not know the legal situation in the USA, only in Germany and Eastern Europe. My explanations shall not lead you to a violation of USA or any other local laws.
[Edited at 2005-01-26 12:23] ▲ Collapse
| | | | e2f
United States
Local time: 06:24
English to French
TOPIC STARTER
Thanks very much to all of you for giving suggestions. As many answers are contradictory, I'm still trying to summarize the situation and decide what to do, but I have a lot more elements than when I started !
Michel
| | | | To report site rules violations or get help, contact a site moderator: You can also contact site staff by submitting a support request » Payment in Euros | Protemos translation business management system | Create your account in minutes, and start working! 3-month trial for agencies, and free for freelancers!
The system lets you keep client/vendor database, with contacts and rates, manage projects and assign jobs to vendors, issue invoices, track payments, store and manage project files, generate business reports on turnover profit per client/manager etc.
More info » |
| | Anycount & Translation Office 3000 | Translation Office 3000
Translation Office 3000 is an advanced accounting tool for freelance translators and small agencies. TO3000 easily and seamlessly integrates with the business life of professional freelance translators.
More info » |
|
| | | | X Sign in to your ProZ.com account... | | | | | |
Login to reply/comment 
Translation news
