Employer of Record (EOR) vs Local Entity Setup — Cost Analysis
Deel, Remote.com vs Local Subsidiary: Breakeven Point Calculator
Tech companies expanding globally face two primary options: contracting through an Employer of Record (EOR) such as Deel or Remote.com, or incorporating a local subsidiary entity. EOR platforms charge a fixed monthly fee per employee (typically $499–$599/seat) and absorb all payroll compliance and employment law liability.
However, once headcount in a single country exceeds 4–6 employees, total annual EOR fees often surpass the one-time cost of local entity formation plus ongoing accountancy. Our breakeven calculator models EOR vs entity total cost of ownership over 1–5 year horizons across all major markets, accounting for setup fees, monthly compliance costs, and legal overhead.
Frequently Asked Questions
At what headcount does a local entity become cheaper than EOR?
Typically when you have 4 or more employees in the same country, incorporating a local entity is more cost-effective than ongoing EOR fees.