Types of International Transfer

When multi-national companies move their employees to & from different countries, they typically structure international moves into 5 general categories.

Common Types of International Transfer

• Permanent Local-to-Local Transfer
• Long Term Assignment
• Short Term Assignment
• Business Trip
• Virtual / Remote Work

Permanent Transfer / Local to Local Transfer

This is an arrangement where someone is permanently moved from the home country to the host country; completely cutting-off the home country employment (almost like a resignation).

Your employment contract in the home country is terminated, and you are subsequently starting a new employment contract in the host country.

There should be no break in tenure.
For example, if the home country employment ends effective 31-Jan, then the host country employment start date should take effect 1-Feb.

Salary is benchmarked at host country market rate, and paid via host country payroll.

External hires could potentially be offered this global mobility program when applying for a new company abroad.

Long Term Assignment / Expatriate Assignment / Secondment

An Expat Assignment is a temporary move from home country to host country, anywhere from 1 – 5 years, and the expectation (not guarantee) is for you to return to the home country after this period.

Salary could be

• Benchmarked to host country market rate
• Retained the same, plus Cost of Living Differential and/or other Allowances

It could be paid either via home or host country payroll, depending on company policy.

The company supports the initial relocation costs of moving to the host country, and potentially on-going costs of living abroad.

Short Term Assignment

Usually between 1 – 6 months, and ideal for project-related work.

It’s like an extended business trip, where the company pays for temporary accommodation, meals and transport allowance or per diem.

The extended duration of a Short Term Assignment, compared to a Business Trip, potentially adds a layer of tax reporting requirement.

Companies cover any additional tax that might arise as a result of the assignment.

International medical insurance is typically provided as well.

Business Trip

Short business visits to another country (1 day – 3 weeks) to attend meetings, trainings, conferences.

No additional employment letter is issued by HR, apart from a Business Invitation Letter (if required for visa purposes).

Flight, hotel, and other business-related expenses could be reimbursed.

Virtual Work or Remote Work

Growing in popularity, virtual work is almost like being a digital nomad, but the employment is continuously maintained in the primary home country.

More progressive companies are now allowing their employees to work remotely for an extended period of time. However, it’s likely that all the employee is expected to be responsible for all expenses involved in working outside their home country.

That means you would be responsible for paying for any additional taxes as a result of working overseas.