Foreign National Independent Contractors Performing Services in the US

Payments to foreign national independent contractors working in the US are infrequent since these service providers typically work for companies. A contract is usually executed with and payment is made to the company. See the PantherExpress website for more information.

If the service provider is an independent contractor, please see the PantherExpress Guide to help you determine whether the University is permitted by law to pay the independent contractor. If the University is permitted to pay the independent contractor, you will find easy-to-understand US tax withholding options and processing instructions. Please consult this guide before signing an agreement with your independent contractor.

Foreign national service providers working in the US generally accept a US dollar check. However, in the rare case that a wire transfer is required, please see the special instructions on the PantherExpress website.

Relevant information about research-related budget preparation and planning is also available on the Budget Preparation and Planning Considerations pages.

Foreign National Independent Contractors for Services Performed Outside of the US

If you are working on an externally funded project, payments to independent contractors as defined below may not be the appropriate mechanism for hiring service providers. Contact the Office of Research (412-624-7400) for assistance. Additional information can be found in the Research Planning Considerations, Research Agreements, and Research Budget Preparation sections of the website.

The following covers approved methods of contracting and paying for services or goods when the need for a contract to procure such services or goods arises while Pitt representatives are conducting activities outside of the United States. When abroad, Pitt researchers may encounter various levels of contracting sophistication depending on the contractor, the type of services/goods and the locale where the services/goods are being provided.

Agreements

For certain activities of low economic value performed outside of the US, Pitt faculty, researchers and staff are not required to insist on a formal contract. In the chart below, these levels of services can simply be documented with an invoice or receipt provided by the contractor. If the contractor does not have a form of invoice or receipt, blank forms are available.

Contracts for use while abroad are provided in two forms: Services Agreement (Short Form, International) and Services Agreement (Standard, International). These contract templates are drafted in a fair and balanced manner and attempt to avoid any undue advantages to either party.

In most cases, the Services Agreement (Short Form, International) is appropriate to address basic contract needs: identify the parties; describe the services to be performed; identify when and where those services are to be performed; establish the compensation to be paid for the services. A minimum of “boilerplate” terms are included.

The Services Agreement (Standard, International) version is more appropriate if your specific needs involve any of the following:

  • The disclosure of confidential information
  • The use of intellectual property or the need to clarify ownership of work product
  • The hiring of professional services (e.g., attorneys, medical professionals, engineers, architects, accountants, finance and tax advisors, management consultants)
  • Projects involving complex deliverables and heightened levels of risk and liability

If you feel these contract solutions do not address your needs or that your situation requires a more individualized approach, please contact the Office of General Counsel.

Tax Reporting & Withholding

Payments to foreign national independent contractors for work performed outside of the US are generally not subject to US tax reporting and withholding. However, they may be subject to local labor and tax laws, particularly if payments are recurring and/or last more than 90 days; contact Global Operations Support to discuss early in planning your global activities.

Summary of Contracting and Payment Options

The goal of this chart is to simplify the contract process as much as possible and to provide contract templates appropriate to the level of services/goods being obtained.

Day laborers1 Translating & Interpreting Services Laboratory Services Professional Services2 In-Travel Goods Purchases
Contracting
$5,000 or less Invoice / Receipt Invoice / Receipt Invoice / Receipt Services Agreement (Short Form, International) Invoice / Receipt
More than $5,000 Services Agreement (Short Form, International) Services Agreement (Short Form, International) Services Agreement (Short Form, International) Services Agreement (Standard, International) See Payment Options
Payment Options
 

Pitt US Dollar Check
(accepted in most countries)

 

Arrange Pitt US dollar Checks prior to departure. If you do not have a contract, request the check via the Other Payment Request Specialty Form in the PantherExpress System. If you have a contract, use a Services Agreement Specialty Form in the PantherExpress System. Allow approximately three to four days for processing.

 

 

Procurement Card (P-card)

 

You may use a P-card if it is accepted by the service provider, if the purchase is not restricted by policy, and if the amount is within your P-card limit. If the card is declined due to Merchant Category Code (MCC) restrictions, or if the purchase exceeds your P-card’s limit, contact the P-card Administrator to temporarily open the P-card for the purchase.

 

Cash Options

 

  1. Preferred Option: Transfer departmental funds into your personal bank account so that you can withdraw cash as needed. Allow three to four days to process the transfer; withdrawal fees apply – see instructions.
  2. Use personal cash* and include a receipt if the provider cannot produce one – see reimbursement instructions.

* For your personal safety, carrying large amounts of cash is NOT recommended. Contact Global Operations Support before your trip to discuss if cash is your only option.

 

Wire Transfer or Foreign Currency-Denominated Check

 

Arrange wire transfers prior to departure. Due to international banking network complexities, allow up to ten days for processing. Note that there is a $35 fee to process a wire transfer or foreign currency check. Contact your Procurement Specialist, who will assist with contract processing (if required) and payment initiation – see instructions.

 

Personal Credit Card

 

You may use your personal credit card if it is accepted by the service provider – see reimbursement instructions.

CAUTION: If any of the above services are expected to exceed ninety (90) days, please consult with the Office of General Counsel prior to contracting for such services.

1 Day laborers include those individuals hired on a short-term basis to work for an hourly or daily rate; typically to fulfill unskilled or semi-skilled, manual labor needs. Examples include: drivers, porters, diggers/excavators, messengers.

2 Professional services are those involving a high level of skill and educational training. These services typically require certification or licensure by a governing or professional body. Examples include: attorneys, medical professionals, engineers, architects, accountants, finance and tax advisors, management consultants.

US Independent Contractors Working Outside of the US

When a US national or US permanent resident is working outside of the US, they are still paid and required taxes are withheld by US customers (i.e. the University) as if they were working in the US. A standard services agreement can generally be used, however, you should contact the Purchasing Services Procurement Specialist assigned to your responsibility center to determine if there are any special insurance or other requirements. Payment Processing does not require any different information from a US individual to receive payment for services performed outside of the US.

Contact

For more information on independent contractor payments or to answer any questions, please contact the following: