Budgeting for International Projects
"What's your budget?" is a key question whether your project takes place in the U.S. or overseas. From exchange rates and foreign taxes to legal advice and insurance, you'll want to ensure your program's budget accounts for costs that are rarely a part of domestic projects.
You can start by:
- Reviewing the unique line items for international projects.
- Contacting us for assistance estimating the costs applicable to your program.
9 International Budgeting Considerations
Program budgets are in U.S. dollars, but many transactions occur in local currency. Review exchange rates often so that you are aware of and can prepare for the impact of significant fluctuations and consider revising your budget closer to award stage or implementation. If you're receiving a donation or funding from a non-U.S. source, clarify whether the amount will be calculated in U.S. or foreign currency.
You may need to calculate salaries and fringe based on the local market rather than the typical Harvard salary grades and fringe rates. Depending on your staffing plan, your project may also incur staffing costs beyond employees' base salary and fringe benefits. These costs could be more than the salary of your staff, so it's important to budget accordingly and plan for these assumptions. Review our international employment guidance for options and budget implications.
Import and Export Duties
If you're shipping or hand-carrying technology, information, currency, or tangible goods across borders, you may incur duties and customs brokerage fees. Review our export and import guidance for more information.
Overseas activities may need additional—and sometimes local—insurance coverage. For example, most countries have mandates regarding insurance coverage for vehicles. Learn more about commonly required insurance policies.
Legal and Professional Services Fees
Many international programs require in-country legal counsel or other professional services, especially if you're not working with a local partner. You may have consulting expenses during the set up phase (e.g. researching local tax requirements) as well as ongoing expenses (e.g. paying an accounting firm to manage these requirements throughout the life of the project).
Depending on your location, you may need to budget for physical security for lodging and office locations, transportation and travel security, and access to medical care. Review our safety and security guidance for more information.
Although Harvard is tax-exempt in the U.S., this exemption doesn’t automatically carry over to foreign jurisdictions. Program revenue, donations, payments, and international fund transfers may be taxed, and rates of 25 to 35 percent are not uncommon. Learn more about common international taxes.
Ensure you've planned enough trips to allow for appropriate oversight, especially if you’re managing the project from the U.S. Consider the usual travel expenses (e.g. flights and hotels), and those unique to international travel (e.g. immigration fees and vaccines).
When operating in a less familiar location, unexpected costs are practically a guarantee. While you may be able to plan for foreseeable events that can cause program disruption (e.g. weather patterns and political elections), you also need to be mindful of unpredictable costs (e.g. emergency funds for disasters or attacks). If allowed by your funding source, have a contingency budget for these less foreseeable events. If it's not allowable, be prepared to draw on other unrestricted funds or potentially revise the program activities to stay within your original budget.
We can help you plan for and estimate the costs applicable to your program. Contact us.