How to pay independent Cuban contractors
Paying independent Cuban developers, designers and consultants from a U.S. business or client under 31 CFR §515.582 — each contractor an independent entrepreneur under §515.340, on their own invoice, from a verified business account. Not employment, not payroll.
Who this is for: U.S. startups, agencies and individual clients contracting Cuban talent
A U.S. company or individual may pay an independent Cuban contractor: §515.582 authorizes transactions, including payments, necessary to import services produced by independent Cuban entrepreneurs — a self-employed professional, an independent contractor or consultant under §515.340(b). It does not authorize employing Cuban nationals in Cuba: a worker on a U.S. company's payroll is not supplying services produced by an independent entrepreneur. Pay the party you contracted with — an individual contractor on their own invoice, or a Cuban enterprise on its invoice after it is onboarded as an enterprise — never an enterprise invoice split across its staff, and never a lump sum to one person who redistributes. The payer passes KYB: each owner of 25% or more and the controlling person are identified (the CDD Rule standard QvaPay's program adopts), every owner is screened against the SDN List, and OFAC's 50 Percent Rule is applied.
Is it allowed? The legal authority
- Who sends
- A U.S. business with a verified account, or a U.S. individual client, paying independent Cuban contractors for their services — developers, designers, writers, consultants, sales agents, each with their own licence or registration and a statement of work (§515.340(b)) — one payment per contracted party, on its invoice, from the payer's own verified QvaPay account. Not employment: wages to an employee in Cuba are not within §515.582. Services are not subject to the State Department §515.582 List; the exclusions are goods-only.
- Who receives
- Independent Cuban entrepreneurs (§515.340) — self-employed licensees, freelancers and sole proprietors engaged directly; a MIPYME's own staff are paid through the MIPYME, on its invoice.
31 CFR §515.582 (payments necessary to import services produced by independent Cuban entrepreneurs — §515.340(b) independent contractors and consultants; not employment) · §515.421 (transactions ordinarily incident; OFAC FAQ 756).
KYB on the payer — each owner of 25% or more and the controlling person (the CDD Rule standard, adopted by QvaPay's program), every owner screened against the SDN List with OFAC's 50 Percent Rule applied; identity verification and independence evidence on every contractor; Sanctions Sentinel on payer and every contractor before release; purpose attestation on the funding; BSA recordkeeping at $3,000 and above, with all of one payer's payments reviewed together.
Only U.S. payers are shown as a permitted flow: a payment by a non-U.S. person to a Cuban national is not a CACR-licensed transaction, and with the U-turn license at §515.584(d) withdrawn (FAQ 1272) QvaPay may not process a transfer that begins and ends outside the United States.
Step by step
- 1Open a verified QvaPay business account (or verify yourself as an individual client): formation documents, EIN, each owner of 25% or more and the controlling person; every owner is screened against the SDN List and OFAC's 50 Percent Rule is applied.
- 2Add each contractor by name. Each one completes identity verification and provides independence evidence — a self-employment licence (TCP) or contractor registration — and a statement of work or service agreement (§515.340(b)).
- 3For each invoice, create one payment to the contracted party with the purpose Services; Sentinel re-screens payer and payee before release.
- 4Each payee receives QUSD and converts peer-to-peer with a verified peer.
- 5Export the payment records for your books and keep them ten years (31 CFR §501.601). QvaPay records the parties and amounts under the BSA recordkeeping rule and reviews all payments from one payer together; splitting payments to stay under thresholds is itself a red flag and may be reported.
See how QvaPay does itP2P leg terminates in Cuba
- No lump sum to a team lead who redistributes, and no enterprise invoice split across its staff — each contracted party is a named, verified payee, so each payment is traceable end to end.
- No Cuban bank, no state employment agency and no state enterprise in the chain; no employment relationship — contractors only (§515.340(b)).
- QvaPay never holds or moves pesos; the peso side is the trader's own money, already in Cuba.
The CUP/MLC side of a peer trade is settled between the two peers outside QvaPay — in cash or through the peer's own Cuban bank account. QvaPay does not hold, move, see or certify that leg; it records only the QUSD side. Peers trade their own funds, declare their activity, are limited in volume against it and are reviewed when they exceed it; a peer located in the United States may not trade on the market. Crypto funding is accepted only in USDC from screened wallet addresses; inflows from unhosted wallets receive source-of-funds review, and the same $3,000 recordkeeping applies.
Screened: KYB on the payer (formation documents, EIN, beneficial owners at 25% under the CDD Rule) plus the separate OFAC 50 Percent Rule check; identity verification and independence evidence (licence or registration, statement of work) on every contractor; payer and each contractor screened against SDN, the Cuba Restricted List and §515.337/338 on every payment.
Describes the example rail's design; not a determination that any transfer is authorized. The P2P leg, explained →
- ✓Payer's formation documents, EIN and beneficial-ownership declaration (or individual identity).
- ✓Statement of work or service agreement per contractor.
- ✓Contractor identity and independence evidence (TCP licence or contractor registration).
- ✕Put Cuban nationals in Cuba on a payroll — wages to an employee in Cuba are not a §515.582 import of an independent entrepreneur's services and have no general license.
- ✕Pay a team through one person who redistributes, or split a Cuban enterprise's invoice across its staff to avoid onboarding the enterprise — pay the party you contracted with.
- ✕Pay from outside the United States: a payment by a non-U.S. person to a Cuban national is not a transaction the CACR licenses, and since September 30, 2026 a U.S. platform may not process a transfer that begins and ends outside the United States (§515.584(d) withdrawn; OFAC FAQ 1272).
- ✕Contract a prohibited official or Party member (§515.337, §515.338), or a state enterprise's staff.
- ✕Try to route around these rules — split payments, use a conduit, pay through an unidentified third party. Such attempts are refused and may be reported as the Bank Secrecy Act requires (31 CFR §1022.320).
Common questions
Do I issue a 1099 to a Cuban contractor?+
Payments to foreign persons for services performed outside the United States are generally not 1099-reportable; collect a W-8BEN (individual) or W-8BEN-E (entity) and keep it on file; any work performed inside the United States is U.S.-source and may be reportable and withholdable. Confirm with your tax adviser.
Can I hire a Cuban as a full-time remote employee?+
Not through this lane. §515.582 covers services produced by independent entrepreneurs — self-employed, independent contractors and consultants under §515.340(b). An employment relationship with a Cuban national in Cuba is not within it; engage the person as an independent contractor with their own licence and invoice, or take counsel on a specific license.
Open QvaPay and follow the steps above. If you are a business, an exporter or an organization, write to us and we onboard you case by case.
QvaPay, Inc. is a FinCEN-registered money services business (MSB No. 31000329382692) providing payment services; it is not a bank. A QUSD balance is a payment obligation of QvaPay, Inc., held in the United States — not a bank deposit and not FDIC-insured. QvaPay forwards remittances under 31 CFR §515.572(a)(3) and processes authorized payments as transactions ordinarily incident under §515.421 (OFAC FAQ 756); the standing of balances held for persons in Cuba is among the questions put to OFAC in QvaPay's pending request for interpretive guidance (Case CU-2025-1426925-1).
This guide is general information, not legal advice and not a determination that any transaction is authorized. Rules change; the update date is above. Keep your own records for ten years (31 CFR §501.601).