With a huge increase in companies operating remotely over the last few years, the importance of proximity to the office is becoming a thing of the past. Without the need to attend a physical workplace, many workers are reconsidering their ideal location to work from, and for many that ideal location isn’t even within the same country as their employer.
But what are the rules around working remotely from another country? This guide walks you through five questions to ask yourself when considering relocating abroad.
It certainly can be, but this question is complicated as the requirements depend on your situation and vary greatly from country to country. If you’re a US citizen traveling abroad, for example, some countries will enable you to work for your employer on a tourist visa, while other countries might require a different type of visa.
If you’re considering working from abroad, it’s a good idea to get some expert advice on your situation to make sure you comply with the local laws in the jurisdiction you’re traveling to. Check out our guide to paying tax as a digital nomad to find out more about tackling the complications of working while abroad.
If you’re already a tax resident in one country and looking to work for an employer that operates in another country–like if you're returning to your country of residence because your work visa has expired, for example–the legal complexities can be handled for you with global employment software like Oyster. Find out more about how Oyster handles the complexities of cross-border employment.
If you’re planning on working remotely while you travel, don’t just rely on tourist visas–you could end up being detained or deported if the local authorities find you violating the terms of the visa you’re traveling on. There’s no universal visa rule for every country in the world. Some countries might allow you to work on a tourist visa if the scope of your work is limited to your country of residence, for example, while others might take a harsher approach, even if you’re not interacting with the local workforce. Always do your research before you travel and seek legal advice if you’re unsure.
Some countries have created special ‘digital nomad visas’ in an attempt to lure this new category of working tourist. For example, Antigua and Barbuda has introduced a Nomad Digital Resident visa designed for people who are not a resident and offering people, “the opportunity to work away from their homeland, while in the safety of a warm tropical island.” Alongside Antigua and Barbuda, many other countries offer similar visas. Take a look at this list of countries offering ‘digital nomad visas’ to find out more.
Tax is often the most confusing and stressful aspect of working remotely abroad as, like visas, different countries have very different tax laws. One thing is certain: no matter where you are in the world, if you’re employed and receiving a salary then you will be required to pay tax in some shape or form.
For the most part, your tax obligations depend on where you are a resident. So if you're a resident in the UK, for example, but living temporarily as a digital nomad in Italy, you likely will have to pay tax in the UK. This can get complicated if you additionally begin making gains in the country you’re not resident in.
In some countries, you could also become liable for ‘double taxation’, for example, if you’re registered as a resident in two countries at the same time, or if the country taxes individuals based on worldwide income. Some countries have double taxation agreements to ensure an individual’s income doesn’t get taxed twice, but before you work from another country it’s a good idea to check this out with an international tax expert. If you're already in the country, a visit to the local tax office can help to set the record straight.
In the early stages of your plans to work abroad you should talk to your employer, or clients if you’re self-employed, to get a sense of how willing they are for you to work from another country. There are some significant compliance challenges companies face when employees or contractors work from foreign countries that could leave them open to paying taxes in those countries. Permanent establishment risk is another common concern of many companies in this situation; however, there are easy ways to mitigate these problems and put your employer’s mind at ease.
Oyster is on a mission to enable companies to find talented workers, regardless of where they are in the world. If you’re resident in one country, and the company you work for is in another, then Oyster can help everyone handle the compliance and tax issues around cross-border employment. Find out more about how Oyster handles the complexities of global employment.
Disclaimer: This blog and all information in it is provided for general informational purposes only. It does not, and is not intended to, constitute legal or tax advice. You should consult with a qualified legal or tax professional for advice regarding any legal or tax matter and prior to acting (or refraining from acting) on the basis of any information provided on this website.
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