Does the phrase “digital nomad” sound familiar? Maybe you’ve already heard about them? They’re remote workers who can set up an office and work from anywhere they please.
Because COVID-19 has made remote work a reality for millions of professionals, thousands of companies are making the choice to maintain a remote workforce. In the tech sector alone, Velocity Global’s 2022 Work in Progress Report found that, out of 1,000 companies from the United States and the United Kingdom, 72% plan to maintain an entirely remote workforce after 2021.
Due to this shift to remote work, a wave of tech-minded, freedom-loving digital nomads who travel to different cities and bucket list locations have embraced work outside of traditional offices.
To accommodate this lifestyle, digital nomads must understand and comply with specific work regulations to ensure their lifestyle isn’t interrupted. That’s where the digital nomad visa comes in.
Do You Need a Digital Nomad Visa to Work Remotely?
The short answer is yes and no. If you’re working remotely in your home country, a digital nomad visa isn’t required. But if you’re planning on working abroad for a longer period of time, you’ll need a digital nomad visa to remain compliant.
According to the European Union (EU), countries usually consider an individual a tax-resident if they have spent six months or more within their borders. Once deemed a tax-resident, the person must report earnings and adhere to the local country’s tax regulations.
So while digital nomads can enter a country with a tourist visa, doing so can make it illegal to work or gain income during their visit. On the other hand, digital nomad visas are designed for individuals who want to work in other countries and stay up to six months or a year.
Since COVID-19 has caused a work-from-anywhere (WFA) trend among workers everywhere, countries have developed these special visas specifically for remote work. The best part? These visas are designed to be easier to obtain, involving less bureaucratic processes or costs depending on the regulations of each country or region.
How to Get a Digital Nomad Visa
Along with flexibility and competitive pay, what’s making this rise of the digital nomad possible is a low barrier of entry to obtain a visa and work abroad.
As Forbes reports, most countries just ask visa applicants to show that they can earn a consistent income of $2,000 or more per month and are willing to stay in a country or region for up to one year, with the option for renewal.
The requirements, processes, fees, and costs for getting a digital nomad visa are different from country to country. Typically, the person must apply for the visa with a valid passport and pay an initial travel fee (often ranging between $1,500–2,000).
However, some countries have very specific requests around digital nomad visas that shouldn’t be glossed over.
Nomad 101: Compliance Issues When Working Abroad
While some countries might treat digital nomads like extended tourists, it’s still necessary to remain compliant with the local country’s visa requirements.
These rules vary, but most immigration departments will require that you have proof of residence or proof of employment. Others will want to see that a certain amount of business was conducted during your visit, including earning a specific amount of income, taking steps to open a business, or reporting taxes.
In Germany, for instance, you must apply with the local tax office, then submit a resume, cover letter, and other work-specific documents to show your intent to work while living there.
Six Countries With a Digital Nomad Visa
So far, more than 24 countries offer digital nomad visas, allowing extended stays for professionals conducting business elsewhere around the globe.
These countries include many island nations dependent on tourism, like the Bahamas and Cayman Islands. Now, more European countries have begun to hop on board with Spain announcing that it will soon offer a nomad visa.
Here’s a list of six countries that provide digital nomad visas along with some of their compliance takeaways.
1. Costa Rica Digital Nomad Visa
A perfect climate, lovely beaches, and inexpensive lodging make this a digital nomad paradise. The only downside might be its two-year work requirement and proof of $2,500 in income or a $60,000 deposit into a local bank.
2. Germany Freelance Visa
As a country of the EU, living off the Euro in Germany makes it a tad more expensive than other places, but the delicious beer, energetic culture, and rich history can make up for that. The biggest nuisance is all the proof-of-work documents required to earn a German Freelance Visa (aka German digital nomad visa).
3. Estonia Digital Nomad Visa
Estonia, another EU country, makes up for its higher cost of living with beautiful old-world architecture and a slow pace of life. You’ll need to have health insurance, make more than $3,000 per month, and pass a background check.
4. Portugal Digital Nomad Visa
Getting a visa is more expensive in certain countries, but not in Portugal. This lovely EU country, which is steeped in natural beauty, wondrous architecture, and rich culture, requests low permit fees. It also requires standard proof of identification, income, and work qualifications.
5. Spain Digital Nomad Visa
Although Spain recently introduced its Digital Nomad Visa, it will likely share some of the same requirements and benefits of other EU countries, like Germany and Estonia. Just prepare your travel budget for plenty of adventures in nature, nightlife, and new cuisine, like the delicious-but-unofficial national dish, Paella.
6. Thailand Digital Nomad Visa
Thailand doesn’t have a Digital Nomad Visa, but it is one of the most affordable nomad hotspots for westerners. To comply here, you must get a SMART Visa, which was built to attract remote talent and requires similar steps to getting a nomad visa.
Velocity Global Enables Digital Nomads to WFA
While many companies still haven’t embraced the digital nomad concept, this rapid evolution of how we work isn’t slowing down. Fortunately, Velocity Global’s Global Work Platform is helping businesses and talent see the possibilities of creating a digital nomad workforce.
Using cloud-based technology, our all-in-one software allows companies to easily engage their distributed team through an online platform, complete with HR, payroll, benefits, and more. Talk to us today to learn how Velocity Global harnesses innovative solutions that enable employers and talent to hire and work from anywhere.