Cost comparison
Hiring developers: Pakistan versus Australia
Most comparisons of offshore and local hiring compare the wrong numbers. They put an Australian salary next to an offshore monthly rate and declare a saving of seventy percent. That is not a like-for-like comparison, and any Australian founder who has actually run both models knows it.
This page does the comparison properly. It counts the on-costs that sit on top of an Australian salary, it counts the costs that sit on top of an offshore engagement, and it is explicit about where offshore does not work. We are a Pakistan-based company and we obviously have a position here. We have tried to write the page we would have wanted to read before making the decision.
The number most comparisons leave out
An Australian developer's salary is not what an Australian developer costs.
If you employ a mid-level developer in Sydney on a base salary, you are also paying superannuation, payroll tax once your wage bill crosses the state threshold, workers compensation insurance, and, if you used a recruiter, a one-off placement fee typically calculated as a percentage of first-year salary. You are also carrying paid annual leave, sick leave, and public holidays, which reduce the number of days actually worked without reducing the cost.
Then there is the cost that never appears on a spreadsheet: time to hire. Australian technical roles routinely take two to three months to fill. For a startup with a shipping deadline, that gap has a real price.
| Cost component | Basis | Indicative annual (AUD) |
|---|---|---|
| Base salary, mid-level developer | Seek Salary Guide 2025 | AUD 90,000–130,000 |
| Superannuation guarantee | 12% of ordinary time earnings (FY2025–26) | AUD 10,800–15,600 |
| Payroll tax | NSW 5.45% on wages above AUD 1.2M threshold | AUD 0–7,100 ¹ |
| Recruitment fee, amortised over year one | 15–20% of first-year salary | AUD 13,500–26,000 |
| Total year one | AUD 114,000–179,000 |
Indicative only. Rates vary by state, industry classification and wage bill. Equipment, software licences and desk costs excluded. ¹ Payroll tax applies only if your total annual wage bill exceeds the NSW threshold of AUD 1.2M (VIC: AUD 700K at 4.85%). Source: Seek Salary Guide 2025; NSW Revenue Office. Confirm with your accountant before budgeting.
The point of the table is not that the total is large. It is that the total is typically well above the base salary figure people plan around, and the gap is where budgets break.
What a Pakistan-based dedicated developer costs
Our published rate for a full-time dedicated developer is USD 3,000 to 10,000 per month depending on role and seniority, under a company-to-company service agreement. See our pricing page for the full rate breakdown. There is no superannuation, no payroll tax, no workers compensation, no recruitment fee, and no leave liability, because you are not the employer. You are buying a service from a registered company.
Costs that are real in the offshore model
- The monthly rate itself. No hidden loading, but confirm whether your quoted rate is full-time or part-time hours.
- Your own management time. This is the cost people underestimate. A dedicated offshore developer needs the same code review, the same specification quality, and the same standup attention as a local hire. If your team does not have the bandwidth to manage a person, offshore will not fix that.
- Onboarding ramp. Assume two to four weeks before output matches expectations, the same as any hire.
- International transfer fees and FX movement. Modest, but real if you are budgeting in AUD against a USD invoice.
- A slower feedback loop on ambiguous work. Four to five hours of daily overlap is enough for most engineering work. It is not enough for work that needs constant back-and-forth clarification.
| Australian employee | Pakistan-based dedicated developer | |
|---|---|---|
| Direct cost | AUD 114,000–179,000/year (see table above) | USD 4,000–6,000/month — indicative AUD 74,000–111,000/year ² |
| Superannuation | Applies | Not applicable |
| Payroll tax | Applies above threshold | Not applicable |
| Workers compensation | Applies | Not applicable |
| Recruitment fee | Typically applies | Not applicable |
| Paid leave liability | Applies | Not applicable |
| Time to productive | 8–12 weeks to hire, plus ramp | 7 business days to onboard, plus ramp |
| Notice to exit | Per contract and Fair Work | 30 days |
² USD rates from our pricing page. AUD equivalent is indicative only, calculated at prevailing exchange rates. Invoiced in USD or in AUD by arrangement.
Where offshore genuinely does not work
We would rather lose a badly matched enquiry than take it. Offshore is the wrong answer in these situations:
You need someone in the room.
Hardware, lab work, physical site access, or a role that is genuinely half engineering and half sitting with the sales team. Remote does not solve this and neither do we.
You have no technical management capacity at all.
A dedicated developer needs someone to review their work and unblock them. If nobody on your side can do that, you do not need a developer, you need a delivery partner running a scoped project, which is a different engagement.
Your data cannot leave Australia.
Some government, health and financial workloads carry data residency requirements that rule out offshore processing regardless of contract terms. Check before you scope. If your obligation is data residency rather than data handling, we will tell you it is not a fit.
You need four hours of unscheduled, same-timezone responsiveness every day.
Incident response for an Australian-hours production system is a real constraint. There is genuine overlap between Pakistan and Australian mornings, but it is a window, not a full day.
You are hiring for culture and long-term equity.
A founding engineer who will still be there in five years, holding equity and shaping the company, is a local hire. Staff augmentation is not a substitute for a founding team.
Timezone, in specifics
Pakistan Standard Time is UTC+5. Australian eastern time is UTC+10 in winter and UTC+11 during daylight saving.
| Australian cities | Local zone | Offset from PKT | Practical daily overlap |
|---|---|---|---|
| Sydney, Melbourne, Brisbane, Canberra, Hobart | AEST / AEDT (UTC+10 / +11) | 5 to 6 hours ahead | 9am to 2pm local, 4am to 9am PKT |
| Adelaide, Darwin | ACST / ACDT (UTC+9:30 / +10:30) | 4.5 to 5.5 hours ahead | 9am to 2:30pm local |
| Perth | AWST (UTC+8) | 3 hours ahead | 9am to 4pm local, widest overlap in the country |
Note that Brisbane, Perth, Darwin and most of Queensland do not observe daylight saving, so the overlap for those cities is stable year-round while Sydney and Melbourne shift by an hour in October and April.
Our team works afternoon PKT hours specifically to cover the Australian morning. Work that happens outside the overlap is delivered async, which means the practical pattern for an Australian client is: standup in your morning, work continues after you log off, progress waiting when you start the next day.
Contractor, freelancer, or company contract
The offshore decision is usually framed as offshore versus local. The more consequential decision is the contract structure.
| Freelance marketplace | Individual offshore contractor | Company service agreement | |
|---|---|---|---|
| Who you contract with | Platform, then individual | Individual | Registered company |
| IP assignment | Platform terms, varies | Depends entirely on your contract | Full assignment, written into the agreement |
| If the person leaves | You restart | You restart | The company replaces them |
| Escalation path | Platform dispute process | None | Named account contact |
| NDA | Sometimes | Depends on enforceability in their jurisdiction | Company-to-company, mutual |
| Invoicing | Platform | Individual, often a compliance question | Company invoice, standard B2B treatment |
Codalyst Tech operates the third model. Every engagement runs under one company-to-company service agreement covering NDA, full IP assignment, data protection and escalation. You contract with CODALYST TECH (SMC-PRIVATE) LIMITED, a registered Pakistani company, not with an individual.
For Australian businesses this also simplifies the tax and compliance question. You are procuring a service from an overseas supplier, which is a well-established treatment, rather than trying to work out whether an individual offshore contractor creates an employment or contractor characterisation problem. Confirm the treatment with your accountant, but it is a materially simpler conversation.
A more honest way to decide
If you are comparing on cost alone you will pick offshore, and cost alone is a bad reason. Three questions that predict the outcome better:
Can you write a clear specification?
Offshore delivery amplifies specification quality in both directions. Good briefs produce good output faster than you expect. Vague briefs produce expensive rework.
Do you have a technical reviewer?
Someone who will actually read the pull requests. If not, buy a scoped project instead of a person.
Is the work overlap-tolerant?
Feature development, platform maintenance, data work and migrations: yes. Live incident response for Australian trading hours: harder.
If all three are yes, offshore staff augmentation usually works. If any is no, fix that first, or engage differently.
What we would suggest
If you want a person: Hire a dedicated developer for your city. See how our engagements are structured. Onboarding runs seven business days after documents are finalised.
If you want a project delivered to a fixed scope and price: Browse services or get a free estimate. Written proposal within 24 hours.
If you are not sure which: send the brief. We will tell you which model fits, including if the answer is that you should hire locally.
Frequently asked questions
- Is it cheaper to hire a developer in Pakistan than in Australia?
- Yes, substantially, and the gap is wider than the headline salary comparison suggests because an Australian employee also carries superannuation, payroll tax, workers compensation, leave liability and typically a recruitment fee. The relevant question is not whether it is cheaper but whether your work is suited to a distributed team. Where it is, the saving is real. Where it is not, the saving evaporates in rework and management overhead.
- How many hours per day will a Pakistan-based developer overlap with my Australian team?
- Pakistan Standard Time is UTC+5. Eastern Australian cities get roughly four to five hours of live overlap, typically 9am to 2pm local. Perth gets the widest overlap in the country at around six to seven hours because AWST is only three hours ahead of PKT. Work outside the overlap is delivered async with written updates.
- Do I need to worry about superannuation or payroll tax for an offshore developer?
- No. You are procuring a service from an overseas company under a service agreement, not employing an individual, so superannuation guarantee and payroll tax obligations do not arise on that spend. Confirm the treatment with your accountant, particularly around GST on imported services, as the answer depends on your registration and turnover.
- Who owns the code an offshore developer writes?
- Under our service agreement, you do, immediately and in full. IP assignment is written into the contract rather than left to platform terms or an individual contractor's jurisdiction. This is one of the practical differences between a company agreement and a freelance marketplace engagement, and it is worth checking carefully in any offshore arrangement you are considering.
- When should an Australian business not hire offshore?
- When the role requires physical presence, when your data carries an Australian residency requirement, when you have no capacity to technically review the work, when you need unscheduled same-timezone responsiveness through the full Australian business day, or when you are hiring a long-term founding engineer rather than adding delivery capacity. We would rather say so upfront than take an engagement that will not work.
Still deciding? Let us help.
Send us a message and we will give you an honest assessment of the right approach for your situation, including if the answer is that you should hire locally.