As MIT expands its global reach through international engagements with universities, industries, organizations, and communities, VPF stands ready to provide finance-related guidance and expertise every step of the way.
Here you will find how VPF can support your international projects. For additional guidance, visit the MIT International Coordinating Committee website.
Buying and Paying
The process for purchasing goods and services from non-U.S. suppliers for MIT business is similar to the process for domestic purchasing, with several notable exceptions. You should consider import duties, taxes, and shipping insurance when purchasing goods (see Steps 4 and 5) and services (Step 4), and review export control guidelines for international transactions and relocation of property overseas.
When paying a non-U.S. supplier or service provider, or recipient of an honorarium, you can request an international wire payment. Remember that payments to non-U.S. citizens, including human subjects and recipients of student prizes or awards, are subject to a mandatory 30 percent tax withholding per U.S. government regulations.
To sponsor non-U.S. students or employees, you may need to pay for visa fees.
Finally, if you are planning to travel outside the U.S. on MIT business, be sure to learn the basics of using the MIT ProCard abroad for non-travel related purchases.
Traveling on MIT business outside of the U.S. requires advance planning and an understanding of MIT travel policies. Travelers should have their travel documents in order in advance of their trip. In addition to booking air travel, accommodations and ground transportation, travelers should determine if they are going to file detailed expense reports or be reimbursed by claiming a per diem allowance for expenses.
Tax and Payroll
Before conducting business or research outside of the U.S., understand that global activities may have tax implications for both the Institute and for MIT employees. VPF recommends following specific guidance on hiring or sending an employee abroad. Since MIT is generally not recognized as a tax-exempt organization outside of the U.S., contracts funded by foreign organizations or transactions in foreign jurisdictions may incur tax liabilities.
Conducting business or research overseas includes specific programmatic costs which are not usually considerations for domestic activities.
Budget considerations can include expenses related to foreign currency fluctuations, exporting and customs fees, visas and immigration, indirect taxes in other jurisdictions, and health, safety, and insurance. Note, if you are considering a longer-term overseas project you should understand some potential additional cost considerations.
VPF can assist in estimating or planning costs related to international operations in order to help mitigate their potential impact on your program.
Foreign Payments to MIT
The process for accepting foreign payments to MIT is similar to the process for domestic payments, with several notable exceptions.
Withholding tax may be deducted from a foreign-sourced payment, so you should check for non-U.S. tax withholding and subsequently identify potential documentation requirements that may be tied to the payment. VPF Accounts Receivable can help you understand invoicing in foreign currencies and address Office of Foreign Asset Control (OFAC) regulations.