What's the cheapest way to become legally employed?

Life Hacking
1

What’s the cheapest way to become legally employed while doing little or no work? i.e. just have a token job so that you are ‘on paper’ employed. This doesn’t need to be ‘real’ employment (e.g. that meets AHV requirements) just that on paper you have an employment contract and receive some mimimal salary?

Perhaps the simplest way would be to start your own company and employ yourself, but then which jurisdiction would you establish in? For example, Switzerland has large capital requirements and services are expensive to run the company (e.g. if you outsource accounting, taxes and company filings) - also something where you can do everything yourself in English would be an advantage for me.

The English requirement then leads me to think of: Ireland, UK, Estonia(?), Isle of Man, Jersey, Malta (USA, BVI, Bermuda, Hong Kong, Singapore, NZ, OZ, etc. I exclude due to physical distance and I expect costs - though maybe I am wrong and happy to be corrected - if everything can be done digitally, maybe distance isn’t a factor, though maybe it could be for setting up a bank account). Any recommendations for cheapest/least admin/most friendly?

Ideally, you should be able to have a single non-resident director / company secretary.

Country Notes
Ireland
UK about £12 incorporation. £13 annual filing. only 1 director required. reasonable tax authorities.
Estonia >€100 e-resi fee. €265 company registration. €300 legal address fee per year.
Isle of Man
Jersey
Malta
USA
BVI
Bermuda
Hong Kong
Singapore SGD$300 company registration. Local nominee directors etc. can get expensive
NZ
OZ
1 Like
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I heard Estonia was pretty easy and geared towards your requirement of no physical presence.

Just keep in mind that many countries have started to apply place of effective management (PoEM) tests to determine where your company should be a tax resident. Switzerland is one of them.

Edit: But it seems you still need a contact person (200 - 400 EUR per year) in Estonia. They don’t have any rights at your company, though.

3

Yes, it seems many have moderate fixed costs. The UK might actually turn out to be the cheapest!

4

Or ask a friend to hire you for cleaning their house? Compensate them by hiring them for something else?

Is this about the 2nd Pillar? Careful with Anobag.

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Estonia has some fun quirks regarding director’s salaries about wholly-owned companies.

When you’re paying yourself a salary from your own firm, you have to define which part of that is due to being a director, vs due to being an employee.

This is because director’s fees are subject to taxation in Estonia (20% income taxes and perhaps 33% social taxes on top)

See the e-residency knowledge base

6

Apply for a job and get hired.
Simply as that.

There are quite a few jobs that require little to no formal qualification or training.

You could work as a cleaner/housekeeper, courier, baggage handler, security guard…

Some of these jobs arguably require some local language, but you did mention you speak/understand some German, didn’t you?

Definitely not, when you are responsible for handling social security contributions and taxes with your company - instead of having an employer that does it for you.

7

The easiest and cheapest way to become legally employed in Switzerland, is to be employed by a Swiss company. About 5.3m others have already choosen that option.

Forget about any fantasies of incorporating in other (tax-haven) countries. It will cost you more in terms of money and headaches. It will also save you a lot of questions from the tax office, too.

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Sorry. I forgot to add the important factor: be employed while doing next to no work. Say 1 hour per month.

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Your post doesn’t make sense to me without further context. What’s the point of this (non-AHV) employment status that you’re looking for?

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I was about to ask that. What is the context, and the need/goal behind it?

11

You’re right. There are several possible scenarios where being employed is a requirement (though they may require varying levels of employment intensity).

I’m thinking of 2 scenarios:

  1. To stay employed or self-employed to be able to make voluntary contributions to UK National Insurance; and
  2. To defer retirement and cashing in of pension fund beyond retirement age. Previously you could defer 5 years, now you can defer only if employed, but AFAIK, there are not yet definitions on what degree of employment is required.

For the second one, getting actual real employment might be quite challenging at retirement age even before the requirement of having minimal hours.

12

Try to find something low hours that you might like. Since you are not after fair financial compensation, there is bound to be something. Maybe you like your work, but not at that many hours. Maybe there is demand for that at a non-profit / association?