How to Start a Recruitment Agency in the USA from Abroad (2026), Without Visiting: US LLC or C-Corp, EIN Without an SSN, Bank Account, Placement Fees, State Agency Licences, Pay Transparency Laws and Running Recruiters Offshore

Permanent recruitment is one of the cleanest businesses to run in the USA from another country. A recruiter in London, Bengaluru, Cape Town or Manila finds a candidate for a US employer, the candidate starts work, and the employer pays a fee. The recruiter never employs the candidate, never runs payroll and never needs to be in the USA.

That is the key difference from IT staffing, where your company places contractors who work in the USA and often employs them. A recruitment agency sells a search service, and the search is done wherever your recruiters sit.

A US company makes it much easier to sign US employers, get paid in dollars, and look like the local partner hiring managers expect. This guide explains how to set one up remotely and the US rules that apply specifically to recruiters.

In short: You can form a US LLC or C-Corporation without visiting, get an EIN without an SSN or ITIN, and open a US business bank account remotely. A permanent-placement agency whose recruiters all work outside the USA usually has no US-source income, so a foreign-owned single-member LLC generally owes no US federal income tax, but must file Form 5472 each year. Fees are typically 15% to 25% of first-year salary on contingency, or a retained fee paid in stages. US employers will expect clear terms of business with a replacement guarantee. Check state employment-agency licensing where you place people, follow salary range disclosure laws in job ads, and never charge candidates.

Why recruitment works so well from abroad

• No employees in the USA. The candidate works for the client, not for you.
• The work is done where you are. Sourcing, screening, interviewing by video and negotiating offers all happen from your office.
• High fee per placement. One senior hire at $150,000 on a 20% fee is $30,000 to your company.
• Time zones can help. A team in India or the Philippines can source overnight, so the hiring manager has a shortlist in the morning.
• Low start-up costs. A laptop, LinkedIn Recruiter, a job board subscription and an applicant tracking system.

What holds most offshore recruiters back is not the work but the paperwork: US employers want a US vendor, a contract under US law and a way to pay by ACH. A US company provides all three.

Can you open a recruitment agency in the USA without visiting?

Yes. Every step is remote:

The company exists within days. The EIN for a foreign owner usually takes one to four weeks, and the bank account follows. See how to open a US company without visiting and EIN for non-residents.

Opening the bank account remotely

Recruitment is easy for banks to understand. A website naming your specialism (for example "nurse and allied health recruitment for US hospitals" or "senior engineering hires for US SaaS companies"), recruiters' LinkedIn profiles, and a sample fee agreement make the application stronger. See the US business bank account guide and why banks reject non-resident applications.

US LLC or C-Corp for a recruitment agency

US LLC formation for a recruitment agency

A single-member LLC is the usual choice for a recruiter or small search firm owned from abroad.

• It is disregarded for US federal tax. If your recruiters all work outside the USA and the company has no US office, staff or dependent agents, the fees are for services performed abroad, so they are foreign-source, and the LLC normally pays no US federal income tax.
• It still files Form 5472 with a pro forma Form 1120 every year. The penalty for not filing is $25,000. See Form 5472 explained.
• The profit is taxed in your country of residence, under its rules for foreign LLCs.

A Wyoming LLC with EIN is $249, or $348 with a US business bank account, and $121 a year to keep active.

US C-Corp formation for a recruitment agency

A C-Corporation pays 21% federal tax on its profit and files Form 1120. It suits a recruitment business that will:

• hire recruiters or business-development staff in the USA, which would create US-source income anyway
• bring in partners or sell shares
• add a staffing or contract arm, where a corporation is usually better

A Delaware corporation with EIN is $358, and $578 a year. See LLC vs Inc for non-residents.

When an LLC stops being tax-free in the USA

If you send a recruiter to live and work in the USA, open a US office, or appoint a US person who regularly negotiates and closes client agreements for you, part of the income becomes effectively connected with a US business. With a disregarded LLC, that becomes your US taxable income, and you file a US return. Plan that move before it happens. See effectively connected income.

How US recruitment fees work

Your terms of business

US employers expect a written agreement before you send a CV. It should cover:

• The fee and how base salary is defined (whether bonuses or sign-on payments count)
• When the fee is due, usually on the candidate's start date, payable within 15 to 30 days
• The guarantee: if the candidate leaves or is let go within 60 or 90 days, you find a replacement or refund part of the fee
• Candidate ownership: for how long (often 6 or 12 months) a hire of a candidate you introduced earns your fee, even if the client hires them for a different role or through someone else
• Governing law, often the law of the state where the US company is formed or where the client sits

Disputes in recruitment are usually about candidate ownership and backdoor hires. Record when and how each candidate was introduced, and keep the email.

State rules for recruitment agencies

There is no federal licence for recruiters. Some states regulate employment agencies:

• Several states, such as New York, New Jersey and Connecticut, require private employment agencies to be licensed or registered, and the details depend on whether the agency charges job seekers, which industries it serves and where it operates.
• California regulates employment agencies that charge job seekers, including a bond requirement.
• Many states exempt agencies whose fees are paid only by employers, but not all, and some cities add their own rules.

Before you place candidates into a state, check whether its rules reach an out-of-state agency that is paid by the employer. Most specialist recruiters charging only employers find their obligations are light, but a licence requirement you miss can make a fee uncollectable.

Never charge candidates. Fees from job seekers are banned or tightly restricted in many states, and in the USA they are a common sign of a scam.

Job ads: pay transparency and anti-discrimination

Salary range laws

A fast-growing number of US states and cities require job postings to include a good-faith pay range. They include California, Colorado, Washington, New York, Illinois, Minnesota, Maryland, Massachusetts, New Jersey, Vermont, Hawaii and the District of Columbia, plus cities such as New York City and Jersey City. Most of these laws apply to employment agencies posting on an employer's behalf, and some apply when the job could be done by someone in that state, which catches many remote roles.

If you post jobs, put the range in the ad. It is also what US candidates now expect.

Equal employment opportunity

US anti-discrimination law applies to how roles are advertised and screened:

• No preferences by age ("recent graduate", "young team"), sex, race, religion, national origin or disability
• No "US citizens only" or "green card only" requirements unless a law, regulation or government contract requires it. "Must be authorised to work in the USA" is the usual safe wording.
• No "H-1B only" ads, which the Department of Justice has repeatedly pursued

Your client is the employer, but agencies can be liable for discriminating on a client's instruction. Push back on discriminatory requests in writing.

AI screening tools

If you use automated tools to screen or rank candidates, check the local rules. New York City requires a yearly bias audit and candidate notice for automated employment decision tools used on NYC jobs. Illinois regulates AI analysis of video interviews, and Colorado has passed a broader AI law affecting hiring decisions. Disclose AI use, and keep a person in charge of decisions.

Background checks

If your agency orders background checks, the Fair Credit Reporting Act applies: a standalone written disclosure, the candidate's written consent, and notices before and after any adverse decision. Many agencies leave checks to the client.

Candidate data

You will hold a lot of personal data: CVs, salary history, contact details, interview notes.

• US state privacy laws, such as California's CCPA as amended, cover applicant data once a business meets their thresholds.
• Several states and cities ban asking about salary history.
• Your own country's law applies to the data your team handles: the GDPR and UK GDPR in Europe, India's Digital Personal Data Protection Act, and so on.
• Keep a written retention policy, and delete old candidates on request.

Running your recruiters offshore

Most agencies set up this way have:

1. The US company, which signs clients, invoices and receives the fees.
2. Recruiters abroad, either employed by a home-country company or engaged as contractors.

If you already have a home-country recruitment company, an intercompany services agreement under which it provides recruitment services to the US company, priced at cost plus a mark-up or on a fee-sharing basis, keeps both tax authorities satisfied. Record every related-party payment for Form 5472.

If the US company pays recruiters abroad directly, collect a W-8BEN from each. Services performed outside the USA are not US-source, so there is no US withholding and no Form 1099. See paying contractors abroad. Check your recruiters' employment status under local law.

If you are an Indian resident, setting up and funding the US company is an Overseas Direct Investment under FEMA. See ODI rules for Indian residents.

Getting paid

• Invoice from the US company in its exact legal name, on the candidate's start date.
• Ask US clients to pay by ACH to your US account; give them a W-8BEN or W-8BEN-E for a foreign-owned single-member LLC, or a W-9 for a C-Corporation. See W-8BEN-E vs W-8BEN.
• For smaller clients, accept cards through Stripe and pass on or absorb the fee. See Stripe for non-residents.
• Move money home when it suits you. See receiving payments from US clients.

Sales tax

Recruitment and placement services are not subject to sales tax in most states. A handful of states tax some employment or personnel services, so check before you place regularly into a new state. See state taxes for foreign-owned companies.

Worked examples

These are illustrative examples, not client stories.

A tech recruiter in Bengaluru. Kavya has placed engineers for Indian start-ups for eight years and wants US SaaS clients. Kavya forms a Wyoming LLC under the ODI route, gets an EIN and a US bank account, and signs contingency agreements at 20% with a 90-day replacement guarantee. Three placements at $140,000 bring in $84,000, received by ACH. All recruiting is done in Bengaluru, so the LLC has no US income tax. It files Form 5472 each year, and the income is taxed in India.

An executive search firm in London. A two-partner UK firm places finance directors and wants to win US private equity portfolio companies. It forms a Delaware C-Corp, as it plans to hire a partner in New York within two years. Until then, the UK company carries out the searches for the US corporation under an intercompany agreement, and the US corporation keeps a margin for its client-facing role. Retained fees are billed in thirds.

An RPO team in Manila. Miguel's Philippine company provides sourcing for US healthcare employers. It forms a US LLC to contract with the US clients and receive monthly retainers. Job ads for roles in Washington and Colorado include salary ranges. The team follows each client's instructions on candidate data, and Miguel's company signs a data processing agreement with each client.

Common mistakes

• Sending CVs before signing terms of business, then arguing about the fee.
• Job ads without salary ranges for roles in states that require them.
• Discriminatory wording copied from a client's brief.
• Charging candidates any fee.
• Placing a recruiter in the USA with a single-member LLC and not realising the owner now has US taxable income.
• No W-8 form to clients, so they withhold or delay payment.
• Forgetting Form 5472 because the LLC "had no US income".

Frequently asked questions

Can I start a recruitment agency in the USA from India or the UK without visiting? Yes. Forming the company, getting the EIN and opening a bank account can all be done remotely.

Do I need an SSN or ITIN for my recruitment company's EIN? No. Foreign owners apply on Form SS-4 without either.

Will my US LLC pay US tax on placement fees? Usually not, if all recruiting is done outside the USA and you have no US office or staff. It must still file Form 5472.

Do I need a licence to recruit for US employers? There is no federal licence. Some states license employment agencies, mainly those that charge job seekers. Check each state you place into.

Can my agency recruit candidates from outside the USA for US employers? The recruiting can be done, but the employer must sponsor the candidate's visa, which is a matter for the employer and its immigration counsel.

How UCB can help

We form US LLCs and C-Corporations for recruiters outside the USA, get the EIN without an SSN, and help open a US business bank account without visiting, through our formation, EIN and bank account package. Each year we prepare Form 5472 with the pro forma 1120, Form 1120 or Form 1065, through our US tax filing service. We do not draft fee agreements, handle agency licences or advise on employment law.

Starting a recruitment agency for US clients? WhatsApp us at +1 315 961 2956 or email enquiries@ucbsolutions.com.