> Malta rolled out a “nomad residence permit” late last year that allows non-European Union remote workers earning at least €2,700 ($2,755) a month to live on the Mediterranean island nation for up to a year. (Digital workers from elsewhere in the EU aren’t included in the program, as they don’t need a permit to work in Malta.) The Maltese government has since processed more than 400 applicants, the majority from the U.S. and the United Kingdom.
But, if you go to Malta and live there more than 6 months per year, and work as a software engineer, you will have to work for a company based on Malta... unless the company you are working for has a branch in Malta or is using an intermediate company to hire you. Same for any other country in Europe. Many think that "Oh, I'll work for a German company earning German money while working from a beach in Portugal". Well, that's definitely possible, but the vast majority of German companies hiring remotely: a) do not have a branch in Portugal, and b) do not use intermediate companies to hire talent. So, more often than not, if you want to work from Portugal more than 6 months per year your pool of companies to apply for will be mostly Portuguese ones.
Also, even if you think "oh well, then I'll work from Germany 6 months and 1 day per year, and from Portugal the rest of the year", that may not work for some companies. Some companies, allow you to work from abroad (within the EU) but for a maximum of 3 months (becaues of health insurance issues).
All of this applies if you are an employee. For contractors, that's different.
That's certainly true, but the vast majority of remote workers I know work as freelancers, which solves this completely and relatively easily.
It's no major hassle - you email a invoice once a month, add a line to a spreadsheet, and hire a English-speaking local accountant to do the filings (in Spain this costs ~€30 a month). In many cases you save money overall, since coworking, laptops, software tools and relevant SaaS subscriptions you might've paid for yourself are now all deductible business expenses (i.e. you pay 50+% less, after typical income tax + VAT).
The practical day to day is identical, since most remote-focused companies I've talked to have a standard policy of benefits (standard working hours, paid holiday, minimum notice periods, etc) for their remote freelancers abroad and for their local employees (notably though you can't be a freelancer locally in many countries, as it's considered disguised employment - employee if the company has a local presence, contractor otherwise). Of course, that's only true for companies who are comfortable with remote work, which ime is common for software dev & startups but rare elsewhere.
Your mileage may vary, but for me and many people I know across Europe it's an easy fix that's no big problem.
> coworking, laptops, software tools and relevant SaaS subscriptions you might've paid for yourself are now all deductible business expenses
That has also applied to those in USA not doing foreign nomad thing. In USA, an LLC keeps things tidy for the business expenses including conference travel.
>you will have to work for a company based on Malta...
I think that's what these residency permits and visas are designed to change. It specifies non-EU remote workers (read: Canadians and Americans) What you're describing sounds like it would likely apply to EU residents only - as a way of mitigating the complete free transfer of movement/labor it allows.
Isn’t the usual solution for this to just be a contractor? Everyone I know who remotes from a different country is just doing this. Maybe there’s some rules I don’t know
In Most countries of the EU (if not all), you are required to have more than one or two clients to legally be a contractor, otherwise you are a “fake employee.”
Modern Employer of Record services make all of this quite easy. There’s some additional cost, sure, but in my experience if you’re trying to hold on to talent it’s well worth it. As a bonus you avoid all the pitfalls of trying to pass off an employee as a contractor.
i do not believe that this is true. as a european citizen i have the right to live anywhere in the EU regardless if i even have a job or not. so the location of my employer should be irrelevant.
can anyone find actual laws to the contrary and evidence that they do not violate EU-law? a quick search by myself turned up nothing.
cross-border employment has been common for decades, so such a limitation would be very surprising.
what is possible is that employers may shy away from the resulting complexity because the employee needs to pay taxes in his country of residence, and not that of the employer.
Great site but they should have a star system or ranking or ratings. Some of the deals are really weak like $6100 value for moving to this city https://www.makemymove.com/get-paid/ponca-city-oklahoma where the incentives besides coworking are all unimportant.
I mean, there's small towns in every region of the US. I'm a little surprised that there's nothing in New England, because it's basically all small towns outside of the Boston metro and Worcester.
I think the term "nomad" is probably not applicable in this context given that those countries are offering longer-term residencies. In my view, digital nomadism is the idea of being to move around more often and setting up shop anywhere. It also usually promotes taking non-ecological means of transportation (i.e. planes) and can lead to the replacement of the local population with "digital nomads" renting on Airbnb.
> Many digital nomads are skilled knowledge workers who earn well beyond the €2,000-€3,500 monthly income requirements of most European digital visa programs—a big reason so many countries and towns are trying to lure them.
So, what gives as an European SW developer in this income bracket?
1. Go to US
2. Negotiate US salary
3. Come back to your native village, hopefully with "well beyond" money
4. Profit?
It's quite difficult as a European SW developer living in Europe to work for US companies. It's either one of these options:
1. US company has an office in EU, so you can work as an employee. Chances are the company is not paying you the US wages, but European ones... at this point, what's the benefit of working for the American company?
2. US company doesn't have an office in Europe. So either you work as a contractor for them (and that's a lot of hassle for a lot of people who are used to work as an employee) or the US company uses a third-party company to hire you as an employee (and that's a hassle for the US company, so many don't offer this)
3. US company is willing to hire contractors living in Europe... but then you have to be a contractor (personally, I don't like it) and you have to adapt to their TZ (personally, I don't want that).
As many have said before, in Europe the salaries for software engineers come in different "tracks". You have the usual 25K-40K-60K EUR/year for junior-medior-seniors, but you also have the 50K-80K-100K EUR/year (becoming more common at least in western europe), and the not unheard of 90K-120K EUR/year for seniors in some companies.
As someone in Western Europe working for a US company, the Timezone thing is the biggest issue for me. My company is actually really good with it, but I still often finish work at 7-8pm local time, sometimes with little notice. Everything else can be worked around, or smoothed out, but this is the biggest intractable pain.
I am an European and was making $170k at my latest remote US job. Still, the time zones difference made it not worth it. I don't want my work days to start at noon and end at 8 pm...
I've lived in Portugal pretty much my whole life and don't want to leave, working in software development for almost 10 years now. If I had left before 2019 and decided to return now, I would pay IRS taxes on 50% of my income for 5 years, and get access to an exclusive credit line.
If I was a foreign citizen and had never been to Portugal and I had a "profession of high cultural and economic worth", I could purchase a house here, register fiscally as a non-habitual resident, and also get a bunch of discounts on foreign income, national income, rent income, capital gains among other things.
This strikes me as quite unfair, not only for giving people who are in a better financial state all these benefits, but also by putting more pressure on the already inflationed housing market. The Golden Visa programme also "helped", along with many other things. Some of these benefits were or are in the process of being reduced, but many still remain.
I understand this grows our economy, in principle, but mostly seeing negative consequences on the lives of my mostly non-tech friends and family is hard to ignore...
It is what it is. It would be unfair if we (I'm Portuguese as well) were suddenly taxed at a higher rate than foreigners, but the truth is we've lived with higher taxes and lower wages for a long time. Anything that brings rich/skilled people into the country will be a good thing in the mid-to-long run.
As far as the housing market goes I've always seen blaming foreigners as a very convenient excuse. Truth is our market follows the price of mortgages and those haven't been this cheap ever. Blame your fellow countrymen whose parents can loan them 50K to get a foot in the door instead.
It is an excuse to blame the foreigners, agreed. These measures were not decided by them, I just think the government hasn't invested enough on affordable housing, and this helps.
About we not getting a tax raise... true, but we do have price indirect cost increases, mostly in housing. Right now most of my friends outside tech here in Lisbon are making ~800€ a month. That's around the cost for a tiny 1 bedroom within 45min of their workplace, a lot of them have to share a house with people they don't know.
Bringing skilled people is good, but will they be retained once time is up for the benefits? Is the government actually investing in high-tech or just picking up the scraps from foreign business?
If it’s any consolation, Rebase.co, a service that advises folks on moving to Portugal to take advantage of the NHR program, has been discouraging non-EEU citizens from doing this for a couple of months, citing https://www.linkedin.com/posts/tiago-cassiano-neves_pta-inte...
> I understand this grows our economy, in principle, but mostly seeing negative consequences on the lives of my mostly non-tech friends and family is hard to ignore...
Perhaps the positive consequences are just harder to see? If these people grow the economy, then everyone benefits to a degree.
Yeah if you are going to work for a US company with US salary, be prepared to take US "vacations". They'll look at you weird if you ever mention that you want to take three weeks off.
Minimum number of weeks in Sweden, Norway, Denmark and Finland is 5 weeks. Many employers are offering 6-8 as a perk. Since salaries are gutted by tax, other ways to compensate are used.
Why would a European SW developer need one of these visas for Europe? Also, I think plenty do make more than this, no? At least in Berlin I'm sure many of the people I worked with netted at least double this.
You won't get a visa to stay in NL beyond the default Schengen tourist visa. If you want permission to live in NL for longer, you'll have to apply for a residence permit.
If you're American, you can get a DAFT self-employment visa for about 2k EUR total (app fee plus various other professional services to set it up). But then you absolutely will be filing NL taxes and paying NL taxes. They are indeed very high compared to US. You will also still be filing US taxes, although you won't owe the US since you will have already paid more in NL.
I do not recommend NL for digital nomad who plan to stay longer than a "brief" visit of a month or two. If you're only staying a month or two, you're not a resident and won't have to bother with NL taxes.
Also, winter is dark and sucky, and summer is heaven except for the new brief periods of VERY HOT days. Keep in mind that most places do not have air conditioning.
For most tech workers in the US, there is no EU country where:
salary - EU taxes + Social Welfare Benefits > salary - US taxes - US healthcare - US retirement
My employer routinely sends me to Frankfurt/Brussels/Paris. There are no local engineers doing what I am doing who have a higher standard of living than I do-- and I'm only middle of the road here in the US.
Of course, the reality is completely different for almost every other career field but no amount of free healthcare makes up for the fact that I earn, at a minimum, 2x the amount an aerospace engineer in Paris does.
Also, the safety of the US is highly variable. In my area the gravest and most obscene crime that has occurred in the last five years was some teens spray painting "420 every day" on the dumpster behind the elementary school.
> salary - EU taxes + Social Welfare Benefits > salary - US taxes - US healthcare - US retirement
This is true if nothing really bad happens to you and your family ( car accident, really bad decease, ... ). France will have much better social security for tail risk.
This equation is not deterministic. It works on majority of cases, but having the peace of mind of feeling safe, is worth a lot to me.
Tail risk also compounds the bigger your family is. I am very grateful that my parent will have lifetime free Healthcare, hassle-free retirement, even though this comes at a 50% income tax + social security.
Ha, I was about to say this! My son mangled his foot goofing off on a playground doing things he shouldn’t have been doing. The hospital visit was €30 after fixing his foot (he’s already back to normal, FYI), plus since he’s under 18, he doesn’t cost anything on my health insurance.
Let’s also discuss the fact that if you live near any city, having a car is purely optional, and for less than €10 a month, you can get 40-50% off of public transportation costs through their subscriptions.
So sure, you may pay an extra 10k a year in taxes, but no car payment, insurance, or healthcare costs probably makes up that 10k very quickly, if not in cash, then in peace-of-mind.
I have kids and I live very peacefully in Silicon Valley. If you are a decent tech worker and have a job at a decent employer, you will get health insurance with a reasonable out-of-pocket maximum (mine is 6000USD for my entire family). That, combined with insurance premiums (around ~4800 for the whole year) is still only 11000USD per year, which is far more than the salary differential between Europe and the US.
In short, you don't have to worry about healthcare expenses as long as you are employed by a decent tech company.
Maximum out of pocket costs for me is €300~ish, and the premiums for my wife and I (kid is free) is €300 a month with worldwide coverage (we travel a lot). I receive Silicon Valley wages and live in Europe. My income taxes are around 25-28% depending on things.
I grew up and lived in the US for most of my life. The healthcare simply isn’t imaginable for most Americans. I don’t have to argue with insurance about whether or not a medication is covered, I don’t have to add an extra two hours to my hospital visit just to work out billing, getting an epi-pen doesn’t bankrupt me, and so much less hassle. I got into a motorcycle accident in the US. After really good insurance, it still cost me nearly 100k, my son cost 20k + a huge argument with insurance about the date of conception so they could get out of paying for it. That would have all been free here without any argument whatsoever.
I understand your denial, I was once the same way.
The tax difference is WAY more than 10k a year. I'm not even a FAANG level income person, and my taxes are almost double in NL.
But as the original question was just about paying taxes, I didn't provide pro/con reasons for living in NL. I chose to live in NL, and I love having good public transport. However, 40-50% discount is not a normal thing. Even so, if you can avoid owning a car, it's cheaper to use public transport. But if like me you live in a village, you still need a car. And car ownership is much more expensive in NL than US. Of course fuel is much more expensive too, but most of us drive very fuel efficent cars here.
All together, the best reasons for living in NL vs US are safety, availability of public transport, and relatively lower income inequality. You give up a lot of $$ for those benefits, but I think it's worth it.
Now, when the moron entitlist farmers protest because they want to be allowed to maximize profit at the cost of regional and global pollution, and the NL government bends over and takes it all, that irks me greatly. So not everything is perfect.
You do save money on dining out, though, because most restaurants have bland food with poor service; thus, it's better to eat at home or at a friend's.
It’s only a little higher than the US for taxes. But I was self-employed in the US, so I didn’t have an employer invisibly paying half my US taxes. If coming from a place of employment to the NL, a doubling of taxes would be normal?
For the car, it’s usually far cheaper to just rent a car for a few hours (SIXT ride share) or days vs owning one.
This essentially means that 30% of your income will not be taxed. This makes a huge difference! Unfortunately, it does not apply if you are self-employed. The 30% benefit also only lasts a few years. I believe the duration has been shortened in the last couple of years, and now has a maximum of 5 years. Stay longer, and you'll be paying proper Dutch level taxes.
As for the car, there are a few good hourly car sharing services. However, those aren't useful if you live in a village where no such cars are near.
I chose to stay in NL despite the high taxes because I found it to be a better quality of life compared to the US (or at least the places I had lived in the US).
The question wasn't about quality of life, it was about paying taxes. Thus, I only answered for that.
If you work for 90 days or less then nothing happens.
If you work for 91+ days then you don't maintain your US employment. You must find new employment in The Netherlands and get a work visa. That may mean staying at your current company and switching from the US based company to their NL based company, but it's still a new job. You'll pay taxes in the NL, but you may get a SIGNIFICANT discount for the first 5 years as an IT worker [0].
You will still need to pay taxes in the US, but you'll get a discount of any taxes already paid to the NL so, effectively, you won't need to actually pay any taxes since taxes are higher in the NL. You'll still file every year.
If there are treaties, then best case is you end up with a tax burden that is equal to whichever is higher. Treaties will usually let you claim credits for foreign taxes paid. Navigating how to apply for the treaty benefits will be a huge PITA though...
In the worst case you may end up being double taxed on some aspects of your income. Sometimes treaties don't credit you for all types of taxes paid and tax-deferred/advantaged investment accounts (retirement or otherwise) may also not be fully recognized across jurisdictions, making them not actually tax-deferred/advantaged.
Would be a large YMMV situation, though the silver lining is that figuring out how to navigate this would largely be a one-time cost.
Sadly in the US were taxed no matter where we live. We have agreements with a lot (most?) countries though so we get "credit" for taxes paid to the country we are living in.
The cost of living definitely balances things out. I just wish The Netherlands would change their stance on dual citizenship.
The alternative is to do a work visa and then resident visa until we're 65 and then we can "opt" for citizenship which does allow for dual citizenship. It's a much longer route though.
UK is just easier for multiple reasons but comes with it's own bag of worms.
They don't. Compare local purchasing power of any big European city with any American city. 9 out of 10 times, people in American cities would have higher purchasing power.
Even Alabama and Mississippi have higher tech average wages than countries like Germany and Netherlands. If you move out of central/western Europe, things only get worse.
This doesn't even talk about how much higher taxes in these countries are. You will be paying almost ~40% (tax and social security) for these salaries in Germany and Netherlands.
> They don't. Compare local purchasing power of any big European city with any American city. 9 out of 10 times, people in American cities would have higher purchasing power.
Doubt, especially once you factor things like paid vacations, paid parental leave, healthcare, etc.
The big difference is when you are an healthy young techbro, after that it equalize quite rapidly on average. Of course there are outliers but for the average software developer I'd say you're much better of in a European capital than in Alabama
Lifestyles are also completely different and can't be priced in
> Doubt, especially once you factor things like paid vacations, paid parental leave, healthcare, etc.
Your doubt is misplaced. Have been working in the valley for 15-20 years now. Between my partner and myself, we have seen close to ~10 companies. At almost all of those except for a tiny startup, we saw: good health insurance (with out-of-pocket maximums to cap your spend), 3-5 weeks of paid vacations per hear, 3-4 months of paid parental leave (for both parents), etc.
I know that the bottom quintile of the American society doesn't have it great. But if you have a tech job offer from a decent Silicon valley company (not tiny bootstrapped startups), the only thing you have to worry about would be your visa. Another tricky area would be housing and I say tricky only because personal preferences vary a lot there and your options also differ based on your family situation - partner working? kids? schools? like cars? hate cars?
It's even worse in big European cities. Lack of housing is a big issue. This means you have to move outside of the city and boom your life is car dependent now. You can try throwing money at it but at the end paying 2K for rent when you earn 3K(after taxes) isn't something you would be happy about.
> It's even worse in big European cities. Lack of housing is a big issue. This means you have to move outside of the city and boom your life is car dependent now.
None of my friends own a car, we all live in big European cities.
We all pay less than ~25% of our income for housing.
You can compare cost of living on numbeo. We are talking about tech workers here. Most of the tech employers offer quite generous benefit in USA including healthcare, generous parental leaves and vacations. Also 401K is so common among tech workers in US. Those kind of retirement scheme aren't very common in Europe. You are almost always dependent on the public pension which is generally quite low.
Almost everyone I have heard from who moved to US confirmed their bank balance got fatter. This is also true about people moving to Switzerland. Even with high costs in Switzerland, you make extra money and pay less taxes.
Everything else gets more expensive though, real estate, going out, eating out, you need a car for everything, &c.
You gain some and lose some, personally I would never go back to the US even if I got a 3x salary increase. Having lived in both the lifestyle difference is a deal breaker for me. And Im not talking about buttfuck nowhere USA, I'm talking about NYC, SF and Mountain View
For Canadian nomads: can't one just move to Malaysia/Jersey and not pay taxes after the tax residency kicks in? Taxes are ridiculous in Canada
I wish East Asia was more proactive with digital nomads. For example, Japan is notoriously tough to get in. Korea offers visas for Korean diaspora but not much for foreigners.
My dream would be remote working in Japan but they still rely on fax machines and stupidly outdated formal procedures, it was like living in the 90s, but I loved it while I was there shortly. Many foreigners I saw were working remotely but never reported it on their "tourist" visa. I wonder if this is sustainable.
That’s because virtually every country on earth only allows you to be an employee of a company with a local entity OR a contractor. Thus you are only “legally” allowed to work if your employer has an entity in that country and hires you from that entity. Otherwise, you MUST be a contractor.
One of my problems as a "digital nomad" is my income is not stable. Does that make me ineligible for such programs?
Also, for digital nomads with families, how do we get local rates for things such as children's medical fees, schools, etc.? If I'm living in a country on a tourist visa, can I even register for these sorts of things?
or in the case of Paris, extreme tax/socialist policies/reckless immigration creating uncivil environment. Seriously, very few places I find in Europe that is attractive now, lot of places in Asia have caught up or exceed in value.
But, if you go to Malta and live there more than 6 months per year, and work as a software engineer, you will have to work for a company based on Malta... unless the company you are working for has a branch in Malta or is using an intermediate company to hire you. Same for any other country in Europe. Many think that "Oh, I'll work for a German company earning German money while working from a beach in Portugal". Well, that's definitely possible, but the vast majority of German companies hiring remotely: a) do not have a branch in Portugal, and b) do not use intermediate companies to hire talent. So, more often than not, if you want to work from Portugal more than 6 months per year your pool of companies to apply for will be mostly Portuguese ones.
Also, even if you think "oh well, then I'll work from Germany 6 months and 1 day per year, and from Portugal the rest of the year", that may not work for some companies. Some companies, allow you to work from abroad (within the EU) but for a maximum of 3 months (becaues of health insurance issues).
All of this applies if you are an employee. For contractors, that's different.