Hiring remote professionals from Latin America for Ireland

Question 1

Contractor or employee: how does Revenue classify the working relationship?

Accepted Answer

For tax, Revenue looks at the facts of how the work is actually done, not only at what the contract calls it. A written contract is considered, but it may not be the only thing that decides the status. Revenue's guidelines say that a line such as "as a self-employed contractor you will be responsible for your own tax" carries little weight. Revenue's guidelines set out a five-question framework taken from the Supreme Court's judgment of 20 October 2023 in Revenue Commissioners v Karshan (Midlands) Ltd t/a Domino's Pizza. The first three questions act as a filter: is there an exchange of work for pay, does the worker agree to provide their own services, and does the engager have enough control for the agreement to be capable of being employment. If all three are answered yes, the fourth question weighs all the circumstances, including whether the facts fit a person working on their own account, and the fifth asks whether any particular legislation adjusts the test. The guidelines quote the Supreme Court as saying that a capacity to profit in a material way from one's own skill, a need to invest significantly in the work, and a requirement to bring tools or equipment all lean against a contract of employment. They add that providing tools along with labour will not always make a relationship self-employment, particularly when the worker is engaged mainly by one business. They also say there is no single, clear legal definition of "employed" or "self-employed" in Irish or EU law. Revenue decides status for tax. Status for PRSI is decided by the Department of Social Protection, and employment-rights questions go to the Workplace Relations Commission. Each body works under its own legislation, and a decision by one body does not bind the other two. If you are unsure which PRSI class applies, the guidelines say the case can be referred to the Department of Social Protection's Scope Section for a determination. In an employer of record arrangement, a commercial provider becomes the person's formal employer and runs their payroll. People First Advisory is not an employer of record and doesn't run payroll. Katia finds and assesses the candidate, and you decide with your accountant or tax adviser how to engage them.

Question 2

Do you pay PRSI and PAYE for an employee working outside Ireland?

Accepted Answer

Revenue's page on Irish employment carried on outside the State says the employee's residence position decides their charge to income tax and USC. For a resident employee who does some duties in Ireland and some abroad, it says you should deduct income tax and USC from all of their income. For a non-resident employee, Revenue may issue a PAYE Exclusion Order, which authorises you not to deduct income tax and USC where certain conditions are met. We did not find those conditions on that page, so ask Revenue or an adviser. PRSI is a separate question. Revenue says PRSI contributions "may or may not be due" when an Irish employment or directorship is carried on outside the State. The Department of Social Protection's guidance says that social insurance is compulsory for all employed persons in the European Economic Area and, as a general rule, is payable in the country where the person works. Under EU rules, an employee posted to another Member State can stay covered by the home scheme for a limited period. That guidance is about the EEA, so it does not by itself tell you whether an employee who lives and works in Latin America owes Irish PRSI. That is a question for the Department of Social Protection or an adviser, and this page cannot settle it. Ireland has bilateral social security agreements with some countries, and EU regulations cover workers moving within the EU. The agreements listed in the Department's guidance are with Australia, Canada, Japan, New Zealand, South Korea, Québec, the United Kingdom and the United States. We found none listed with Costa Rica, Mexico or Colombia, so do not assume an agreement covers your hire, and check the current list. People First Advisory doesn't run payroll or give tax advice, so confirm these points with Revenue, the Department of Social Protection, a payroll professional or an accountant in both countries before the offer goes out.

Question 3

How much of an Irish workday do Costa Rica, Mexico City and Bogotá share?

Accepted Answer

On a 9-to-5 day at both ends, Dublin shares two working hours with Costa Rica or Mexico City in winter and one in summer, and three hours with Bogotá in winter and two in summer. That is our arithmetic, set out below. Ireland uses Greenwich Mean Time (UTC+0) in winter and Irish Standard Time (UTC+1) in summer. The time zone database has Irish clocks going forward on the last Sunday of March and back on the last Sunday of October. This year the clocks go back on 25 October, and the last Sunday of March 2027 falls on 28 March, which is our calendar arithmetic. Costa Rica and Mexico City stay on UTC-6 all year with no daylight saving, and Bogotá on UTC-5, also with no daylight saving. Dublin and Costa Rica or Mexico City: 6 hours apart in winter and 7 in summer. 9am to 5pm in Dublin is 3am to 11am in San José in winter, so you share 9am to 11am there, 2 hours. In summer it is 2am to 10am, so you share 9am to 10am, 1 hour. Dublin and Bogotá: 5 hours apart in winter and 6 in summer. 9am to 5pm in Dublin is 4am to 12pm in Bogotá in winter, so you share 9am to 12pm, 3 hours. In summer it is 3am to 11am, so you share 9am to 11am, 2 hours. These overlaps are our arithmetic from the offsets above. Costa Rica and Mexico City are on the same clock, and Bogotá gives one more shared hour than either. We have not worked out other countries here. Tell Katia how many live hours the role has to share with your team, and that goes into the candidate profile from the first conversation.

Question 4

Can you transfer candidate CVs outside the EU under GDPR?

Accepted Answer

Yes, with conditions. GDPR doesn't stop you transferring personal data outside the EU. Chapter 5 allows a transfer to a country the European Commission has found adequate, or where appropriate safeguards are in place. The Commission's list of adequacy decisions includes Argentina, Uruguay and Brazil. We found no adequacy decision for Costa Rica, Mexico or Colombia on the list we read on 22 October 2026, so check the current list before you transfer. Where there is no adequacy decision, the usual alternative is Standard Contractual Clauses, model clauses approved by the European Commission. The Data Protection Commission says that for the majority of organisations they are the most relevant alternative legal basis. Binding Corporate Rules suit groups of companies, and the Article 49 derogations apply only in specific situations such as consent, performance of a contract or legal claims. A signed contract is one step and not the whole answer. Ask a data protection adviser what else your transfer needs. Katia works from San José, Costa Rica, so interview notes and any candidate data you send her go outside the EU. Ask Katia in the first conversation what transfer arrangements she can offer, and settle the mechanism with your data protection adviser before the search starts.

Question 5

Can you pay a remote contractor in USD, or must it be in EUR?

Accepted Answer

In general the currency is a term you agree in the contract, but we did not look for an Irish rule on it, so ask your accountant or solicitor to confirm. If you and the contractor agree to pay in USD, the contract can say so, and it can fix an exchange rate or leave it to the day of payment. Paying an employee is a separate question. Which tax and employment obligations apply depends on where the person works and where they are resident (see the employment status and PRSI answers above), so ask a tax adviser or payroll professional before you fix the currency. Ask your accountant which exchange rate Revenue accepts when a payment is reported in euro. Tax and social security rules in the worker's own country are outside what this page covers, so settle them with an accountant or lawyer there. Katia finds and assesses the candidate and supports you through the offer and negotiation. You and the contractor or employee settle the currency, payment method and tax obligations separately, with the help of an accountant or lawyer in both countries.

Question 6

Does Irish employment law apply to someone who lives and works outside Ireland?

Accepted Answer

Whether Irish employment law reaches a person who lives and works only in another country depends on the statute and the facts, and the pages cited here do not answer it. Revenue's guidelines make a related point: employment-rights questions go to the Workplace Relations Commission, status for those purposes depends on the definition in each Act, and a decision by Revenue or the Department of Social Protection does not bind the Commission. Latin American countries have their own employment law. In Costa Rica, for example, article 18 of the Labour Code defines an individual employment contract, whatever it is called, as one in which a person provides services to another under permanent dependence and immediate or delegated direction, for pay of any kind, and presumes that contract exists between the person who does the work and the person who receives it. If you hire someone to work in Costa Rica, get advice from a lawyer in Costa Rica, and do the same for Mexico and Colombia. People First Advisory doesn't give legal advice. Before you settle on the terms of engagement, whether a contractor arrangement or an employment contract, consult an employment lawyer in Ireland and one in the country where your new hire will work.