- People's attempts to hide their remote lifestyle are mostly laughable. You don't need sophisticated tooling to know that someone isn't where they say. I see you every day. I can recognize patterns. I can see the changes in work hours, response times and just general behavior. I can tell when you have just rolled out of bed with a coffee or come back from the club.
- Most managers I know don't give a shit. In fact we'd rather not know at all. It's really HR you have to worry about (and I'm not going to tell them unless you give me a reason to).
- HR itself only cares because of the tax implications. Inter-state taxes are bad enough, figuring out international ones are basically impossible. The company can get into major trouble if they are not following local employment laws, and "I didn't know my employee lived there" isn't a good enough defense.
- For those saying "IRS will come after you", these remote employees are paying full federal, state (mostly CA), payroll and various local taxes while using none of the benefits. The government is probably ecstatic that such people exist.
- The government on the other side is the one you really have to worry about. Locals in Mexico City, all over South America, Bali, Thailand, Vietnam and really all over the world are pissed with these "digital nomads" (read: illegal immigrants) who work on tourist visas and upend the local economy while paying no taxes. It's only a matter of time before they all start cracking down.
> Locals [...] are pissed with these "digital nomads" (read: illegal immigrants) who upend the local economy and pay no taxes
Wait, aren't digital nomads literally bringing money in from another country? They pay taxes on everything they consume, yet they don't take the money from inside the country, they bring it in from the outside.
Not all jurisdictions have sales taxes. And sales taxes aren't anywhere close to covering 100% of the budget for a city/state/country.
That foreign money mostly goes to a handful of landlords/Airbnbs and tourist-friendly businesses (which are often foreign owned themselves). That in turn drives up prices of everything for locals – who are seeing no increase in income and moreover have to pay income tax and a ton of other taxes on it, something that digital nomads conveniently skip.
An influx of foreigners and foreign money isn't automatically welcome in a local economy.
For most purposes, a foreign tech worker is a lot like having an extra tourist on any given week. They are giving money to your local businesses, but aren't competing with locals on anything but housing. The locals are going to see an increase in income in the very same way that they do in tourist towns: Extra demand for goods and services will provide more jobs and quite possibly marginally higher wages.
Take a random tourist town: Say, in the southern coast of Spain. Then tell them that finally, they had managed to get rid of all the tourists, forever. Is that good or bad for the town? It's not as if there are no externalities, but in general, tourism is going to be good for your economy, and the amount of extra taxes the tourist pays on lodging is pretty low. Which Caribbean islands do better, those that have a lot of tourists, or those that don't take any external money?
Also consider what happens in the opposite side of the remote worker, where what you get is the equivalent of a foreign worker who comes in, pays taxes, but spends basically nothing, and spends all their salary in remittances, to be spent abroad by their family. The worker is competing with you for the job, but then doesn't spend it locally! You will not find many municipalities that are all that happy of having a lot of jobs formerly done by locals in offices suddenly done by someone that is far away.
You are assuming that all tourism is a net positive for any region, which itself is a faulty premise. In a lot of cases unchecked tourism, immigration and foreign money only increases the income divide among locals and contributes to inflation and gentrification.
Not all these foreigners are living in tourist towns. They aren't staying for a week or two, but months at a time. They aren't staying in hotels meant for tourists, but rather competing with locals for apartments (a lot of them having turned into Airbnbs because of it).
This is the primary reason housing is in crisis in the US. Tech workers and foreigners finding cheap but gentrifiable places and driving up the price of housing to the point no one can afford it but them.
While OP is right in that these people are a net good for the economy at large there's a reason a LOT of countries do not allow foreigners to own property. The US is one of the few places where you can without much trouble. You can see the problem this causes with states adjacent to California, like Nevada, where the average house is now over 10x the average income thanks to the tech emigration.
Still blatlantly ignoring the majority of people who are not wealthy enough to profit from tourism, but only get the downsides of it, which I'm not going to list here as they are many and proven.
Edit: No, more potential careers as an underpaid waiter or touristic guide is not an upside.
> is a lot like having an extra tourist on any given week
And as OP explained in the comment you're replying to, tourism is not necessarily a positive for the locals:
> That foreign money mostly goes to a handful of landlords/Airbnbs and tourist-friendly businesses (which are often foreign owned themselves). That in turn drives up prices of everything for locals – who are seeing no increase in income and moreover have to pay income tax and a ton of other taxes on it, something that digital nomads conveniently skip.
It doesn't really matter if you're a digital nomad or a classic tourist, the same downsides apply, but in the case of digital nomads they're even working while being on a tourist visa. They should pay taxes to the local administration but they don't, so that makes them a double problem.
In most popular tourist destination there is a special tourist tax, paid at the hotel reception desk. Sometimes it is included into hotel rate and visible only in a detailed bill.
Maybe it's time for governments to stop relying on income taxes so much, and instead really on land/property taxes for the bulk of their revenue. Sales taxes are regressive, but there are ways to keep them from hurting lower income folks as much.
It is very hard to collect personal income tax in developing countries. OP's tax revenue claim just doesn't match the data. On the other hand, corporate tax and VAT are very easy to collect. Digital nomads are very good for these revenue streams.
It is true these digital nomads don't contribute to social security benefits. But they also rarely take from it. So it is a mixed bag.
Property taxes are extremely regressive. Probably the first or second most regressive tax you can conceive.
I, a lowly middle class worker buy a house in Cheapville. I can afford it, and the property tax, so I am happy. 20 years later I own my house and hundreds of thousands of immigrants from TechVille come buy up all the property. Great! There's no houses really on the market so the value sky rockets! Problem... my house value goes up, but so does my property tax. In fact, it's so expensive now I can no longer afford to live in the house. I have to sell MY PROPERTY because the STATE has imposed a tax specifically designed to destroy the idea of property as an owned right. In some circles this would be considered theft-by-taxation which is probably the only correct interpretation of this scenario. My house has to be sold because I can't afford it, it's bought (read: stolen) by some rich tech bozo with more money than sense, and I have to move. Probably to a different state where then I contribute to the very same problem there. The problem is the regressive property tax enabled this. The only solution is to not have them for residential non-commercial property. If property is not producing tangible value it should not be taxed. Taxes are collected at the sale of the home - this is enough. If it isn't, congress needs to tighten the purse strings.
Property taxes are regressive, prevent you from ever truly owning your own plot, and disproportionately reduce the wealth of the people who spend most of their lives creating it for other people. They are probably the most distilled form of evil the financiers of a state or country can create because they are totally unavoidable and because of the way percentages and property value are calculated can very quickly go way out of hand. The only people that benefit are the rich house flippers and people with so much money their property taxes are a rounding error. It puts property in only the hands of the wealthiest. How is this a good thing?
> Property taxes are regressive, prevent you from ever truly owning your own plot, and disproportionately reduce the wealth of the people who spend most of their lives creating it for other people.
Property taxes are a form of wealth tax. The more wealth you own in the form of property, the more you pay in tax. Many people who work for a living don't own any property at all - about 35% of households in the US are renters. They don't have this problem of "wow my house is worth $1.2 million so I've got to sell it and move" - they've got bigger problems.
Really? I thought the purpose was to create a new landed gentry, with hereditary title to land.
200 years from now, your descendants can pay their annual peppercorn to the state each year (after inflation and the statutory maximum annual increase have their expected effect) while the plebs toil in labor to pay you rent.
It really is such a shame that the founders of our country were so short-sighted that they explicitly prohibited that in the constitution. Maybe we should think about amending that.
It won't move, but the utilization will change to be minimize the cost.
I suspect that will be a net negative for anyone who needs to rent because they cannot afford a mortgage, maintenance cost, insurance, contribution to shared infrastructure like plumbing and electrical, and taxes together.
I considered renting an apartment in two different commune-owned buildings (I was a student, not looking to own). Both were just as expensive and in significantly worse condition than all of the neighboring housing options. I found w nice place, but would have been better off with a slumlord rent-seeker than either of those places.
> It won't move, but the utilization will change to be minimize the cost.
Yes people will build more medium density housing instead of having zucchini gardens in one of the most expensive regions of the world. Higher density would be good for renters in the local area.
Moved to New Hampshire lately and I love it. No state income tax, no sales tax. Property tax is a little bit higher than where I used to live but on the whole I worked out that I still save $10k in a typical year in tax burden compared to the same value property there, not even considering the lower COL in other areas. Working from home in a quiet peaceful hobby farm in a cheap state is living the life.
I cannot get behind a property tax - if you own and have paid off a house, the idea that the state could seize it is abhorrent. Tax transport, wealth, sales - almost anything else in preference to property. Housing is a primary need.
The reality is that to own property you need a means to enforce that ownership. That places a constant forever cost burden on the community at large. You need police to enforce against trespassing, you need a legal system to process and transfer titles of ownership, you need infrastructure that is in part supported by public funds, you need an army to defend against hostile takeovers from foreign powers. This notion that you can own a property and end all ties to your community is ludicrous.
Taxes are completely justifiable to allow you to have these means to enforce your ownership rights.
I'm not anti-tax, I'm anti-property-tax. You could cover community burdens through infrastructure tax, transport tax, real estate sales tax, etc, and even ultimately a wealth tax.
The issue with those taxes are that they are avoidable and then a property owner has found a way to not pay for the upkeep costs of their property again. The most straightforward way to ensure property owners are paying those costs is to apply the tax burden to the property itself and confiscate the property when it's not paid. It ensures timely payment of taxes.
Where you and I would agree is on the assessment methodology which is in most jurisdictions a money grab since it's usually always based on the market value of the property and not on the costs to provide necessary gov services.
> The issue with those taxes are that they are avoidable and then a property owner has found a way to not pay for the upkeep costs of their property again.
100% true that a physical property is not exactly going anywhere, and so it's extremely convenient to use as a stand-in for wealth / ability to pay taxes. That said, this could be worked around if governments were incented to do so, given that finance is almost entirely electronic at this point; offshore banking could be reined in, for example. There will always be loopholes and ways to avoid a tax burden, but if the (financial) penalties are commensurate to the dodge, then there's a reasonable disincentive.
What about land? Is it ok for someone to own a communal resource? Are property taxes a way of paying the community back for the exclusive use of a piece of land?
> Is it ok for someone to own a communal resource?
If there is zoning (and well managed conservation), I don't have a problem with it. I've lived near areas with no zooning at all, and that's a race to the bottom.
You could have 99 year leases or similar instead of ownership (Japan does this?), but that is unfair to e.g. grandchildren who inherit a farm which they've worked hard at all their lives (where land is essentially their means of income.)
Yes there is less land to go around, but that problem is ultimately overpopulation, and that's an _entirely_ different topic.
and even then, a digital nomad's expenditure inside their country _is income_ to the next hop. They're simply losing on a single hop in an infinite chain of taxation.
soo... you want those that ammount to tourists to pay taxes in the country they visit? By your logic I should pay taxes to the country I go on holiday on the paycheck I get while being there.
You are forgetting the tax income from the money all those "tourists" spend in that country. Who do you think benefits from those taxes?
I do agree with you that it can befome a problem if those "tourists" start buying properties in those places. That should not be alowed without permanent residence (of, at least, a few years).
"That in turn drives up prices of everything for locals "===> Are you serious? Do you realise how many of these "tourists" (% wise) are needed to affect the market in a city? Even 1% is nothing more than a blip(IMHO).
> By your logic I should pay taxes to the country I go on holiday on the paycheck I get while being there.
No, because when your are on holiday it is not your place of employment.
All they want is if you are using somewhere as your place of employment, that you pay taxes that are due on earning that money in the country, the same as if your are employed locally. It's not unreasonable.
> Who do you think benefits from those taxes?
You can't pick and choose which taxes you want to pay and then say there is some 'benefit' for deigning to pay any at all.
Next time you stay in a hotel, try saying "I've shouldn't have to pay my bill, you should be grateful enough for the 'benefit' of the money I spent in the bar because I was staying here", and see how that works out.
This isn't about being a legitimate tourist though. That has always been allowed. There are not many jurisdictions around the world where you are allowed to work and not pay any taxes though. Just because there is a loophole where you _can_ work remotely and it's extremely hard to detect or enforce doesn't suddenly make it legal, you are simply violating the terms of your Visitor's visa.
Would income taxes from digital nomads make housing prices go down? There would be more money going to those governments but it's unclear that those governments could help offset most of the increase in costs.
No because they increase demand for housing while supply is fixed, and then have much more money than locals to get whatever housing they want. This is what happened in SF for example as techies invaded and displaced the non-tech middle and lower classes.
The same reason many cities that are now overcrowded are pissed at all the rich people that moved in and bought everything up.
If one or two digital nomads move in, the locals won't care much and the nomads will just become one of the types of people they have.
But if a town becomes infested with them, it can cause all sorts of issues (the nomads won't care about food prices because they can afford US prices, which are 10-100x what the locals have been paying, so prices can suddenly skyrocket).
Tourism has done similar things to cities around the world; turning what used to be actual functioning cities into amusement parks for adults. Venice might be a good example, some say.
Reminds me of one of my buddies who decided to move out of California after going permanent remote. He encountered more than one realtor who informed him that the seller intends to charge a "Californian Tax" percentage on top of the asking price to any buyer from California because they just don't want us in their communities. Talk about cutting off your nose to spite your face.
Passing up money in the short term for the perceived good of your community can't be fairly equated to "cutting off your nose to spite your face". But it would be more fair for the seller to try to get to know the buyer and go from there instead of just assuming by state.
> Wait, aren't digital nomads literally bringing money in from another country?
I used to make the same argument, but it's just so convenient when it's easy to forget that there is a reason why income tax exists on top of VAT in the first place. And that's because VAT doesn't cover all of the budget expenses.
So you pay your hefty income tax back home, and only pay VAT on the products and services provided by (private) entities. The proportion of the budget not covered by VAT is covered by the locals and their income tax. That's not OK.
Same reason why the most touristy places impose additional tourist tax.
Citizens working without paying into pension, healthcare, or following local employment laws (best example: France, that really cares what employees in their borders do).
You can't simply unilaterally declare that sales tax compensates for everything you do, and think laws don't apply.
They would still be using a lot of city/state/country local infrastructures (utilities, roads, parks, emergency medical/police/fire services, local libraries, to name a few), won't they? Costs for these might not be funded by Sales Taxes alone or at all. Not paying one's dues to the City/State/Country of residence in accordance with local laws is not only illegal, but also immoral; it breaks revenue calculations city/state/country makes based on multitude of things (at least in most sane places), and if a nomad is not doing not paying equal share, then the locals are footing the bill for them!
Mere income tax on landlord's rental income is not something that will come close at covering all the income gaps city/state would face if one were authorized local worker.
As someone else pointed out, these nomads are earning in foreign currency that literally translate to 10x-100x in local currencies, they will simply drive the prices up and soon drive them up enough out of reach of the locals simply because nomads can afford inflated prices.
Roads, parks, and libraries are pocket change compared to pensions and healthcare in any developed nation. In the UK you might be able to skate on the NHS, but someplace like France actually has a free-market healthcare system backstopped by insurance. That leaves pensions, and if you’re not a contributing citizen, you’re not getting paid out of it either.
and who is receiving these 10-100x'd prices? The locals who are providing value to the purchaser. Higher selling prices are profits in some locals' pocket/bank account. Why does this side of the equation never get talked about?
Yes I may make the price of a taco go up 20c, but that's 20c more profit for every taco sold at that price. The workers, the business, the real estate value, the whole supply chain can all now command a better price because of my "wasteful" spending relative to the context.
That is assuming the (much debunked) trickle down economics. A 20c increase in taco price is not going mean an increase in the worker's pay (if any at all). Minimum wages haven't increased (much) in the States for over a decade, in spite of record profits for a lot of these minimum wage employers. Sure, the price increase is going to help with wealth accumulation for some, but certainly not all, and the ones left out will feel the sting. Someone on a pension will see a sudden increase in prices, property taxes etc. something she didn't have enough buffer to accommodate. Of course, there are other forces that will do the same too, but it would be foolhardy to ignore the effects of digital nomads on local economy. Better to get ahead of it in terms of public policy before it becomes too big of an issue. Same way governments around the world are struggling to curb inflation, nomads can cause (unexpected) inflation on local economies.
The same can be said about illegal immigrants and temporary visa holders in the United States. An H1B worker pays taxes, pays into social security, etc, but isn't going to get a penny back out of it.
And yet, for some reason, a lot of people really dislike[1] H1Bs...
[1] Last election cycle, I've received a beautiful election pamphlet from a frothing-at-the-mouth state politician-want-to-be who spent most of his 250 words assuring me that H1Bs are robbing the country by mooching all of its services while not paying any taxes. He, uh, got 40% of the vote.
There's a glaring difference between a digital nomad working remotely and someone on an H1B or an illegal immigrant - the digital nomad isn't participating in the local labour market. Increasing the labour supply (which most assume would decrease the price) is the major complaint people who dislike H1Bs/illegal immigrants. A digital nomad isn't competing with the people he lives near for scarce jobs, so that complaint doesn't apply.
This is the typical communist/labour style answer which ignores that todays mobile work force is not just a body in a geography. An employee past about 5 years experience is essentially unique when observed across the many variables (education, years of experience with each specific tool, industry/domain experience, soft skills etc). Just because a capable expat employee happens to presently be located in Costa Rica, doesnt mean a capable Costa Rican can be found. The most valuable people in the workforce are not cogs.
There's no reason it couldn't be employing a local, but there are an awful lot of reasons it wouldn't. No locals applying chief among them. If the company was explicitly not hiring anyone from Costa Rica, sure, that would be one thing. If the best candidate happened to not be Costa Rican, that's something else entirely.
This is again something you can't just unilaterally declare.
Even if you're right that they're not a burden, which I disagree with since they do actually do enjoy services like police, fire department, mass transit subsidies, national defence, roads, clean air enforcement, etc, this is still not something you can unilaterally decide.
The laws are there whether you think they should be or not.
The country's state budget and its rules are not up to the individual to opt in and out of.
That they have wealth outsized compared to the local economy could have distortionary effects.
One of the biggest examples would be in real estate, where foreigners could be comparatively very wealthy compared to locals, and can thus out compete locals and dramatically raise the price of real estate.
This is why some jurisdictions that found that the amount of properties being purchased by foreigners was becoming startling have brought in foreign buyer taxes to try to even out the distortions in the economy and make it more fair for those who earn their incomes in the local economy.
I was reading about this in Vancouver and Toronto. From what I read, the foreign buyer taxes did indeed massively decrease foreign real estate investment, but it's not at all clear that it actually lowered home prices, or even slowed down home price growth. Not what I expected or hoped to see (as I live in SF and would advocate for something similar here if it worked).
I'd say that's true. The reasons being that the housing economy is an enormously complex system and so while addressing certain problems fixed those problems, there still remained others which still continued to induce high prices.
(using Vancouver as an example, after the foreign buyer tax the city still has an incredibly low near 0% rental vacancy, which makes secondary home investment enormously profitable and continues to keep prices lofty)
This doesn't mean that it wasn't a good idea to address the foreign buyer problem, but it was clear that the system instantly shifted to compensate for the lack of foreign buyers, and new buyers appeared. There was plenty of local buyers, many of which had existing properties with inflated land values they could borrow against and the ultra low interest rates from the pandemic that aided them in bidding up properties to buy. Good for local buyers to have less foreign competition, no real change for local renters.
The most real direct outcome of the foreign buyer tax was the nature of the housing product that was made changed. Previously there were companies that were building "luxury" condos explicitly marketed as pied a terres to a foreign audience (largely from major cities in asia). Overnight this sort of thing went away and the same companies that were previously pushing these products instantly pivoted into building purpose built rental buildings for locals.
Ultimately I think the foreign buyer tax is good for local renters, but further work needs to be done.
It didn't lower housing prices because foreign buyers were single digit percentage of all transactions. Canadian real estate is mostly propped up by Canadian buyers buying multiple properties by leveraging existing equity.
It's not unusual for someone to use their HELOC to buy and 2nd or 3rd property and rent it out.
Of course with rising interest rates (and mostly variable mortgages) that's all coming home to roost now, al la USA in 2008.
If you spread the area widely enough (ie. entirely of Metro Van) yea it was single digits, but if you looked at a narrower amount of municipalities and neighbourhoods (ie. where there were new builds, burnaby and richmond) there were places where it was high teens closer to 20% than 10%. This is why the government ended up acting.
The fact that there was significant amounts of foreign buying is not in contention. You can google Globe and Mail articles from ~2016 that cite these figures.
> Wait, aren't digital nomads literally bringing money in from another country? They pay taxes on everything they consume, yet they don't take the money from inside the country, they bring it in from the outside.
Not quite. They do bring money by buying things and paying sales/VAT tax. However, they don't pay income taxes because in 99/100 times they are not allowed to work, so they are illegal immigrants essentially.
They also come with their LA salaries and make renting/buying harder for locals.
I know people who do that in Thailand on tourist visa, and just have a short vacation every 90 days to qualify for new tourist visa.
I think the point is you are breaking the law. Most sensible people wouldn't care. Its if you get an over zealous customs official, tax hound or local police. If you keep you nose clean you're probably OK but if you get in a fight or piss of the mayor you might get extra tax fines or jail time.
A country's borders are not only protected by paying taxes that are due. It's illegal in most places, save a regulation in place to protect that case, to work from another country without proper papers, read a visa, permanent residency or citizenship.
It goes back to the 'government is not a monolithic entity'. Local tax authorities have no problem with it and likely encourage it ( more money flowing around for just about everything ), but there are always beancounters at the top, who think they may be able to extract even more.
>Locals in Mexico City, all over South America, Bali, Thailand, Vietnam and really all over the world are pissed with these "digital nomads" (read: illegal immigrants)
While it may be the case in other countries, Mexico has fairly straightforward laws that allow you to work remotely for up to 4 years without paying local income taxes. Basically, as long as you have a stable job outside the country, you are fine.
The mood among some Mexicans may be negative, but for the most part Mexicans understand (thanks to a long experience with tourism) that foreigners bring in the big bucks. And this is good for us.
I'm not sure you are correct about the countries the digital nomads are flocking to being pissed about them. Maybe a few locals, but, the government of Costa Rica is encouraging digital nomads because it brings money into the country because these nomads are dining at local restaurants, shopping at local stores, hiring people to clean their house, paying rent etc.. When the average salary in 10k a year in these countries a digital nomad is easily spending enough to create at least one, if not multiple jobs for a local.
I write software for pay. That's it. I don't see my employer as a boss - they are a customer. If they aren't happy with the product, they can find someone else and I can respond to the other 50 LinkedIn requests...
As a contractor you are free to incorporate wherever you want.
I wouldn't work from e.g. Iran, or you could get sued to death when your customer is indicted for violating US sanctions, but yeah why would your employer care?
Oh, because maybe they have various insurance and partner contracts that speak about your physical location.
If your contract doesn't say where you are, then work from anywhere, and follow whatever laws.
If your contract does say where you are, then violate the contract an your own risk.
Mexico is starting to get a lot stricter on FMMs and IMF agents are getting reticent to issue them for maximum term like they used to. I'm told this is a result of IMF getting really frustrated by the number of people who are repeatedly taking out 180 day FMMs with only token returns to the US to avoid getting permanent residence - which is not very difficult but means the tax collector knows you're there!
Sorry, FMM is the forma migratoria multiplé, it's the usual paperwork for entering Mexico for any short-term reason, if you're an American (and I think some other nearby countries). It's not really a visa as those aren't required for Americans, just a form they use to track guests and mostly to collect a fee/fax for stays longer than 7 days. IMF is my own fault, I meant instituto migración federal, but that's not actually what it's called - it's the INM, instituto nacional de migración. I think I was mixing up like three different names in my head.
Mexico is really very lax about what you are allowed to do while in Mexico on an FMM and the fee for one isn't very much at all. But what you can't do is stay past the departure date on the FMM which cannot be more than 180 days from when it was issued. INM agents used to be very willing to just put the full 180 days on every FMM but lately are asking questions about your return plans and only giving you shorter time periods. Apparently there were a lot of people who were living in Mexico and basically going to San Diego at the end of their FMM, staying a few days, and then reentering on a 180 day FMM to return to where they live. This has always been against the rules but I don't think INM really cared that much until recently, because the number of people doing it increased greatly.
I am sorry, but what is the problem? So somebody already pays crazy taxes in their home country, then pays rent in another country (including taxes), sales taxes and likely spends much more than locals in the foreign economy. The foreign taxman gets a wind of possible more money, starts taxing those folks on top of what they already pay and they just move out, spread the word, weakening the economy further. If they overstay 180 days or whatever is needed for a tax domicile then yeah, they should pay taxes there, but with the current tax regimes that might not be technically possible. What prevents folks to stay 179 days in Mexico and 179 days in Costa Rica?
' What prevents folks to stay 179 days in Mexico and 179 days in Costa Rica?'
costa rica visa is 90 days maximum for starters
'expats' are very entitled; they want all the conveniences of a 'third world country' (they will call it 'shithole' when their n-th consecutive entry is denied) they want all the cheap rent;services;food ; they want to use the roads; sidewalks; beaches; national parks; police; emergency services but god forbid you ask them to pay income taxes as a local if they are going to work from their host country ' it is preposterous; i already paid 10% vat on my 2 dollar frapuccino'
In my state, counties also assess income tax. The largest city has lower tax levels for people who work in the city but live elsewhere.
Our payroll app needs to know what days you are working from home. This way, if you work in one county and live in another, the county you live in will get their share of the income tax.
I think this is going to be a huge problem in a year or 2 when cities & counties see a large drop in income and try to figure out how to "fix" it.
The biggest risk is the remote country coming after the employee and/or employer. If you are the employer, and you are 100% sure you are never going to do business in the country, you MAY be ok. However, there are tax treaties at play as well and that can complicate things.
If the remote country goes after the employee, it may get ugly especially if the employee is still there. That indirectly also impacts the employer.
So if you or your employees are going to work from a different country, read their regulations and be very careful about staying longer than the time period that they consider you a resident for tax purposes.
This is quite an interesting space for some future startup.
wait until your rent and other prices drive up by influx of abnormal salaries for the local economy and everything becomes ultra-expensive for you. Barcelona, Mexico City, ...
Are those people planning to all stay on the same place? South America is quite big.
Anyway, I'm not sure rent is high on those place (or rater specifically Mexico City) because of immigration. I can't imagine deciding to move to Mexico and picking specifically Mexico City instead of somewhere else (it would be like deciding to go to Brazil and insisting on living in São Paulo - people have many reasons for living there, remote working immigrants have almost none). At the same time, there are plenty of reasons to have expensive rents there that don't depend on immigrants.
Are the governments really that upset with illegal immigrants that (typically) don't commit crimes (aside from immigration/taxes) and spend (by local standards) crazy amounts of money in the local economy?
It's not just that. In policy making, being lax about a particular thing for a particular group (in this case, border control) opens up a pandora box of problems by legitimizing that very thing for everyone else.
no, not really, unless it is politically expedient for them to appear to care. most politicians view themselves much closer to the digital nomads in terms of class/social status as opposed to their constituents / regular folk, ex. politicians already mostly live in gentrified/fancier areas, dine at the higher end restaurants, and fancy themselves world travellers
Immigration and tax evasion generally don't directly hurt someone who'd be pissed off that the government let the crime happen, unlike e.g. theft, robbery, rape, or even just loitering around drunk in public.
I'm not talking about philosophy, I'm talking about what gets people angry at the government.
Imagine that you're running a pub. There's a regular that dresses funny, runs a small show, drinks like a hole, and at the end of the day, always runs out without paying his bill. He's stealing from you. However, there are many people who go to the pub just to watch his antics. The food and drinks he steals are nothing compared to the extra money you make from that.
You have every right to kick him out, and you might do it out of spite because you will not tolerate thieves... but the pragmatic thing to do is to look the other way, so it's not surprising when that's what happens.
Your hypothetical is hollow sophistry while taxation is both law and social contract. Miss me with that "I'm not talking about philosophy, now imagine you're a cowboy riding a dinosaur" bollocks.
> - The government on the other side is the one you really have to worry about. Locals in Mexico City, all over South America, Bali, Thailand, Vietnam and really all over the world are pissed with these "digital nomads" (read: illegal immigrants) who work on tourist visas and upend the local economy while paying no taxes. It's only a matter of time before they all start cracking down.
Thailand explicitly gives out digital nomad visas for this?
About your last point. Interestingly, some governments have been trying to entice people to work remotely in their countries. Iceland is the latest example. I'm guessing that, while they don't directly collect the tax revenue, there's some incentive to the local economy as that's where a lot of the consumption would happen.
> upend the local economy and pay no taxes
I understand that taxes are important to maintain local infrastructure, but up to a certain point, isn't it beneficial having a few people literally bringing in foreign money to pay for the same products and services other locals pay for? There are places that officially encourage that behavior.
I understand how that might eventually upend the local economy - it's called gentrification and while digital nomads certainly contribute to it, it surely can't be fully blamed on them. Places where people want to live at will eventually get gentrified in some shape or form.
The logic behind labeling digital nomads as illegal immigrants completely eludes me. I genuinely don't understand why you would make that assumption.
> The logic behind labeling digital nomads as illegal immigrants completely eludes me. I genuinely don't understand why you would make that assumption.
Close to 100% of them are on tourist visas and are explicitly not allowed to work in the country. What else do you think an illegal immigrant is?
Can you share the source for this data? I find it exceptionally difficult to believe.
I do not condone people doing anything illegal. But you can maintain the lifestyle of a 'digital nomad' while not breaking any laws whatsoever. I definitely do not believe that 'close to a 100%' of people would risk their jobs, the wrath of the tax man and potential prison time by not abiding by the relevant legislature, especially given that there are usually many available options.
Well, say you're working for US company, and you're US citizen. You move somewhere else and still working for that US company. Now, try to get a work visa or work permit in this case. What are you going to do? Got to country X consulate and say "I want to work for the US company while I stay in your country, can I haz visa?"
But it entirely depends on local laws. Canada allows you to work for non-Canadian company that has no business in Canada. Things, a bit more complicated when you sell goods and services in Canada, though.
Spain has new digital-nomad visas that allow working in company that aren't in EEA. Before that, like many others EEA countries, they didn't allow working on tourist visa.
> "I want to work for the US company while I stay in your country, can I haz visa?"
Yes. As we've been learning for 20+ years from the music industry. If you restrict easy access to what people want or make unrealistic demands, then people just side step you. But if you make it easy and accessible people happily pay.
Obviously the details vary, but frequently the terms are as egregious as
1. Regardless of length of stay we now want a % of your annual earnings
2. The process involved takes orders of magnitude longer than your stay
3. The typical legal fees involved is orders of magnitude greater than what you'll even earn in the time period, meaning your best alterative to "No" is actually to take time off, paid or unpaid
4. You're literally bringing them an opportunity so it feels unjust to be barred. An opportunity to have tourist income -- something that many countries _pay_ to compete for.
There will be a massive upside for the first country to have a safe desirable location, with fantastic internet, and visa policies that make sense in the above rubric.
Usually it means work in the country you're visiting- I can't go to Mexico for a week and wait tables, but if I vacation there I still get paid by my employer.
Yes, but 'work' also has a legal definition. My research mostly involves Canada, so I will cite from the IIRC [1]:
"What kind of activities are not considered to be “work”?
An activity which does not really 'take away' from opportunities for Canadians or permanent residents to gain employment or experience in the workplace is not “work” for the purposes of the definition.
...
- long distance (by telephone or Internet) work done by a temporary resident whose employer is outside Canada and who is remunerated from outside Canada;
...
We recognize that there may be overlap in activities that we do not consider to be work and those activities which are defined as work not requiring a work permit in R186. However, the net effect (no work permit required) is the same."
So yes, you can work remotely from Canada, while on a tourist visa, for a foreign (non-Canadian) employer.
A lot of OECD countries have treaties (look up 'double-taxation treaty between A and B'), that govern this.
> This section contains policy, procedures and guidance used by IRCC staff. It is posted on the department’s website as a courtesy to stakeholders.
My point, which I also made in another comment in this thread, is that law isn't code.
If you spend 3-6 months every year on a tourist visa in Canada working for your US employer, Canada's going to cotton on eventually and take action. If you do it a few weeks a year, you'll likely be fine.
Their test is "are you directly or indirectly competing with a Canadian worker?". If your employer is really ok with you being abroad 3-6 months/year then they should, presumably, also be ok with hiring Canadians or legal permanent residents to do the same work 12 months/year from Canada.
Letting your employee be out of the country for 3-6 months every year on a tourist visa is a lot different from actually getting incorporated in that country and paying income taxes there.
>for your US employer
US/Canada have a very interconnected labor market, so in this context your comment is perfectly valid, and I would guess there are additional rules for this specific case. For literally any country other than US though, I don't see why it would be an issue for Canada or the country of origin, even if you do it repeatedly year over year.
> I don't see why it would be an issue for Canada or the country of origin, even if you do it repeatedly year over year
Unless you're intimately aware of the intersection of tax and immigration law between Canada and every other country on the planet, that's a rash statement to make.
> Letting your employee be out of the country for 3-6 months every year on a tourist visa is a lot different from actually getting incorporated in that country and paying income taxes there.
Except that the company's responsibilities may extend far beyond just incorporating and paying income taxes. Every country's tax system is different and weird.
Companies don't require their employees to tell them their real address just to be mean, or to prevent labor arbitrage. They have genuine, legal reasons to do this.
Lee Child started his career as a writer because it was one of the few jobs he could do while physically located in the US while not having local work authorization.
It comes down to how you define 'working from a country'. Doesn't it mean 'being employed by a local company and paying income taxes' there?
If I go on a vacation and respond to a few work-related emails, am I breaking any laws because I'm working on a tourist visa? Yes, that is ad absurdum, but I'm trying to point out that it's not as clear cut. There is a line that international treaties define, and staying someplace (sometimes even up to 6 months) and working there doesn't necessarily have any income tax implications for you or your employer.
> People's attempts to hide their remote lifestyle are mostly laughable
That can depend on how/where they're staying. If they're at "home" abroad, with a similar time zone, then there's often no way to tell except technically.
I have a team mate who often spends time across the border for weeks at a time. We wouldn't know if she didn't mention it.
We are in the EU though, so working from other EU countries is fine, within limits.
Timezone is noticeable, but really depends on how different and how many "Webcam On" meetings you have. My home office has blackout curtains, so it's always the same light condition regardless of time of the day.
Now, it's hard to attend some meetings when time difference is very dramatic, like it's 1am in your local, but 10am at work HQ.
> If you go too far of course, then your workmates might notice that it's winter when it should be summer.
Doubt. Most of my co-workers use virtual backgrounds. I wear the same home clothes the entire year.
> And anyone with the login details can see where your login pings are from.
Good luck, I have a WireGuard box at my parent's house that I route my work traffic through when needed. Maybe I should start a business of hosting "residential" VPN exit nodes...
Except I use YubiKey for my 2FA, so where my phone is irrelevant. Moreover, I've never ever granted 2FA app location permissions. Don't even remember any of them asking it. It's generally GeoIP and time is well...the same everywhere?
I’m quite suprised you are willing to hire people who you know are lying to you.
To me, someone like that has demonstrated that they can’t be trusted and I would remove them from the business ASAP.
You can fix a lot of things with an employee/employer relationship, but those things require trust. You just don’t ever know where you stand with someone who lies.
That's kind of an important thing to lie about (money and work related), I'd rather have someone not lying about anything at the very least on that subject.
Actually, I'm editing the comment. Even lying about anything is bad because you'll eventually start lying about something work related too. That's just how it is, whether it's a time table, some interaction you had with a customer where you don't quite paint the truth or anything else. Eventually it always impacts the real world. That's the thing about the word "lying", it's not so precise. You practically mixed "omitting information" and "lying" together even though they can be extremely different in quality, depending on intent, situation and much more.
> I’m quite suprised you are willing to hire people who you know are lying to you.
From what I understand, that's most job interviews. If someone has very little practical coding skills, but is a LeetCode ninja, then you get what you ask for, I guess.
I don't lie, but it also seems to make me unpopular. Fortunately, I don't need the work.
You don't need to worry about the government on the other side either unless your company actually does business in that jurisdiction in such a way that they can sanction you. Local governments are usually trying to attract digital nomads with remote working visas. One gov can crack down - the nomad would just move to a friendlier jurisdiction.
As a remote contractor turned employee with adhd, I've stopped guilting myself about this and stopped really trying to hide it. I focus relentlessly on doing whatever it takes to get the shit I've agreed to do done in the time and way I can best do it. But I'm not moving to another country either.
I don't violate foreign laws if I buy a goods online from another country.
I don't need to know anything about laws governing manufacturing to purchase a screwdriver made in California. I only need to know my own laws.
Is it legal to import screwdrives in my jurisdiction? Yes.
Can I do this transaction without violating my own sanction laws? Yes
That's it.
Whether the California entity is allowed to sell to me is their problem, not mine.
The same applies for labor. I want to buy foreign labor? I negotiate the price, I get the work, I pay the invoice.
Which laws do I consult? Every potential country-to-country mix in the world?
No, I consult my own laws.
Is it legal to purchase foreign labor/services. Yes.
Can I do this transaction without violating my own sanction laws? Yes
Whether I buy a website or a screwdriver - I do not need to know anything about who I'm buying it from beyond the necessary information to avoid international sanctions.
> The government on the other side is the one you really have to worry about. Locals in Mexico City, all over South America, Bali, Thailand, Vietnam and really all over the world are pissed with these "digital nomads" (read: illegal immigrants) who upend the local economy and pay no taxes. It's only a matter of time before they all start cracking down.
Also your employer needs to worry about this. And therefore you need to worry about your employer suing you.
If you think that's far fetched, do you think your employer will NOT throw you under the bus when France sues your German employer for turning a blind eye to where their employee is?
Frankly as a tech manager YOU are adding legal risk to yourself personally by protecting the employee from the company. Arguably YOU personally are complicit in tax fraud.
This is trash. I hire engineers all over LATAM. I could not care less if they pay their taxes. I do not pay any taxes in LATAM. My company does no business in LATAM. What are they going to do? Sue my company? LOL.
P.S. I used to be a lawyer and I can weigh the risks. Completely negligible compared to all the other risks I have as a founder.
As you say this is risk. You can make any tradeoff you want, and you are probably right.
You can hire someone you think may be working from Iran. You're pretty sure you won't get caught violating sanctions for it.
> I could not care less if they pay their taxes
I don't know LATAM employer side taxes, but if their tax offices do decide to target you then what you "could not care less" about will not matter much.
But shrug, yeah you probably won't get caught.
My favorite lawyer quote: "Legal didn't say we can't do it. Legal says if we do it then we may all go to jail. It's not the same thing".
France won't sue the German employer, If anything illegal occured, "France" will sue the person exporting the labor, not the person buying it.
The jurisdiction of France encompasses French people, and French entities.
If a law was broken in Germany about importing labor, then it's the German goverment enforcing the law.
Which only means you have to follow the laws of your own country only. Which includes your own countries sanctions, but doesn't include all countries sanctions.
> The jurisdiction of France encompasses French people, and French entities.
You know that's not true, because you know that shoplifting in France applies to visitors too. Even if one tourist assaults another tourist. Or (in some other countries) two unmarried foreigners kissing in public.
People have had their children taken away while on vacation, because they beat them and local law did not like that.
If you think that France doesn't care about illegal workers within their borders then I don't really know what to tell you.
Different countries have different level of cooperation. I would not bet on an investigation in France about (alleged) organized tax fraud being "unable" to reach German defendants.
> France won't sue the German employer, If anything illegal occured, "France" will sue the person exporting the labor, not the person buying it.
Ok, good luck with that. I hope you got good lawyers advicing you on this risk, and defending you if it happens to you.
> Which only means you have to follow the laws of your own country only.
Like how Assange (Australian citizen) has no risk of being deported to the US to face charges based in laws only in the US, for something he allegedly did while in Europe?
The US doesn't deport its own citizens even to face charges of war crimes, so it may be a special case. But other countries do.
The grandparent comment (from aiisahik) is now replying to you about contractors.
For contractors I agree much more. But a contractor is not an employee (with a huge caveat, because depending on jurisdiction a contractor can be declared a de facto employee, and legally treated as such. It's a long and complex story).
Even from the article:
> “If an employee is in the wrong place long enough, it can have real tax implications for the company as well as the individual,” said Black, who added that many companies fear accidentally establishing a taxable presence in a foreign country.
This from a guy who "helps companies deploy and manage employees around the world" for a living.
And as the employer, I'm the importer of the labor so I don't care. If my contractor didn't pay their taxes that is not really my problem - they will just have to do deal with that themselves. What's very important is that I, as labor importer, didn't have to pay payroll taxes of the country where the labor was based. In the case of Argentina it's close too 100% of the salary. When i pay my contractor triple the average engineering salary they would get from a local country they are more than happy with this situation.
LATAM: government wants income tax, and foreign exchange cuts too. Argentina wants employees to run their paychecks through the central bank so that they can take a 50% cut.
And they also have sales tax.
So government are targeting those off the banking system and export regulations
How do the tax offices of other countries "target me" exactly? What legal options do they have against a US based company with no business/customer in that country?
They can go after my contractors but then my contractors would just move to another country like Uruguay (which btw is very tax friendly towards remote workers and hardly charges any taxes). Some of my contractors have done exactly that.
> Arguably YOU personally are complicit in tax fraud
"I don't understand. All I did was get up in the morning." line from The West Wing from a similar circumstance when the council threatened jail time for not reporting someone.
I have no real problems being people wanting to work remotely now and forever but I do think this is going to require a new legal framework to support it.
For better or worse there are very real tax issues associated with employees working in states and countries different than what their employer and government believes. A lot of these folks are knowingly or unknowingly dodging taxes in a way that is going to have severe consequences for them and company.
Establishing a tax base in a new city or state can put a company on the hook for thousand if not millions of dollars worth of additional taxes. And for the worker if you’re company isn’t withholding the right amount of state federal and local taxes you can find yourself with a huge tax bill at the end of the year.
Yep. When I am hiring remote in US (out of state), we put a condition in the contract that you will notify us if you are planning to move from your home state because we may have to establish tax residency/nexus in that state as an employer. If an employee moves somewhere else and lies about it, it can put both the employee and employer at serious risk of violating compliance/HR/tax laws. For example, there is something called Workers Compensation that the employer has to buy. If an employee gets injured while working, workers comp. may matter based on the location of where they were at the time and can get denied if there are discrepancies. As an employer, we absolutely cannot risk having employees working from anywhere when they are supposed to work from specific locations only. No one likes these stupid laws but we have to follow it as an employer.
It is a little bit easier for international hires if they are just doing contract but even then things like W8-BEN etc come into play and dealing with IRS is always tricky and risky.
Honestly, if we are going fully remote (anywhere,anytime), we almost need a multi-national agreement/treaty so that employers are not left trying to deal with BS stuff. And no, services like Deel/remote.com are not enough.
In the US there are already many states with population centers that cross state boundaries; those states often have negotiated with each other to solve some or most of these issues.
So if you live in Wisconsin but drive to Minneapolis for work each day, they know how to handle it.
We need more of those and closer to pairings for all states to make true "work from anywhere in the US" possible. I doubt it'll happen, because the states won't agree on the baseline level.
globalization, cheap easy access to air travel, and the internet are breaking down the systems that were working fine for countless years.
It's not limited to employment, either. Create a SaaS or other internet-based business and try to serve customers outside your nation. Or even outside the border of your state/territory/province. Entire services such as Paddle exist just to deal with this. But I suspect most people are trying to fly under the radar here using regular Stripe, etc. and not dealing with any of it, just like digital nomads do.
It may but mostly likely won't unless you're a huge company.
I hired a bunch of people outside the US and it's not a problem. Use Deel and hire them as contractors. Make the contractors fill out W8BENs. Don't let the HR folks and lawyers scare you - they don't understand risk vs reward mentality of a startup founder.
Outside the US is a bit easier. How would you hire an out of state employee IN the US who moves to a different state ? You will need to register your business in that state then. Deal/remote.com don't help with that.
Already had that happen. Employee moved out of NY to FL. Did nothing except categorizing him as a FL resident in our HR system. Did not have to form a new business in FL or register as a foreign entity there. Employee lowered his taxes because he is no longer paying NY taxes. Great for everyone!
You may want to double check this. May be your HR System filed stuff on your company's behalf but you absolutely need to have a setup in the state where your employees work and that includes Florida.
Ouch, yeah. My team is losing a truly excellent engineer because he moved home to the UK during the pandemic, and corporate eventually noticed and said he could either 1. switch to our UK unit and work on their projects at their pay scale, or 2. leave the company.
He's leaving to work for a friend's startup and I hope he gets rich.
Is there a specific rule anywhere federally that any US state that says you must be aware at all times where your employees are when spending personal (non-work) travel time?
Moreover:
1) Can a state with no tax nexus to the firm (until the employee moved into it) have some kind of enforcement mechanism on the company ?
If (1) is no, and it comes down to a judge,
2) is there any case law that shows what is reasonable ? Does employer need to check every month ? every year?
3) Does a company have any responsibility if the employee lies ?
You must be aware of where your employees are working from because you have an obligation to follow the employment and tax laws of that location. If your employee isn't doing work, you aren't required to care (beyond any IP or personal security concerns you may have).
This is one reason among many we should eliminate employer-based tax enforcement. Your taxes should be between you and the government; the government should not force your employer to act as a tax nanny (e.g. with mandatory withholding).
That still wouldn't absolve companies of the obligation to know where employees are working from. Employment laws and worker protections vary from one state and city to another. To give one example, I had a friend that was fired from his Arizona job in ~2015 when his boss found out he was gay. If that friend had been working from California instead, he would have had legal protections.
First, the employee (not the company) is the willing participant with the state benefits and obligations.
If the employee was hired in AZ, and never changed his tax residency to say CA with employer, why would employee be able to claim protections given by CA? If employees are going to play the game, they should be OK with the consequences.
Second, company level agreements don't work this way. Why should tax nexus ?
For examples a company is based in CA, so it states its legal venue is in CA for contract disputes. Company then moves to FL....The tax residency change does not give the company the right to to update its legal venue to FL for convenience with its contractual counterparties.
So then, why can states break basic contract rules, which we hold sacrosant at the company-person level ? And what regulation exists to entitle states to pursue companies that do this unwillingly ?
There are laws that state you must pay taxes, not discriminate, etc.
What are the laws that mandate companies to know where your remote employee is working at all times ?
Should a company need to know the rules of 50 different states at all times, to know if they must check employees working offsite ? And how is a company subject to a jurisdiction's rules that it does not know it is party to ?
You're misunderstanding things. There's no law that companies have to know where their employees are working from. It's simply a consequence of the fact that governments have sovereign power to regulate things within their borders, including employment. Companies that pay to have work performed within state X generally [1] have to follow those regulations. If an employee moves to another jurisdiction and the employment agreement is not compatible with applicable local laws, then there are two main options: The relationship can be terminated or it can be brought into compliance.
If a company has employees in all 50 states, then yeah they need to have compatible employment practices with all of them (plus the respective cities those employees work from, for extra fun). In practice this doesn't come up much because most employment regulations are minor and most governments have similar rules.
[1] there are a million qualifications to this, speak to a lawyer if you want details about your particular case
The problem is that these laws are all written from the logical perspective that employment is mostly a thing where work occurs locally. What we need are new frameworks specifically for remote work and a way to manage this all internationally. Maybe something similar to that minimum corporate tax that has been proposed (on all companies internationally) but for individuals?
I understand your point but axing the entire tax portion of this problem is massive. Sure, your employer would probably still have to know to some degree, but it would be much easier and could end up with something like "you don't need to tell us unless you're working from $listOfPlaces".
Good luck getting that (potentially every changing) list from the hands of your HR and legal departments! Remember, that (at least in US) lot of protections and laws change quite frequently and not knowing where an employee is would put the company at huge risk. Companies, for most part, establish their bases where they find local laws are favorable to them (in addition to ability to find enough able warm bodies to fill the positions), they don't want to open themselves up to lawsuits, legal hassle, what-nots from state/city the laws of which they are not fully appraised of all the time! What happens when that @listOfPlaces change, say every year?
Not going to happen (would be complicated and makes tax revenue collection harder and reduce govt income while enabling widespread fraud). Also worth considering this is risky from an employer perspective
as having employees based in unexpected places also means unexpected, possibly large liabilities eg local sales tax, employee rights etc. Specifically for US firms, foreign employment rights differ greatly and are often stronger in ways US firms find surprising eg around annual and parental leave. For example, a someone working from, say, France for a US firm with EU retail customers could quite possibly trigger a EU tax enforcement action against the company if it’s not on top of things. Or they could quite reasonably avail themselves of their much better French leave and competition rights.
Ahh.. but you see. This way there is a cashflow for interim projects and government does not have to wait for you to voluntarily give what you think is fair:P
We have established that during onboarding a person enters their home address.
My question is different.
What sort of regulation or mandate forces an employer to keep checking over the employee's shoulder? And how does reasonable get defined in this context ?
In other words, what mandates exist for companies to force them to play big brother , and also define what tests must be done when playing big brother ?
And why does the employer come in defense of a state with which the company has no tax-nexus otherwise?
"Does a company have any responsibility if the employee lies "
May be, may be not but in practice, you are not going to be able to tell IRS or another compliance org. that sorry, my employee lied so it's not my problem. As the employer, you are still on the hook for any taxes and other compliance related issues regardless. You can sue your employee may be later but that is not going to save you from the wrath of Uncle Sam and others.
Why would an employer be unable to claim indemnity if their employee committed fraud? I agree that your position is the safe, conservative perspective, but I don't think it's quite so absolute.
I don't think the IRS agents will catch the guy in the article who allegedly lives and works in England, but actually lives in Thailand and works in England :)
To be perfectly fair, I don't think "It's $DATE, that should be automated by AI by now" is really a joking matter on this site, considering the audience. :)
Real question: Strictly speaking from a software engineering perspective, who cares? Why does a framework of taxes created by people who don't understand technology get to decide where I move around to?
I signed up for your job in a certain location and a certain date. That doesn't entitle you to keep track of where I am the rest of my life. As long as I'm able to be reached at the initially agreed upon location, regardless of how I maintain that communications channel, I never agreed to let you dictate where I live and move to and frankly nobody has that right.
Or is my body my choice just a convenient catchphrase for one topic only?
Serious answer: Wherever you choose to live, you benefit directly or indirectly from services paid through taxes. Maybe your employer doesn't care where you live, but the jurisdiction where YOU are does care about where you work because you are being paid but you are not paying what others around you are paying to live there. This is a 3-sided relationship between you, your employer, and the civil society you live in and WFH in a different country is unfair to one side of that triangle.
Countries have mechanisms to deal with this. VISA's, they can simply charge more for longer stay visa's. Would they capture all of potential value of those taxes? No. But they'd likely capture a decent amount of extra money which they otherwise wouldn't have got, while still restricting people from taking native jobs in their countries which is what the wider populace actually cares about.
Pretty sure some countries are doing this already.
There's quite a few now, something like 33 countries with these visas. The terms tend to vary. I took advantage of the first one, the Barbados digital nomad visa which they created to work around the loss of tourism due to COVID. Since most taxes in Barbados are sales taxes and they have a peg to the US dollar it has worked well for them in terms of foreign currency reserves and supporting the tourist industry during the pandemic.
Other countries like Costa Rica require visa holders to pay local income tax which is fair enough while others don't or have a reduced rate.
I'm unsure of the overall morality of it but it can be done legally through the correct pathways as I have been doing.
I don't like that people will just do it on tourist visas instead though which I'd guess is the bulk of the objection to it.
I think most tourist visa's in most countries which are likely to have this issue are at most 3 months. If a country chooses to allow back to back tourist visa's like that then they sort of know what's going on and have accepted it as a net benefit overall. If they don't permit back to back then after 3 months you've got to up and move somewhere else which many people do, but realistically they're not that much different from a tourist in practical terms.
serious question: how is this different if you live in the city making X amount and then move to the suburbs where X is now supposedly 2X.
In my head we all pay the dues somewhere in some form to begin with - property taxes, sales taxes, income taxes etc.
It’s one thing if you’re avoiding paying those.
but how is it different that Twitter gets a tax write off to move to the Tenderloin. and if Joe/Jill chooses to move to the suburbs or temporarily move to Mexico while still paying state and federal income tax. sure there maybe some property tax loss but isn’t housing crisis already an issue? don’t company incorporate in Ireland to pay less tax?
California has already started to try to tax people leaving, if I remember correctly. Something about the value of investments sold afterwards that appreciated during their time in California.
It's only going to get worse as the differentials increase.
In the US a majority of your taxes go to federal and state governments, whether you live in the city or the suburbs doesn't change where your taxes go and how much you're paying. The cost of living difference in that case is based on micro-economic supply and demand cost differences.
Companies moving to Ireland IMO are definitely exploiting tax loop holes and committing fraud. You and I and all of the countries devoid of tax revenue are hurt by companies benefiting from tax-avoidance loop holes.
> Real question: Strictly speaking from a software engineering perspective, who cares? Why does a framework of taxes created by people who don't understand technology get to decide where I move around to?
Real answer: The "software engineering perspective" you have here is irrelevant to tax/immigration law. Taxation is based on where you live and work (physically). And countries very much get their say on whether or not they'll allow you to live there, for how long, and for what purposes.
This isn't about an individual's right to free movement. It is about keeping employers honest about where their employees work and making sure they are paying their fair share of local taxes.
Groups of people put a strain on the local resources, we need those local taxes to fund those things.
If individuals were allowed to live somewhere and dodge the local taxes, every large company would use this to their advantage. Suddenly campuses of workers would all now be "remote" employees from their offices in some tax friendly area. This would put an undo strain on the local tax base who are now having to foot the tax bill for those not paying their share.
Well, you should care about it because laws apply to you whether you agree with them or not. So, at the end of the day both you and your employer will have to cover those costs. But nobody is preventing you from moving, you just might have to quit and look for a new job.
Picture me this. Imagine You are a foreigner that has software engineering skills but not good enough (emphasis) to compete with the cream of the crop that commands high salary. I.e you are the bottom of the barrel. You can’t afford a property where you live. You can’t afford shit where you live because your society is expensive.
Then you have this bright idea of “oh let me go to another cheaper country and get the benefit of their cheaper society but still command high salary”.
And you still don’t want to pay tax in that country.
Foreigners like these need to be ban 10000%. Losers that can’t compete in their home country and still don’t want to pay taxes everywhere they live.
> 66 percent of the 1,500 full-time employees surveyed in the U.S. and U.S. said they did not tell human resources about all the dates they worked outside of their state or country, and 94 percent said they believe they should be able to work wherever they want if their work gets done.
This is what it boils down to. If you want a remote workforce, you're not going to be able to keep them confined to some box that you decide is acceptable.
I suspect what it really boils down to is laws. Taxation works different outside of US borders, and there may be export restrictions to consider. It's a valid point that you won't be able to nail down a remote workforce that travels within the country's borders, but leaving the country may be a problem.
I am not a lawyer so perhaps my hypothesis is wrong.
In the US we generally tax based on where you live, not where you temporarily reside. Federally if you're a US citizen you're welcome to live anywhere you'd like but the IRS will still require their payment.
States are usually based around where you are more than half the year. But that's likely simple to show. If you're actually not there they don't have much of a complaint.
This gets really messy for consulting companies, where employees "work" at the client location 3-4 days a week, 2-3 weeks a month.
We had to track and report what states we worked in and what days, down to the billing hours, and then in some cases had to file tax returns in some of those states.
Also, all of the partners were required to file taxes in every state where the company earned income, which worked out to something like 46 states and 5 countries.
Read up on the accounting required for baseball players. It's absolutely insane and sometimes comes down to "were they on the roster" or "in the stadium" or "on the lineup" and so forth.
Income is taxed where it’s generated in America, not based on residency (at the state level, the feds always get their pound of flesh). Many people don’t follow this rule but it’s smoothed over by reciprocal tax agreements between states. Companies are usually good about tracking this stuff and paying taxes appropriately, employees are usually not but the company pays the taxes correctly and so the employee lucks into doing their taxes correctly. Consultants will often find themselves confused after receiving a mean letter the first time they fuck this up because most people think as you do.
Income is also taxed if it's generated outside America as long as you're an American citizen. Some people who emigrated to Europe as a child got quite a nasty tax bill for decades of untaxed income when the USA found out that they're still American citizens, for example.
Many countries have tax law to deal with this type of American bullshit but it's still something to be aware of.
Does any state do that? I'd think it could cause a civil war damn fast.
The nexus is "where the work is performed" or "where the employee resides" and usually states have agreements with the neighboring states so it balances out.
In the US we generally tax based on where you live, not where you temporarily reside.
Nope, sorry, completely wrong.
You pay taxes to the states proportionately to how much time you spent in the state for the year. Many states don't even have a "floor" for how much time an employee works in a state before they're required to pay income and payroll taxes to that state, so in some states even one day working in that state triggers tax.
Consulting firms track employees time spent in each state down to the hour so they can properly pay payroll taxes. Many consulting firms will even pay for tax return prep for employees required to work in other states long enough to trigger tax compliance.
It's the employee's responsibility to maintain a current W-4 to indicate their tax withholding, unemployment insurance obligations, and local liabilities. Employers who try to police this more than requiring employees to maintain up to date W-4 are just opening themselves up to liability they otherwise wouldn't need to suffer.
Requiring an updated W-4 does not subject an employer to an additional liability.
Very importantly, the employer is already subject to additional liability by the very fact of the employee working in another state/jurisdiction. It's irrelevant from the perspective of the employer's legal liabilities whether the employee goes through the formality of updating their W-4.
But note that failure to update a W-4 after moving to another state or country is generally considered grounds for for-cause termination.
The problem isn't the company, it's typically the state/country.
It's a compliance problem for the company, it's not about controlling their employees. From the employee point of view, it may put you on the wrong side of both visa and tax laws wherever you are sitting.
For countries they have visas to go on, but moving between states or within the eu zone, how would they even know? If I have a po box or perhaps even a street address in WA or TX (no state income tax) but live in an airbnb somewhere in CA, how can the state figure it out? The employer probably can't either since you could run their vpn over your vpn.
I mean, taxes are a real thing and you have to pay them based on where you (the employee) live and do work. In the US for state income tax, it's a confusing mix of both lived location and worked location in various amounts by governments with a "claim" and with plenty of exceptions to go around. Consulting companies have had to deal with it forever (and states have "handled" forever), because you live in Miami, doing work for a company based in LA, and you travel to your client in NYC for 3 days a week for the whole year (60% of your income "generated" there). This is now a complicated Florida, New York, California scenario.
So the choice isn't Big Brother companies who want to know where you are at all times and respectful companies who allow you to get your work done how you want. It's between companies who are following the applicable tax laws or those who are not. A company that is structurally opting to not follow laws seems untenable. A company is a legal construct in many ways. Whether or not the employee can commit something like tax fraud is perhaps a less interesting question, because, yeah, you can probably cheat on your taxes.
That makes sense, but in the consulting case the employee has a motive to file expenses so the employer know. In this case it seems unreasonable for the employer to be heavily fined when they have no real way to determine their employees whereabouts. And because it would likely take an audit to catch the employee, when it does eventually happen it will be a larger hit to the business.
The error in your thinking is that many consultancies are aware of their legal nexus, and actively protect it, so ignorance is not a valid defense for any sensible company.
Talk to people who work for a big consulting firm, they've been taking "tax holidays" for the last 70+ years to ensure they don't spend more than 50% of their time away from their home base.
These companies are no fools; they wouldn't eat productivity and billable hours if they felt the state wouldn't care.
I get that the company wants to know and protect itself. I'm just not sure how they can after reading this article. Short of requiring all employees to check in physically periodically.
That's precisely the point; Many workers are not applying for work visas, which makes them outlaws and subject to deportation. Some countries have digital nomad visas with 0% tax rates now, but not most.
> If I have a po box or perhaps even a street address in WA or TX (no state income tax) but live in an airbnb somewhere in CA, how can the state figure it out?
Hypothetically, CA is financially incentivized to find that out, how is the the question.
But, if they do then they are going to
1) audit
2) if you don't respond to audit and tax -- arrest
3) at the same time suit the employer, especially if they have any operations in CA for not declaring your work properly.
What you are basically saying is, as an employee, "is it possible to commit fraud in this way". The answer is obviously yes. It's a completely separate question whether or not tax law should be the way it is.
I don't think businesses care, other than issues with taxation if people start working from another country. It's the fault of tax services and governments.
Unless you're working for a defense contractor, in which case they aren't letting you WFH in the first place, foreign governments do not give a shit about your 'insider knowledge'
OK, let me rephrase: as a senior manager within the broadly-defined technology security function of a large US company (that is not a defense contractor), I care, as does our board of directors.
I don't think it's that. Supposing an employee had access to approve and pay invoices for a US company, and then moved to a country that had no extradition treaty with the US.
I wouldn't be surprised if there were worries about someone working from a sanctioned country as well. Would paying their wages break sanctions?
Abroad often means exploiting cost of living arbitrage. Working in a US company with a US salary and living let's say in Portugal or Turkey or Thailand, means that suddenly your compensation for the work you do becomes multiple times more potent. If you remove the money as intermediary, it essentially means that for the JavaScript button you created maybe you could have a meal but now you secure your weekly food.
This is great but most people can't simply move because countries for some reason decided that only capital moves, people stay put and work and if they really really want to move they need to go though months long of bureaucracy and it's not even available for most people.
This imparity between people breaks the natural tendency of equalisation and the arbitrage remains and creates political tensions because suddenly some services see unnatural demand, especially housing is particularly badly hit.
Effectively some people get particularly good compensation thanks to the arbitrage when other people who might be working just as hard and could be jast as important for the function of the society get screwed if they can't work from home and miss out on the arbitrage and can't move to the higher paying places because they are only(!) human capital.
So my argument is, I guess, this should be prevented from happening or the WFH from abroad people should be treated as local workers and pay taxes to to the host country. Ideally, anyone should be free to work and live wherever they like but since we are in a deglobalisation trend I have no hopes for it. So yes, WFH from abroad should be actually international workers and taxed accordingly.
Maybe this is just a sign that income taxes are an outdated way to have people that use your local services pay for them? Sales tax at least has shipping destination to go on.
In many countries where enforcing income tax is hard, they do that. Often they still have income tax but since no one pays it, they try to collect it through VAT and other means. That's how you have very expensive iPhones in poor countries. It's not fun.
Sales tax is a tax that hits low income households harder, since they consume a higher portion of their income. And it's impossible to have a progressive sales tax.
So switching from income tax to sales tax would transfer money from the relatively poor to the relatively rich.
> And it's impossible to have a progressive sales tax.
It may not have been done before but it's not impossible, right? You pay 5% on the first 10k you spend in a year, 12% on the next 30k, 20% on the next 50k, etc.
Also income tax/corporate tax isn't work well for import items/services by foreign country. So I think sales tax is a fair good way for taxing, but it's quite unpopular.
You’ll find yourself in a world of hurt working remotely in a country you lack a work visa in. Getting caught is another matter entirely, but I assume they’ll come down on them eventually, probably by offering an incentive to citizens to report them.
Why do you expect them to crack down? The intent of disallowing working on tourist visas is to protect the local labor market. Digital nomads work for foreign companies and don't get location based market benefits that would be restricted to locals (consensus among the various communities seems to be that having local clients was a big no-no), so they add no pressure to local labor markets. In regards to the local economy, digital nomads are nothing but tourists.
Rather than cracking down, the current direction is legalization. Countries where digital nomads are common know what's happening and they ignore it as it's beneficial to them and are now legalizing to get an even larger slice of the pie (by attracting those who were previously fearful).
Others have mentioned the issue of housing stock, but regular tourists are actually more inefficient in that regards (very seasonal and short stays. Think about how many empty room-days most hotels have).
Housing stock is a huge thing. As an expat, working remote, and (legally) living here, the locals can't believe how much I spend on rent, which is still cheaper than I was paying in the states, but far more than any native could/would pay.
The country is likely missing out on (pretty substantial) income taxes, so through legalization they are trying to get some of that. I'm sure the countries enjoy the injection of cash into their economy, but they would rather get that from tourists vs. people working, who tend to use more public resources than tourists.
I'm not seeing how digital nomads have an additional negative impact compared to tourists though. If we're comparing not having wealthy foreigners vs having them, then yes, nobody will deny that has an effect on housing stock, but having digital nomads vs tourists is either a wash or a benefit to the digital nomads.
As for public resources, people who commute for work most likely use more than tourists, but digital nomads doing so would be an outlier.
The differentiation between digital nomads (people on a tourist visa/waiver) vs expats is an important one, as expats do get more entitlements to public services due to their legal residence.
This is a huge part of it; if your group of locals likes you and is on your side, you'll probably be fine.
But if you piss off the wrong person, you could have a hell of a time (depending on the country, even spending time in jail).
And the US embassy may not be inclined to help depending how blatant you were about it.
Luckily, the more likely jail time is the more likely you can just bribe the right person, but again, you need the locals on your side to tell you who that is.
To agree; if you're quiet, don't use up too much bandwidth, parking, or have visitors you might stay under the radar; But maybe you have a rent dispute, maybe you party too hard one night, maybe someone at your pub doesn't like that you cheer for the other team.
You're a blackmail target like anybody else doing something baseline illegal.
It's not. You can't simply employ foreigners, you won't be able to do the administrative work and you can easily get into trouble for employing illegals.
So when companies pay remote workers, they often have a representation in that country. This usually means(depending on the country) that the American company that "employs" these remote workers actually pay money to a company in the poor country and that company pays the local taxes and the workers. There are companies specialising in this, so they setup companies in many countries and when you hire a remote worker from legal point of view the worker actually works for this intermediary and pays local taxes. Another popular option is, to setup your own company and do the same thing but skip the middleman.
When you setup factories in poor countries, that's considered an investment. Again, you setup a local company that is fully or partly owned by the you(depending on the country, there are restrictions) and that local company pays local taxes and operates in accordance to the local laws. When you bring the produce home to sell at American prices, you import that as if you are importing it from any other foreign company.
Well I agree that tax is an issue, and workers shouldn't just relocate without taking that into account, but your argument seemed mostly concerned that they were "exploiting cost of living arbitrage.".
Yet this is exactly what companies do when they employ foreign workers or manufacture in poorer countries and sell those products/services at full price in their home countries.
From that perspective, I agree but the dynamics are different.
"Rich" people moving into your neighbourhood is very different from rich people setting up a factory in your neighbourhood.
Both have positive and negative impacts but for the workers rich people moving into your neighbourhood is almost exclusively negative but if a foreign company sets up business in your neighbourhood its more of a mixed bag.
Exploiting the arbitrage is how arbitrage is removed so it is a good thing in principle, notice how the poor countries seize being poor after rich countries invest in them and produce all the stuff for cheap.
My problem is with the limits on who exploits that arbitrage. Workers are the most limited bunch with very little prospect to benefit from the arbitrage.
Rich people coming to your country and bringing money is tourism. It's often a much better deal for the local population than a polluting factory intent on paying the most meager wages possible; often the reason they're even there, after all.
Nope, Tourism has some benefits but it destroys local communities. In many places in Europe there are movements against tourism. Google for "Tourists go home" and start digging from there. The gist is, only the business and property owners directly benefit from it and the economy created from it often don't offset the troubles it creates to the locals.
Factories are a different situation, they are a necessary evil if we would like not to go back living in the woods. Rich or poor, countries need factories and the pollution they create can and is managed. Not in poor, but in corrupt countries factories can create problems but other than that they are a good thing.
Too much tourism, and the way it's funneled through designated channels, can negatively impact communities, indeed, as everything gets gentrified, and deployed for tourist duty.
Too many factories? An absolute blessing, no doubt. lol.
Seriously, they completely warp and devastate rural communities, which are left with only old people. You can argue that everyone is getting richer etc, but that's not really true. Land prices increase dramatically as foreign 'investment' comes in, forcing people out of the countryside, and into factories just to afford food, which previously they could grow themselves, share, or just forage.
Having a few rich foreign workers around could well be the catalyst for them to realize they're getting screwed and should raise their prices, collectively, and those connections could also be the means to do so.
I also think the 'cost of living' is misunderstood.
In many poorer countries, the cost of living is much lower, because the standard of living is much lower.
To live a western level family existence is often more expensive in poorer countries than in rich countries (probably excl. US), once you factor in security, education, health, imports, etc, etc.
I make money doing exactly that, paying whoever, whatever, wherever.
I don't know how it could be simpler.
Just as you can buy goods from any country via purchase order and pay via invoice, you can do the same with labor.
The only administrative work involved is the rules required of the entity buying the labor. Plus local rules that constrain my personal interactions with the company, if me and the entity aren't in the same jurisdiction.
If I'm in the USA, I have to mind the SDN list, if I'm in Singapore I don't.
> It's not. You can't simply employ foreigners, you won't be able to do the administrative work and you can easily get into trouble for employing illegals.
Tangent: Most countries do technically allow foreign companies to directly and legally become employers in their country without having to involve any kind of additional legal employer entity, and in many cases such branches (as they're called) of the foreign entity can do the required formalities to legally employ foreigners. But yeah, there are usually significant compliance and liability/financial downsides to the branch approach. S most multinational companies do tend to prefer one of the two approaches you describe.
> So when companies pay remote workers, they often have a representation in that country. This usually means(depending on the country) that the American company that "employs" these remote workers actually pay money to a company in the poor country and that company pays the local taxes and the workers. There are companies specialising in this, so they setup companies in many countries and when you hire a remote worker from legal point of view the worker actually works for this intermediary and pays local taxes. Another popular option is, to setup your own company and do the same thing but skip the middleman.
Although you're right about this, the cost to the employer of such an intermediary company is hundreds of USD per intermediated employee per month, nowhere near the typical reduction in compensation for that employee for being in a poor country rather than a rich country. So it isn't the full explanation.
My take is it's honestly mostly just companies getting away with what they can get away with, in the usual economics supply-and-demand system. Hiring obstacles haven't yet forced most companies to change their definition of their labor market into "anyone who can somehow legally work for us (whether directly or indirectly) during work hours that overlap sufficiently with our core hours and without causing us to incur unreasonable compliance and/or travel expenses." They still set compensation using a per-location definition of the market based on who can commute to an office that no longer exists in the context of a remote worker.
Of course, switching to a truly remote-first labor market definition would probably involve paying lower salaries than the current SF and NYC market norms, at least in the tech industry. This makes correct compensation a complicated question for employers, when they recognize the remote-first labor market reality but also want to hire the top-notch caliber of employee who often chooses to live in such major tech hubs. But equally, such employees increasingly want the higher disposable income after adjusting for cost of living that allows them to take a slightly lower salary in other cities or countries and still come out ahead. So this just means that a transition to a remote-first definition would involve some iterative adjustments on both sides as a new economic equilibrium shakes out. We're probably in the first stages of this now.
Last note: It is true that benefits like health insurance and social security contributions will usually continue to vary in nature and magnitude based on local country norms; however, one of the countries where these (especially health insurance) are usually priciest is the USA, which also has the highest salaries, so people who try to use this variation as an excuse for salary differentials are either confused about the data or being disingenuous.
If you’re working remotely in the EU, you are treated like a local worker with respect to taxes etc. this can cause issues if your employer doesn’t have a legal entity in the country, which a whole range of third-parties will solve for a cut until employment and taxation law catches up with the 21st century.
Source: living and working in the EU for employers from other countries for 15 years.
We did an audit and found out one of our employees was logging in from a war zone. He was hired in the US but at some point after being hired, moved to a country that is considered by the US government to be an enemy. For security reasons, we couldn't allow this to continue, especially since he was part of our security organization. We do have contract workers in South America and some "regular" workers in Canada and Western Europe but now we have a policy that those are the only countries where it is acceptable to work from unless special permission is given ahead of time.
I don't necessarily "live" in other countries, but I and a decent chunk of my friends go on extended stays (45-60 days is usually how long my stays end up being before returning to the US) in other countries and I have wondered if this would incur the same tax implications. Technically I'm really just on an extended vacation in my mind but work during normal working hours. So far I also have just worked off of the "don't as don't tell" policy and haven't run into any snags.
My employers security team has even caught on once or twice but I just say yeah I'm vacationing since my stays have usually been along the lines of 45-60 days or so at a time in a given country.
I still have and maintain my home address in the US, pay the rent and everything there, and I do return usually for a month or two at a time. Most of my friends do this as well or have a situation setup where they use their parents address and stay with their parents when back in the US for chunks of time.
This could definitely blow up in your face, as "don't ask don't tell" isn't really a thing. I don't know what the probability is, but I know people who explicitly maintain the 183 day records to avoid it.
On your companies side, it could also create all sorts of problems that nobody is really clear how to handle. I suspect this will get a lot more regulated if it becomes more common.
Generally, getting caught WFH in another country results in immediate termination. For cause, because working in another country creates an entire set of legal, financial, and tax consequences that the employer may not be aware of or prepared for.
If you do everything by the book, it's really hard - practically impossible to do fully legally.
Most countries won't issue you a work permit without a lot of paperwork, cost, and time. Think 'send your passport off to the embassy for 3 months' type hassle...
And most employers don't want to employ someone abroad. Employment law varies widely by country, and unless they already have an office in that country they don't want to do all the tax and reporting stuff for only you.
Long term abroad in one country might be doable, but 30 days in each country is pretty much impossible.
But for example in my case, I do still come back to my home country for decent chunks of time that still adds up to around half the year. I'm working for a US company and every country I have visited thus far mention it's perfectly fine to stay and work for some amount of time (usually 90 days) as long as it's not displacing a local job. I'm not a tax expert or anything but I don't see what the issue is here or why I'd need a work permit in the first place?
Because you're usually on a tourist visa and those will say something about "not working" with varying language. Since your "working" looks identical to "dicking around on a laptop" it's unlikely to draw attention, but if you were to piss off the right person at the wrong time, they might be able to drop a train on you (but even then the most likely thing is being kicked out of the country, but some countries could get very "spicy").
Of course, if you were a rock star coming in to perform, they'd definitely want their cut even if you were only performing for a day. The laws haven't advanced to cover this situation entirely well, so there's a lot of leeway on what you can get away with.
You don't generally need a work permit though, unless you are taking a job with a local employer. Generally they will have rules for how long you can stay in the country while working for a foreign employer. As long as you maintain tax residency wherever you are "from" nobody bats an eye.
If what you really want to do is live and work in one country while pretending that you live and work in another one, I don't see why either country should facilitate that.
It's easy enough to do that "properly" too, form a company or self-employed tax status in the country you are living in, and invoice the company in the country you work for. Then they aren't in a compliance issue and you are paying taxes where you work and live.
Generally they will have rules for how long you can stay in the country while working for a foreign employer.
only if they offer something like a digital nomad visa. otherwise, usually you are not allowed to do any work at all on a tourist visa, even if it's remote work to your home country. nobody cares if you check your work email or do some small stuff, but technically no work is allowed.
form a company or self-employed tax status in the country you are living in
in most countries you can't do that as a foreign citizen unless you have a proper visa for that. you can probably open a company in a foreign country, but you likely still need a work visa to actually work for your own company. otherwise anyone would just go to open a company just so they can live and work in that country.
You are (generally, it's a complex subject) not liable for taxes in a country unless you're resident.
The country where you are resident (or resident last if you don't qualify for residence anywhere in the current year) will want taxes on your worldwide income.
We've been looking at this. We're both in the EU, my partner is from a LCOL country, I'm from a HCOL country, we're both living in the latter.
We've been looking at getting property in her homeland, with the goal to enjoy the better summers there. But for, say 4 months a year. Hopefully enough time that I can start to learn the language and such, and she can enjoy better ties to her family - while remaining tax-resident here as to not rock the boat.
I'm curious what concerns your security team would have? Is it just that you'd rather the situation go under the radar and they're the most likely to spot the changes - or do they have concerns of their own?
Security team was just checking that it was actually me in terms of the location I was in being off. But they didn't make much of an issue after I simply confirmed that yes this is actually me.
But outside of that one time, I basically don't disclose where I am.
My GF isn't tied to a location since she does mostly freelancing/contracting and makes it known she will not/should not be expected to be in a single location and gets away with that just fine. So I basically just started joining her in her travels the past few years.
I'm pretty set in that I would simply quit if my company ever demanded I go back home and stay there.
Well that sounds like a personally sensible concern on their part.
I'm not sure going back to the office would be the end of the world for me, but I can see which way the wind's blowing - we're already in the process of downscaling the site because the demand just isn't there. I believe the most we've had onsite since this all began was approx 15%.
The position I'm in - my GF wants to eventually move back home, neither of us have family here, the wage is our only tie. So it's seeming completely logical to me, to use our new-found flexibility to ease that transition for both of us. We've always figured on retiring there, but a head-start on the language and the property ladder make sense to me, and being closer to her family for a third of the year instead of just christmas, is a huge win for her.
All the news seems to focus on people wanting to use this to live the high life. Just wanted to share my position to show there's some huge non-monetary value in this too.
How about insurance. On work I guess you are insured. But if you have an accident somewhere else, what then.
In Switzerland there had been cases with, where the insurance wouldn't pay (broken leg after falling on stairs), because some parts of the house do not count as WFH.
I have been wanting to build a POC of a vpn product where you buy a kit with two little boxes that are plug n play:
One you plug into the network in the location you are supposed to be, and the other you bring with you on your travels and plug your computer into over ethernet port. The one you bring with you can connect to any wifi or be hard wired. It has one job: tunnels all your data through vpn to the other box you left behind.
Does this exist? Seems like there could be a market for it now.
It would be easy enough to test it out if you had a sales channel in mind: give it a shot and if somebody wants to buy one, slap together something with Wireguard and two Raspberry Pis and build from there.
The main problem I see is getting steady access to qualified leads, since I would assume "remote workers who are trying to hide that they are in the wrong country" is a particularly difficult cohort to track down reliably to market to. Honestly, if you could detect such people at scale, selling your system to HR departments may be a better business.
Seems like a VPN with extra steps? It allows me to travel but I also have to have an apartment in the place "I'm supposed to be" to leave a little box plugged in?
There's plently of VPNs that offer unique IPs, or mobile/LTE IPs to connect to, you don't necessarily need to connect to a datacenter or an "abused" residential address.
But there's a potential for a business here: rent small spaces and offer to set up the small boxes for a fee.
The problem with a server is that it's detectable based on the source IP - if your employee suddenly starts appearing from a datacenter IP you might have to ask questions.
This box allows them to build a virtual network cable back to their usual, residential connection - completely invisible from the other side (besides latency, but this can be explained away).
You can simply run wireguard yourself, no devices needed other than your laptop and a server in your home.
You can run wireguard on a raspberry pi (which are hard to source these days) or something like an HP SFF workstation which will run you ~$50 on ebay. Both of which are useful for other things asides from vpn tunneling.
Not quite as simple as "two boxes" but there are a bunch of 'travel routers' that have vpn clients on them. They're totally transparent to your devices and your home router probably has a compatible vpn server on it.
What you're describing is just a router + WireGuard. I have a server with WireGuard that acts as an exit node in tailscale network and RPi with WireGuard that acts as SoftAP that routes the entire WiFi network through that WireGuard connection.
For this solution to be truly plug'n'play you need to figure out how to punch holes in NAT. Tailscale has ways of connecting two nodes even if both behind NAT and block UDP.
Pretty sure online poker players did a reverse version of this after it was made illegal in the US. They have a proxy out of the US, which they log into to play from inside the US.
Yes, the easiest way to do this is buying 2 routers that support a VPN server and a VPN client. Any OpenWRT capable router should be able to do this for you, gl-inet built a business by selling routers with custom OpenWRT-based firmware with a streamlined UI for exactly this: you log-in go to the tab for configuring the OpenVPN/Wireguard server/client and you have yourself a private tunnel.
I work for a very large FAANG-type tech company. I am also a dual citizen, having US citizenship and a South American citizenship.
A few months after the pandemic began, I relocated from my high CoL work city to a small South American city where my relatives live. I told my manager I was moving to another US state, which is my official address and where I also have relatives.
It has been almost 2 years of this arrangement. In that time I believe exactly 0 people suspect I’m in a different country.
I’m only somewhat careful with my arrangements. In video chats, I use a background blur and try my best to have neutral lighting. My audio setup focuses only on my voice and eliminates background noise.
I don’t take special networking precautions yet. If they check their logs they’d easily see my true location. However, I subscribe to StarVPN and I have a glinet router ready to go should I need to start spoofing my digital location. I have full confidence this will be enough.
I pay ALL US taxes that I owe. Due to tax laws in the SA country I’m in, I have no reason to suspect I’m avoiding any taxes here either, but I’d have to consult with an accountant or expert to be sure.
I’m not at all worried about my situation. I have yet to hear of a single case of someone in a similar position as me having it go south in a bad way. If my employer insists I go back to the US, I can spoof my location with the method I described above. How would they prove where I am otherwise? I’ve also been playing around with the idea of quitting and traveling a while anyway.
I consider myself a very effective and productive engineer, and I subscribe to the “don’t ask don’t tell” policy in this situation. I’m surprised to see so much fear mongering and thinly veiled contempt for this here in HN. The total number of people doing this is likely extremely small anyway.
Do know that if and when they do, they'll question your StarVPN IP. Time to pay someone you know to keep a second glinet router in their home in the state you're supposed to be in.
From the employers perspective the easiest way to get around this is hybrid. Though I sympathize, between this and the whole "I'm going to work multiple jobs concurrently" - it seems the relationship with employers will become even more adversarial than it already is.
So what I'm getting out of this is that the next time I'm on vacation out of the country and my employer calls to ask an 'urgent' question I should definitely ignore it so he doesn't get in trouble with the IRS.
At the first chance I could I moved to South East Asia while working a remote job in Europe. Employer was not too stoked. But then found a new employer, which was absolutely okay with me living there. There is A LOT to the story which I'm not mentioning, but it's been the best decision or my life. I'm also meeting more and more other people here which are making the same move. Many of them who haven't yet told their employer that they now live 5+ different timezones away.
I'm now working for a local software agency which contracts my clients for me. Through them I've been able to get my work visa/permit. Took me some time to arrive at this point.
It's a one-off mutually beneficial agreement. They provide me with the structure, and some chance for networking, along with an office I can work from. I do some consulting for them every now and then, and they take a small fee from every invoice (<10%). For the work visa and permit, its more than worth it. I came by the chance through networking locally.
US/Western capital has maxed out every kind of cross-border international tax "savings" you could imagine - it is so well known that Saturday night television comedians can joke about it and people laugh because they know what it means.
Now that some thousands of tech workers get tax-cheating benefits, it is the subject of solemn hand-wringing here? I call BS
tax and compliance concerns are very real. employees need to be transparent so they can personally shoulder the overhead of additional compliance along with all taxes incurred.
I don't disagree, but I was in a situation recently where I needed to WFH from another state for family reasons. I was very honest with my employer about what was happening and why, and gave it plenty of notice.
The company wouldn't allow it, for very understandable tax reasons. But my family is more important to me than any company. That's the way human beings are supposed to live their lives.
I ended up resigning. The week before I moved, my boss left me a voice mail asking if I could hold off on my job search because the previous-inflexible directors of the company were going to try to work something out. Eventually they did, and now allow anyone in certain positions to work remotely.
It turned out that the company had lost several other employees in the previous weeks over remote work, and based on the long list of open positions on the company's web site, it's having trouble replacing people.
This is the only time in my life when a good number of employees have had more sway over their jobs than their bosses. It's good to see people everywhere taking advantage of this (in a good way), and leveling the playing field with their companies.
Employment is a two-way street. It's not servitude. This is a once-in-a-generation opportunity to alter society in a way that favors people over profit.
Registering for payroll tax in another state is generally very straightforward, and carries minimal additional income tax consequences (unless the employee at issue is an executive).
If the company uses a payroll services provider like ADP, it really is as easy as having the legal department register for payroll tax (and unemployment tax, if that is a separate registration in that state), a roughly 15-30 minute process, and providing the relevant ID numbers to ADP.
It's not just about payroll - there are all other kinds of employment-related laws that must be complied with which are set at a state level. For example, minimum required vacation time, sick leave, minimum wage, employment contracts (e.g. restrictive covenants), required reimbursement for employment-related costs.
A lot of those laws don't kick in if you've only got a single employee in-state; there is usually a threshold before an out-of-state employer is subject to those laws. The threshold is usually 10 employees, but it varies by state, and can even vary by the size of the employer, so I left this out.
However, payroll compliance and unemployment kick in with a single employee. There is no minimum threshold.
It doesn’t though: profits for lots of companies during the pandemic were at all time highs, as was productivity. Remote work favors people who deliver, and not those who play politics or like to use the office to keep up social appearances!
So both profit and people are addressed by more remote work!
Can someone ELI5* the major reasons a large employer would want to enforce return-to-office? Some other comments touch on tax laws for domestic/foreign work, but why by in the office at all?
(* sorry if wrong forum for this acronym)
For many companies the transition to remote during covid was a massive drop in performance of their staff. For developers, IT and the like, most of us had some experience, if not had already transitioned, but in those industries that hadn't, it's easy to look at those two years and say "this was worse".
Unless your company is VERY focused on remote staffing, collaboration is just easier in person for most roles. Add in time zone differences and it gets even more difficult.
Some people are bad at working remotely at home. Especially if there are distractions in their home office. (Like my wife, my dogs, my daughter, etc.) It can be hard to get others to take working from home seriously. I've gone as far as to rent an office for myself to go to every day.
When remote becomes a possibility, the idea of living elsewhere soon follows for many people. (as in this article) Even without crossing national borders, many US companies have tax and legal implications across state lines. Even supporting benefits for employees becomes more difficult as almost all health insurance networks are state based.
There are no doubt a thousand and one people that could reply "But not me, why should I change" but the simple truth is many people are easier to get higher quality work out of in person in an office, and an office is easier to manage than a distributed workforce.
> For many companies the transition to remote during covid was a massive drop in performance of their staff.
This was the expected outcome, since most companies hadn't prepared at all for a multi-year global lockdown. However, my understanding is that even companies that had very little preparation handled the pandemic absolutely fantastic, and other factors were much more important (supply chain of physical goods, jobs that could only be done in-person, reduced travel and leisure etc). If productivity dropped for white-collar WFH type of jobs across the board, I think we would never hear the end of it. Instead, the media zeitgeist is blaming the "anti-work" culture, that people aren't taking minimum wage jobs anymore etc. It's definitely not the narrative I'd expect if "WFH=low productivity" were true.
IT is easier when everyone is in the same place - for example, fixing a person’s work laptop or updating software. Workers compensation is easier to manage, for example if someone is injured on the job. Finally, as much as the knowledge class hates butts-in-seats as a metric for performance, it is easier to tell “how” your employees are doing when you see them every day. Especially when you want to check if someone is burning out.
In my view, both sides of the RTO divide have failed to adequately acknowledge the pitfalls of their own position, which has led to this topic being unnecessarily polarized.
If managers are making time to interact enough with their employees day to day to actually assess burnout, then they can make the time to have zoom meetings with their team. Its no different. Funny you cite IT when that line of work especially is basically 50% remote work if not more of just controlling a users device remotely to fix software issues. Hardware issues you could just mail out/in gear to one site. Probably a whole lot cheaper than having a dedicated IT department in each and every office you have around the globe.
The company pays for that office. Maybe they own it, maybe they lease/rent it. If it sits empty, then it is a non-performing asset and they need to get rid of it. Or shrink what part of it they rent until there isn't any "wasted" space.
Cities depend on property taxes. If all the offices suddenly stop being used as offices, they're going to have a terrible time. Nobody is paying taxes.
Commercial real estate is over built. If too many companies decide that they don't need commercial space anymore, then the market is going to collapse. Every one who borrowed money to build/own commercial real estate is going to find their bubble getting popped. Like the 2007-2008 meltdown in residential property.
If commercial real estate gets re-valued to reflect the newer, much lower, need for that space, then asset values fall through the floor. So anyone who still is paying taxes will be paying much lower levels of taxes. More bad news for cities.
Too many managers depend on people sitting in chairs. This is usually called "presenteeism". Part of the problem with presenteeism is that people feel forced to show up to work even if they are sick. Mismanagers usually don't know what you do. Or how to measure whether you're doing a good job or not. But they can see whether you're at your desk or not.
Manager empires are based on the number of people. If all of your minions are working from home, then other mismanagers cannot measure your status any more. Likewise, this leads to why many mismanagers pad their staff so that they can appear to be more important. Unimportant managers don't get "good" parking spaces, nor good corner offices. Nor do they get admiration from the other mismanagers.
- It isn't just middle managers who use "seat time" as a proxy.
- Businesses often sign 10+ year leases and commercial real-estate is EXPENSIVE. With a long term lease in place how do they justify the rents while the space is vacant?
- Many senior leaders are required to be in the office, so naturally you need to be there too.
The one that hasn't been mentioned yet is that the flip side of "managers want to see their people" is "managers' jobs are much harder in remote positions."
It means that every meeting is via zoom. That's great for 2 hours a day. It's terrible for 6 hours during a meeting-heavy day. (Consider a manager with 15 reports that meets with 2 tech leads half hour weekly, a manager for half hour weekly, all ICs for a half hour bi-weekly, and has 4 hour long manager screening interviews a week. Team rituals usually take about 4 hours a week; anything else has been moved to email/slack. That's about 16 hours a week base load. Every single one of those, and every other meeting, is either on zoom (exhausting) or writing up an email (which takes 2-3 times as long as having a meeting.)
On top of that, performance management is more difficult. For great and average performers, it's not that different. However, it's much harder for low performers because it's bad to offer feedback async. So, things that should be a five minute conversation in an office turn into having to schedule a meeting. It also means that we have to rely on metrics more as well, and everyone here knows how bad metrics are at judging performance.
The problem amplifies for senior management. You lose the rewarding parts of the job and the parts that were positives turn into drudgery or negative.
I work remotely. I choose to work remotely because the positives outweigh the negatives, even as a manager, but it is a harder and less rewarding job remotely.
Many reasons but the two that seem to be the most common are that managers don't feel comfortable evaluating employees on output rather than time their butt is in a chair and many people (ICs and management alike) use the office as an outlet for their social needs. Perhaps the third reason, though less common, is the belief that the best ideas come from hanging out at the water cooler.
It feels like all that extra work/stress to hide the deception would cancel out any benefit from being in any remote location, even considering the monetary/payroll arbitrage.
0 stress or effort needed. But your purchasing power goes up 15x. When you rent a 3 bedroom beach house in Turkey for $450/month and the rest of your expenses don't exceed $1k but you're still getting 6 figures...
I can't wait for the frictions to loosen and this effect to work IN THE OPPOSITE direction. Workers in mostly wealthy country are taking advantage of a cost of living arbitrage, but soon employers will figure out they can take advantage of cost-of-worker arbitrage, meaning there is some local in the foreign country your current employee is in who could also probably do the job but for a fraction of the amount of money.
> meaning there is some local in the foreign country your current employee is in who could also probably do the job but for a fraction of the amount of money.
This sounds like the same tale we heard in the 90's, that software would be offshored to Asia and there would be a handful of people writing specs and overseeing work and not much more.
As the saying goes 'you get what you pay for'.
If you have talented people anywhere in the world, they have either already emmigrated to higher paying markets or are contracting locally at absolutely fair prices in an international market.
The sort of scenario you describe would have been true with information assymetry. However in the connected world of today if you think that someone is talented enough to be an effective asset but naive enough to not know their rate in an international market you are in for a surprise.
It's not a matter of hiding. Companies do not want to know.
I guarantee that in many (likely the vast majority) of these cases someone in management is aware and is pursuing a don't ask don't tell policy because they don't want to deal with the fallout.
It's extremely common to work while on a visitor's visa in another country, for example. I bet there is not a single manager reading this comment who has not had one of their employees send work emails while traveling internationally on a visitor's visa.
I have several friends who are doing the digital nomad thing, working all over the world while ostensibly traveling on visas that prohibit work. If they officially asked HR, HR would be forced to officially tell them to not work. But they're never going to ask, and their direct managers are never going to report the situation.
I know of several situations as well where the employee moved. The company response is pretty much universally "you can't do it so please don't tell us about it because if it's ever put in writing we have to act on it"
> It's not a matter of hiding. Companies do not want to know.
If a company doesn't want to know you shouldn't be doing business with that company.
Sure some of these cases are John Doe wanting to live as a secret expat but not all.
In a remote world, you have to know. There are numerous fake employee scams that have a number of different outcomes that present exactly in this manner.
1) Steal or forge a decent looking identity.
2) Have a face that interviews and attends some of the early weeks on camera then slides back to off camera
3) Profit whether it's theft or double-dipping or code farms
This isn't a pretend scenario. It's active.
Depending on your vertical and internal zero trust architecture a breach of this nature could be devastating.
So sure, maybe that employee is lying about their location to soak a big salary under a cheap cost of living but maybe they are something much darker and you can't leave that stone unturned.
Within the EU, it would likely be considered an invasion of worker privacy (indiscriminate screening of where employees are logging in from).
Even if it weren't an invasion of privacy, as you say, companies want to be able to point and say 'look, we have a policy, you aren't allowed!' and blame workers for breaking the rules rather than trying to solve the (admittedly complex) tax regulations about working outside the country you are normally employed in.
Not to the country you’re visiting. I had to attest to the German government that I would not send any emails or write any reports on my recent work trip there. Else, I needed a work permit.
They're degrees of the same thing. In my experience companies don't want to know about it if at all possible.
In some cases working on a vacation is a more serious issue - I have heard stories of employees remote working from sanctioned countries and employers finding out after the fact.
My point is that it's typically not a cloak and dagger situation described above, with an employee going to great technical lengths to hide their whereabouts.
Generally speaking, the immediate manager is aware and is pursuing a policy of willful ignorance. Often when rumors percolate to HR, HR will very quietly say that they don't want to know and to clean it up so they don't ever have to.
I don't know of any companies attempting to actively document this kind of thing. They don't want to know, and they'll only respond if they are forced to acknowledge the situation.
Potentially the case, but this article was about two people who were going to great lengths to hide their whereabouts from their employers.
> I don't know of any companies attempting to actively document this kind of thing.
Well, not all companies tolerate casual lies, especially those that impact tax liability. At my organization, you'd be terminated for any willful lie in an instant based solely on a violation of trust... even if it didn't open the company to any tax or legal liability.
Certainly the official policy is that you'll be terminated. Almost every HR department would say this if asked.
Reality is often different. Companies are diverse collections of many different people with a diversity of incentives who all enforce policies in very different ways. When these things happen there are many layers of management who will more often than not try to avoid the problem.
Maybe at a large org. I don't work at a large org. There is no difference in official policy and effective policy in an org where they are both controlled by the same person (or by a few people who closely agree)
Also, there are larger organizations where matters of trust are a critical part of the job, there are operational safeguards in place to account for lapses in trustworthiness, and concerns surrounding this are taken more seriously.
No; they're not. Intention often matters in immigration. If the purpose of your stay in a country is tourism, that is one thing. If the purpose of your stay is to work remotely then that is a different thing.
Your original reply was to a post saying: Sending an email on vacation is one thing. Setting up residency is something else entirely.
Those do not have the same intention. In the first case, the email is incidental to the vacation. In the second case, the purpose is to work (which defies the claim to be "on vacation" in the first place).
No-one is confused about whether they're going on a foreign vacation (taking vacation time, telling their colleagues they're not going to be available etc) and handling a few emails vs. setting out to work remotely from another country that might have a superior climate. The suggestion that these are the same thing based on observing that both involve work email in a foreign country is pretty obviously ridiculous.
If you tell the immigration officer at the border that you're planning to work remotely with your tourist visa, they're going to put you on the first plane home.
That can be bypassed by using a residential/LTE VPN. They're not as easy to get a hold of as regular VPNs, but if tens of thousands of dollars on the line I think tech workers can manage.
Or you know just having a small room with a server rented that you ssh or vpn through.
I think by the time an employer gets into such arms war with the employees, it’s time to have a hard look in the mirror and see where the CEO is working from.
I found that a little surprising and upsetting about CloudFlare for example. The CTO is working from a beach town in Portugal but regular employees are bound to a physical office. And this is 100% ‘cloud’ company where all your work is logging in remotely anyway.
I found that a little surprising and upsetting about CloudFlare for example. The CTO is working from a beach town in Portugal but regular employees are bound to a physical office.
Well, that's a pile of shit and completely false. Everything about that is false. I'm in Lisbon not some "beach town" (unless you're counting the capital of Portugal as a beach town). Employees have a huge amount of flexibility on using the Lisbon office or not.
And this is 100% ‘cloud’ company where all your work is logging in remotely anyway.
Not so sure about that. First meeting I have tomorrow morning is in person with member of the team in Portugal in the office. It's true that I have a lot of video calls, but not really a surprise given that Cloudflare has offices all over the world. We have more than 200 employees in Portugal and I'd guess around 40 in the office at any one time.
If you ask your employer to work from Lisbon as opposed to SF, you'll likely get a 3x-5x reduction in total compensation. I doubt Cloudflare (or any other) CEO's compensation will get the same readjustment for cost of living if he moves from the SF office to the Lisbon office.
Then find an employer who thinks the same way. If you agree to work for a company that says "your place of employment is X" then you'd better be OK with that. Anything is just rationalization.
People in tech have already been doing stuff like working three jobs at once for decades. Sometimes these people will comment on here how they do all this juggling in their careers and keep each employer blind to the other. It's old hat that the tech worker will develop a way to squeeze more money out of their employers. Should be expected at this point.
If you set up your entire home network to tunnel back via the VPN, it's basically bulletproof. The failure mode would be "no connection", not a leak via the local, non-VPN'd connection. You can even maintain an actual air gap between the 2 networks with one device that handles the tunneling and exposes an ethernet port that's only ever bridged to the VPN interface, and the normal router's WAN port connected to that.
I have such a setup - the local connections at the end-user sites are inexpensive consumer-grade connections (because they are cheaper and quicker to set up than a proper leased-line which has months of lead time, and you're not going to convince small restaurants/coffee shops that they need to spend 500 bucks/month for a leased line to serve public Wi-Fi) with various bullshit such as filtering, dynamic IP, etc - but the network hardware tunnels back to my infrastructure and abstracts away all the intermediary connections, giving them a "clean" Ethernet port. As a bonus, it can tolerate intermediary connections failing without dropping in-flight TCP connections, since those run over the tunnel rather than the raw interfaces which have gone down.
There is a difference if it is your own vs corporate hardware: MDM can enable wifi remotely, then do a location scan against wifi networks nearby (ostensibly this is for theft purposes)
If you really want to do this and fool wireless location, I wonder if a client running at the "real" location can run something like airodump-ng and send the received (B|E)SSIDs to the remote end where a fake AP spoofs them. You don't actually need to break any crypto to do this, simply broadcast the same networks with the same security parameters (even if the key itself is different). Signal strength will be an issue but it's probably still good enough to fool the system into returning an inconclusive result. Tampering with the wireless card to prevent it from receiving anything is also a solution.
You would have to be in the stone ages not to heard of VPNs or believe that the origin IP is correct. But maybe I like that you exist.
I've helped a few remote workers with this setup. Always a stable VPN - be careful some of the low cost ones - any lifetime bullshit deals - anything listed on stacksocial - anything less $5/m - they change their IP registrations so even if you are connected to SF one day it shows correctly the next the day it shows Pakistan - use something like Mullvad or better yet Tailscale exit node from a stable VPN provider in your specified location of working - heck just setup tailscale on raspberry PI at your parents/friends. Modify route tables so you never hit the web unless connected via VPN, easy on some Asus routers.
Adjust the time and TZ on your PC to place of registered work time,that web based homebrew HR system could be doing something crafty .
Deep latency hacks - use RDP from place of registered work
The article details the levels of active deception that one of these covertly-overseas employees has gone through, involving virtual environments and VPNs. The rare employees that are this determined are probably more determined than a compliance officer.
I don’t understand why “Matt” would talk to the press if he truly wanted to keep his deception secret. Because once he gets caught and narc’d on by his employer for obtaining a visa under fraudulent pretenses, with this article as evidence, his travel options are gonna get limited.
As a WFH employee for a small company which has no office, I've booked 3 months total of lodging in Spain, almost done with month 1 and have done 1+ months in Peru.
I'm more productive on some days, less productive on others, and overall, I'm pulling ahead in terms of productivity life satisfaction, and travel experience. Down on money, but to me personally, it's worth it.
This is just another ploy to get employees back to offices. One thing I don’t understand is the tax implication and where you’re allowed to work from.
I’m based out of a company in the US that was proactively working towards remote environment before the pandemic. One thing that struck me as odd was that even within the states I would be technically illegally evading taxes if I worked from Nevada for instance - for a month let’s say due to need in change of scenery. Even with a country I cannot technically and legally be remote.
The laws need to change here are the antiquated tax laws. I don’t understand how if I want to work from Florida for part of the year to avoid the winter is a tax / insurance liability for me or the company.
The last point really hit home for me. What if you have family abroad - either healthy or otherwise - and you want to spend more time with them. would these companies want be to take one month off or rather work?
I understand that people using this to move permanently is a an issue. But the people that have a permanent base but would like to occasionally work from elsewhere need a better framework and set of laws. The physical borders don’t make much sense in a digital world.
> One thing I don’t understand is the tax implication and where you’re allowed to work from.
You do understand that's basically the entirety of the thing, right?
And the tax and legal liability is NOT just on you, but on your employer too. It's not that they legally have to know where you are as such, nor that they care, but that in order for them to follow laws they have to know which laws apply.
> The physical borders don’t make much sense in a digital world.
Yet that would be hard to argue when you get caught with weed in Saudi Arabia, or when the french police knock on your digital nomad door in south of France.
At some point this becomes like the "sovereign citizen" crowd, and their "your laws don't apply to me" don't tend to work out very well.
This is way more complicated than most of the comments imply. It's not only about your taxes, but about the company's payroll taxes, and also other regulations and services. First of all, it's a unique thing about software engineering that you can get away with working while living in another country and pretend that "well the work is for a US company and I pay taxes in US so it's ok" or "I don't have a work visa in Japan[1] but I'm working for an American company from Tokyo so it's ok". If your work is swinging a hammer, it's more obvious, but in reality tax generally treaties specify that work done in the country you reside in, whether by hammer or laptop, is taxed in that country. Because you enjoy the services from that country.
One example is raising kids in country A while you are employed by country B. OK, you pay sales tax and maybe property tax in country A but country A is expecting payroll tax to help pay for education, and healthcare fees based on your income to help pay for healthcare.
Another example is insurance. If you work for google you can probably sue them when your WFH desk bought with inadequate WFH allowance collapses and breaks your ankle. But does google's insurance cover the case of working in your summer home in Iran, or is able to make a payment to an Iranian hospital? Not likely. At least it's a moot point compared to the embargo violation and export control violation that now comes to light.
Another example is just legal stuff in general. "Work" in US and live in Spain? What's the legality of the NDA you signed? What's the process to fire you? Who knows, but a company sure doesn't want these uncertainties times the number of countries its remote workers are located.
Mature companies know all of this and put rules in place and either open a proper office when it's justified or hire a middleman company who then hires the remote worker as a contractor.
[1] I use US and Japan specifically because I just finished a 10 year stint in Japan and well, it's common online to see Americans living in Japan on a marriage visa or something, trying to get remote/American salaries and totally missing the basic requirement: work done in Japan is taxed in Japan and also subject to other Japanese regulation. So not only can you be in trouble for not paying taxes in Japan, your company can be in trouble when it realizes that by paying an employee in Japan, it is also bound by Japanese labour law. My understanding is that this works similarly for most country pairs.
There are also additional issues with this arrangements.
For example, social security payments. Pension plans, etc.
A simple example, Israel has mandatory pension plan requirement for all employees. If you are working remotely in Israel "as if in the US", you are now opened to a whole bunch of interesting questions. Employer isn't aware of that, in this scenario, so isn't paying the pension.
That creates:
* criminal liability for the company
* criminal liability for the management team personally
* the company is assumed to be "self-insured" and basically has to act as the pension provider for the employee.
You fall down and become invalid at the age of 27? The pension insurance will pay for that. Which is basically the company. Then you have to pay 60+ years of pension payments to that employee.
And that is _one_ aspect of this issue.
Others are related to laws. What is the minimum wage? How do you compute the allowable number of hours and overtime pay?
For fun, let's say that you are working for a few years in this mode. The employee then sues the company for overtime pay (200%) because that is the law where they are working.
Firing someone, also, is a totally different process across jurisdictions. In Israel, you have to pay a month's salary for every year that the employee worked for you (based on the last 3 - 6 months).
You have to fire a senior guy that worked for you for 6 years? Prepare to pay immediately a big chunk of money.
Also, have fun with _another_ criminal liability (for the company & leadership) because you didn't pay insurance for this scenario.
The company in this question is going to be absolutely against this sort of exposure.
For that matter, it isn't even legal only that is going to object. If you are a public company, you need to put things like "liabilities in case we have to fire people" in the balance sheet. The CPA is going to have a field day with all those undisclosed issues.
If you're able to fool your complete working space, I think there's something wrong with you. I couldn't do this without losing so much sleep, it wouldn't even be healthy. Just be open about it? Also, this article smells of corporate manipulation.
The media manipulation is obvious at this point. The quiet quitting meme is perpetuated as part of anti-WFH sentiment as well.
It is clear that there's a power struggle playing out, where the Powers That Be desperately wish to pretend like Covid never happened, and the world never changed.
Capital looses so much from people working from home.
Easiest to notice is property values. They own or rent huge buildings that will loose value as the need for them decreases. That is capitalism 101.
The bigger loss for Capital is leverage and control. If the employee is no longer bound by the shackles of working at a location, they loose the ability to pay them less, to lord over their time, to dictate their needs and will onto their employees. Suddenly Capital is forced to compete non-locally in a way they never had to before.
- People's attempts to hide their remote lifestyle are mostly laughable. You don't need sophisticated tooling to know that someone isn't where they say. I see you every day. I can recognize patterns. I can see the changes in work hours, response times and just general behavior. I can tell when you have just rolled out of bed with a coffee or come back from the club.
- Most managers I know don't give a shit. In fact we'd rather not know at all. It's really HR you have to worry about (and I'm not going to tell them unless you give me a reason to).
- HR itself only cares because of the tax implications. Inter-state taxes are bad enough, figuring out international ones are basically impossible. The company can get into major trouble if they are not following local employment laws, and "I didn't know my employee lived there" isn't a good enough defense.
- For those saying "IRS will come after you", these remote employees are paying full federal, state (mostly CA), payroll and various local taxes while using none of the benefits. The government is probably ecstatic that such people exist.
- The government on the other side is the one you really have to worry about. Locals in Mexico City, all over South America, Bali, Thailand, Vietnam and really all over the world are pissed with these "digital nomads" (read: illegal immigrants) who work on tourist visas and upend the local economy while paying no taxes. It's only a matter of time before they all start cracking down.