How to Budget for an Offshore Hire in 2027: A Planning Guide for AU & NZ Owners

Nick O'Connell

October 28, 2026

In short

Budget an offshore hire as six core lines: a one-time placement fee, monthly salary, the flat $400 monthly management fee, software, the Philippine 13th month pay and a pay-review buffer. For an A$1,400 admin role, year one comes to about A$24,200 before the placement fee, about 26% of our modelled local equivalent, and a 7.2% pay rise in year two adds about A$1,300. Philippine inflation reached 7.2% in September 2026 while WTW projects 5.1% pay rises for 2027, so plan a review and hold a reserve of about 10%. Pear Tree places vetted Filipino and South African professionals for a one-time placement fee plus a flat $400 monthly management fee per hire, and this is general information, not legal advice.

How should an Australian or New Zealand business budget for an offshore hire in 2027?

Budget it as six core lines: a one-time placement fee, monthly salary, the flat $400 monthly management fee, software, the Philippine 13th month pay and a pay-review buffer. For an A$1,400 admin role, year one comes to about A$24,200 before the placement fee, and a 7.2% pay rise in year two adds about A$1,300.

This guide is for owners and managers planning next year's headcount budget. The numbers are illustrations built on our cost model, not forecasts or quotes, and this is general information, not legal advice.

What belongs in an offshore hire budget?

Eight lines, including a few that are not cash. Table 1 lists them with when each one hits and what to check.

Table 1: The lines in an offshore hire budget
Budget line	When it hits	How to budget it	What to check
Placement fee	Once, at hire	Hold it as its own hiring-budget line; the amount is confirmed at hire, not published	Ask for it in writing before you commit
Monthly salary	Monthly	Quoted monthly rate x 12	How and when the rate is reviewed
Management fee	Monthly, flat $400 per hire	$4,800 a year (AUD or NZD); no percentage markup on salary	That it is flat and does not rise with salary
13th month pay (Philippines)	By 24 December	One month of basic pay for a full year (annual basic pay divided by 12), pro-rated for part years and leavers	Whether your quoted rate already includes it
Software seats	Annual	About $1,200 a year per hire in our model	Your actual stack, not ours
Equipment	Start-up	The offshore professional normally supplies their own machine, so hold only a small allowance for peripherals if you want one	Security requirements such as VPN and two-factor authentication
Pay review and contingency	Annual	About 10% of year-one cost in our judgement, covering a review above the survey average and a slower first month	Inflation, survey data and your tolerance for variance
Your management time	Ongoing	Not a cash line, and the same as for a local hire	Onboarding time in the first month

Source: Pear Tree cost model and pricing; 13th month pay per Presidential Decree 851 and DOLE guidelines (employer report to DOLE by 15 January). Our model treats 13th month pay separately because the published rates do not say whether it is included. General information, not legal advice.

The two lines that most often go missing are the 13th month pay and the placement fee. The first is a Philippine statutory requirement due by 24 December, and the second is a one-off that belongs in the hiring budget rather than the monthly run rate. Pear Tree's model is a one-time placement fee plus a flat $400 monthly management fee per hire, with no percentage markup on salary, so the fee does not grow when the salary does.

What does the first year cost?

About A$24,200 for an admin role at A$1,400 a month, including the 13th month, and about 26% of the local equivalent in our model. Table 2 works through four roles, using the same cost model as our total cost of ownership guide.

Table 2: Year-one cash budget for an offshore hire, excluding the placement fee
Role and monthly rate	Salary (12 months)	Management fee (12 x $400)	Software	13th month pay	Year-one total	Local equivalent, year one (our model)
AU admin/VA (A$1,400 a month)	A$16,800	A$4,800	A$1,200	A$1,400	A$24,200	A$93,242 (26% as much offshore)
AU EA-tier or claims admin (A$1,700 a month)	A$20,400	A$4,800	A$1,200	A$1,700	A$28,100	A$106,953 (26% as much offshore)
AU full-stack developer (A$2,800 a month)	A$33,600	A$4,800	A$1,200	A$2,800	A$42,400	A$175,505 (24% as much offshore)
NZ admin/VA (NZ$1,525 a month)	NZ$18,300	NZ$4,800	NZ$1,200	NZ$1,525	NZ$25,825	NZ$74,135 (35% as much offshore)

Source: Pear Tree cost model 2026. The local figures are for an Australian salary of A$60,000, A$70,000 and A$120,000 and a New Zealand salary of NZ$55,000, and include superannuation at 12% (Australia) or KiwiSaver at 3.5% and the ACC work levy at 0.2% (New Zealand), payroll tax above the threshold (Australia only), workers' compensation at 1% (Australia), a desk, equipment and an 18% recruitment fee in year one. The offshore figures exclude the one-time placement fee, which is confirmed at hire, and your own management time. Salary growth and currency movements are ignored.

Two cautions apply. First, the local column is our model for a business above the payroll tax threshold with a desk, so a small business without a desk would see a smaller gap, and the local figure includes an 18% recruitment fee while the offshore figure excludes the placement fee. Second, the model leaves out your own management time, which is the same for an offshore or a local hire, and a ramp-up period, which we handle by discounting offshore productivity by 10% in per-hour comparisons.

What could move the number in 2027?

Mainly Philippine inflation, pay reviews and currency, none of which a flat monthly rate fully protects you from. Philippine inflation reached 7.2% in September 2026, up from 6.1% in August, with transport costs up 14.6% and core inflation at 4.7%, against a 2% to 4% target range. WTW's July 2026 survey of 408 Philippine organisations projects average salary increases of 5.1% in 2027, against 5% this year.

That gap matters for a hire's real income. If inflation stays above pay rises, your offshore professional is getting poorer in real terms, and that pressure tends to show up as a resignation. The sensible response is to plan a review rather than hope to avoid one. Table 3 shows what three review outcomes do to the admin role in year two.

Table 3: What a pay review does to year-two cost for an A$1,400 admin hire
Scenario	New monthly rate	Year-two total (incl. 13th month)	Increase on year one
No pay rise	A$1,400	A$24,200	A$0
Average projected 2027 rise in the Philippines (WTW): 5.1%	A$1,471	A$25,128	A$928
Rise matching September 2026 inflation: 7.2%	A$1,501	A$25,510	A$1,310

Source: Pear Tree calculation; WTW Salary Budget Planning Report (reported by The Philippine Star, 21 July 2026; 408 Philippine organisations); Philippine Statistics Authority inflation (via Trading Economics, 6 October 2026). Year-one total is A$24,200. The management fee and software are held flat, the pay rise applies to the monthly rate and the 13th month, and the placement fee is excluded. These are illustrations, not forecasts or Pear Tree policy; the survey covers Philippine employers generally, not remote roles for foreign employers.

Even a rise that matches inflation adds about A$1,300 a year, which is small against the cost of replacing someone. Our retention rate is 90% against about 60% for the industry average, and fair pay is a large part of why.

Minimum wage changes mostly touch entry-level roles. Metro Manila's floor rose to PHP 755 a day on 26 September 2026, and a second step to PHP 780 on 20 January 2027 under an earlier order is caught up in litigation, so we treat it as unconfirmed. A professional on A$1,400 a month earns far above the floor, but the 13th month base, social contributions and any entry-level pay bands move with it.

How does currency affect the budget?

It depends on how your rate is set, so ask. If your rate is fixed in Australian or New Zealand dollars, a weaker peso raises your hire's pay in pesos and does not change your bill. During 2026 the Australian dollar ranged from about 39.3 pesos on 1 January to about 45.3 on 7 September, and stood at about 43.5 on 2 October, according to exchange-rates.org. On those rates A$1,400 is worth between about PHP 55,000 and PHP 63,000 a month.

The risk runs the other way if the Australian dollar falls. Ask whether the rate is fixed for the term, how and when it is reviewed, and who carries currency movements. We have not researched South African 2027 pay norms or the rand, so confirm those separately if you are hiring there, where our rates are the same as in the Philippines.

How much contingency should you hold?

Our rule of thumb is about 10% of year-one cost, or roughly A$2,400 on the admin role. That covers a pay review above the 5.1% survey average, a slower first month and small items that never make a line. It is our judgement rather than a published standard, so adjust it to your own tolerance for variance.

Also keep the replacement guarantee in mind. Pear Tree backs each placement with a six-month replacement guarantee at no additional cost, so a resignation in that window does not trigger a fresh placement budget, but ask any provider what happens after the guarantee ends.

How do you compare the budget with hiring locally?

Use the same lines on both sides and say what is excluded. On our model an Australian admin hire costs about A$93,242 in year one once super at 12%, payroll tax, workers' compensation, a desk, equipment and an 18% recruitment fee are included, against about A$24,200 offshore. New Zealand's gap is smaller, at about NZ$74,135 against NZ$25,825, because there is no payroll tax and ACC levies are low.

Local costs also change in 2027. KiwiSaver's employer default rises from 3.5% to 4% on 1 April 2028, and Australia's national minimum wage ($26.44 an hour from 1 July 2026) is reviewed again from July 2027. Neither changes an offshore budget directly, but both move the local comparison.

The bottom line for Australian and New Zealand owners

Budget an offshore hire like any other: every line, a review and a reserve. Pear Tree, with offices in Sydney, Auckland, Hawke's Bay, Cebu, Manila and Cape Town, has placed talent with 750+ Australian and New Zealand businesses, so ask us or any provider for the placement fee, the 13th month treatment and the review terms in writing before you sign.

Frequently asked questions

How much should I budget for an offshore hire in 2027?

For an Australian admin role at A$1,400 a month, budget about A$24,200 in year one, made up of A$16,800 in salary, A$4,800 in management fees, A$1,200 of software and A$1,400 of 13th month pay, plus a one-time placement fee confirmed at hire. Add a reserve of about 10%, or roughly A$2,400, for a pay review and a slower first month. These are illustrations from our cost model, not a quote.

Is the Philippine 13th month pay included in the monthly rate?

Check this with your provider in writing, because quoted monthly rates do not always say. The 13th month pay is a statutory payment of one month's basic pay for a full year, due by 24 December and pro-rated for part years. We show it as a separate budget line so it cannot be missed. This is general information, not legal advice.

Should I budget for a pay rise for my offshore hire in 2027?

Yes, plan a review. Philippine inflation reached 7.2% in September 2026, while WTW projects average salary increases of 5.1% for 2027, so pay that stands still loses real value. For an A$1,400 admin role, a 5.1% rise adds about A$928 in year two and a rise matching inflation adds about A$1,310.

Does currency movement change what I pay for an offshore hire?

It depends on how your rate is set. If it is fixed in Australian or New Zealand dollars, a weaker peso raises your hire's pay in pesos and does not change your bill, and the risk runs the other way if your dollar falls. During 2026 the Australian dollar ranged from about 39.3 to about 45.3 pesos. Ask whether the rate is fixed for the term and how it is reviewed.

Does the flat $400 monthly management fee change with salary?

No. Pear Tree charges a one-time placement fee plus a flat $400 monthly management fee per hire, with no percentage markup on salary, so the fee stays at $4,800 a year whether the salary is A$1,400 or A$2,800 a month. The placement fee is confirmed at hire, so ask for it in writing.

About the author

Nick, Co-Founder of Pear Tree, leads sales, partnerships and business development. Pear Tree connects Australian and New Zealand businesses directly with vetted offshore professionals from the Philippines and South Africa, with no agency middleman.