Comment by absqueued | Hacker News Reader

Comment by absqueued | Hacker News Reader

I recently looked into the Rust Foundation’s 2023 IRS Form 990, and something caught my attention:

  - The Executive Director was paid £261,151 GBP (~$332,445 USD).

  - The Head of Finance & Funding received £113,977 GBP ($145,092 USD) + £10,362 GBP ($13,190 USD) in retirement benefits.

  - These salaries weren’t paid directly by the Rust Foundation (a US nonprofit) but instead routed through a UK-based entity, Rust Inc Limited, which is labeled as a “foreign subsidiary.”

Questions I Have:

Why is a nonprofit paying six-figure salaries through foreign subsidiaries instead of directly?

Is this common among tech nonprofits, or is Rust Foundation’s approach unusual?

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I’m not accusing them of wrongdoing, but does this raises ̶s̶e̶r̶i̶o̶u̶s̶ some questions about nonprofit governance, transparency?

If anyone has insight into why this structure exists or how other open-source foundations handle executive pay, I’d love to hear your thoughts!

Both of those officers appear to be located in the UK. It is common to pay people located in a different place than the company HQ using a local entity. Whether this is mandatory or merely advantageous for tax or bureaucratic reasons depends on the situation.

Excellent answer. I'd like to add that this is common enough that there are about 50 service providers that do it.

If you're Carlsberg and have one single salesperson in a country, these companies let you have a regular employment contact without your own subsidiary. Or you're the UN. Or...

Your addition pretty much does explain. Thank you.

Foundation's 990 (page 8) initially mentions paying 0 for full time work, only later to be explained in supplemental information page that there were in fact paid well high enough.

This could be simply payment structure like you said but their overal financial summary doesn't explain weather this was included in thecost of admin or not.

Page 7 of Form 990 asks for "highest paid employee." including other info where Rust foundation has reported 0 for most people.

Did you look into where the Executive Director and the Head of Finance & Funding live? (Cardiff, Wales and Oxford, England, respectively.)

What speicifc serious questions does it raise without any wrongdoing assumptions?

Wording, I could have written "some" question, not serious.

It raises questions about transparency, and why a U.S. nonprofit is routing executive salaries through a foreign subsidiary instead of paying them directly.

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