
Ask HN: Digital Nomads: How do you manage taxes? - foobazzy
There is a brewing possibility that I might come across a remote position. I wanted to take this opportunity and travel a few places around the globe. I am planning to start for a few months in my home country and then make the move. But I am not sure how the taxes and other financials work if I am moving around different countries every 2-3 months(or whatever time is ideal). Hence I wanted to start a discussion on the following:<p>-  How do taxes work in this case? Am I supposed to be taxed based on my home country, the company&#x27;s home country or the country I am currently residing in? Are there any services that do this for me?<p>- What kind of visas do you apply for? Business-tourist?<p>Thanks in advance.
======
hackerboos
Visa-wise. Very few countries let you work remotely, most do not.

Canada for example says right on their immigration website that if you are
working for a company not based in Canada and are paid from outside of Canada
then there is no problem.

Thailand, and most of South East Asia frankly, have laws on the books that say
any work, including volunteer work, is work and is forbidden. Thailand has
however stated some years ago that 'Digital Nomads' aren't their concern, just
illegal workers. There have been arrests in shared work spaces but people were
released after. Definitely a grey area.

Singapore's another example but you can count on them to enforce the law to
the letter.

That's an uncomfortable truth you don't see people talking about on the remote
job boards.

You don't read about many issues because nobody is going to know that a guy on
his laptop is working and not uploading holiday snaps to Facebook. I'd
personally avoid coding camps, shared workspaces and collaborating in person
if I was going to skirt the law and do it anyway.

~~~
derekp7
I can see the desire for a country to control who works for companies in the
country, as that takes money out of their economy. But if someone is living
there and bringing in money from off shore, and spending it there, that seems
like it should be encouraged as there is no local resource drain, and a local
economic benefit. Anyone know why this is frowned upon?

~~~
adewinter
I think 'spending [money] there' is maybe not quite enough. Taxes pay for
infrastructure maintenance, law enforcement, fire, public safety concerns,
etc. If you're not being paid by a local entity and do not put the money in a
local bank account, it's really hard (for the local gov) to figure out/prove
how much you should pay in taxes. Basically you might be a drain on resources
and the community if you don't pay taxes, even if you're spending some money
there. That's likely what they are trying to avoid.

~~~
devoply
Well tourists are similarly a "drain" on the economy. Yet they are welcome.
Logically speaking, they are as much as drain a "digital nomads". For the
period they are there they use as much infrastructure as digital nomads. Yet
no one thinks about taxing tourists.

~~~
ska
You are oversimplifying things. The two are only equivalent if the average
daily spend on tourism related activities is the same. After all, taxes, fees,
and jobs (and hence taxes at one remove) are generated in these activities
with a specific eye to counterbalancing the "drain". The goal is a net
positive effect.

If you are minimizing the amount of money you spend while doing remote work,
you may well be on the "wrong" side of this balance, from a revenue point of
view.

~~~
devoply
Back packers are a similar category. They live in hostels and spend minimum
amount on tourism. They are still tourists by every definition of the word.

~~~
ska
Obviously - that's what I meant about a "net positive".

It's reasonable to expect you can find individual tourists who use more in
infrastructure than they contribute to the local economy - the system doesn't
break down so long as the average case means overall it is significantly net
positive.

If "digital nomads" are net negative, then I expect you'll see eventually
constraints arise. Assuming long enough for a) local governments to figure
this out and b) that it's a big enough impact to care about. It's also
plausible that "digital nomads" remain such a small number of people that
nobody is really fussed about the impact, and the legalities of what they are
doing remaining fuzzy is only used as a justification to refuse visa/entry to
anyone who has proved annoying to the people who issue same.

------
kalleboo
The reality is that most countries don't have visas to support the "digital
nomad" life and you will either be working illegally under a tourist visa
(everyone I've met), or spend months trying to get work visas and be rebuffed
everywhere because you don't have a sponsoring employer, self-employment
business starting capital+business plan, etc. And if you're there on a tourist
visa, there's no way for you to pay tax.

I've seen two setups among people I've met who are doing the digital nomad
thing: Either they are tax resident in their home country (wherever they
started) and pay their taxes there, or they told their home country they moved
out and they pay taxes nowhere. This obviously depends on the laws for tax
residency in the country you're coming from (some depend on # of days in the
country, ties like owning property/a business, etc). Traveling around inside
the EU is also an exception.

Re: the visa thing. For instance if you tell US border control that you're
going to be doing productive work, they WILL turn you back on the spot. Either
get comfortable lying about your intentions or you will severely limit the
countries you can visit.

edit: one more thing, everyone I've talked to as a digital nomad makes sure
their status is as a contractor. If you're on payroll as an employee things
instantly get more complicated, especially internationally.

~~~
davimack
Responding to the contractor vs employee thing: I've run into people who
manage to remain employees while doing the digital nomad thing, but they
maintained "residency" back in their home country. It just requires that your
employer be in your home country, not elsewhere.

------
ashray
I've been a digital nomad for almost 6 years and have written in great detail
about this subject here: [https://bkpk.me/digital-nomads-
tax/](https://bkpk.me/digital-nomads-tax/)

The gist of it is that it depends a lot on your citizenship, the kind of work
you do, and how it is all setup. Normally, taxes are to be paid where the work
is done if you are a tax resident in that country. Interpretations vary so
most nomads are on tourist visas and just fly under the radar. There is no
proper framework for this kind of work yet. Even if you wanted to pay taxes in
a country you're visiting it would be impossible in many cases because they
wouldn't even issue a tax number without proper residence papers. You should
be most concerned about your home country and speak to an accountant about
that.

~~~
devoply
People on tourist visa by definition are not residents or citizens. They are
tourists. You can't tax tourists. Imagine how many people would avoid certain
destinations, I mean executives, if this was ever an issue. Many people "work"
while being tourists. It would be difficult/impossible to force them to pay
taxes for the weeks or months they spent in your country.

~~~
atemerev
While it's still complicated, many countries use the notion of "tax resident",
usually defined as "somebody who spend more than 180 days / year physically at
our territory".

While it doesn't help US residents, as they have to pay Uncle Sam wherever
they live, many non-US people are using this loophole to avoid being taxed
anywhere. Just find 3 countries with residence-based taxation, avoid staying
more than 180 days in a year in any of them moving back and forth, and boom!
Zero taxes.

(YMMV, IANAL)

------
davewasthere
When I moved to Dubai, I declared myself non-resident in UK for tax purposes.
Dubai was tax-free. Now I find myself resident in two countries for tax
purposes and paying tax in both. But I've mixed feelings about it. I'm
actually quite happy to pay taxes back in the UK, less keen on paying taxes in
Australia, as they're rather scummy these days to NZ citizens, so I'm getting
a little screwed over with no path to permanent residency, very little
benefits, yet still have to pay full whack of tax... Lovely. (Fuck Australia)

But, in your situation, moving every 2-3 months can mean you might actually
avoid tax residency in most countries. So it can be complex. Look into the
three or five flags theory for perpetual travellers. Also into tax-residency
rules of the countries you'll be staying in.

Essentially you want to have your citizenship somewhere where your foreign
income is not taxed. Have a legal residence somewhere with low tax/tax haven.
Earn your money/host your business somewhere with low corporate rates, have
your assets somewhere where they aren't taxed massively and spend your money
somewhere with low levels of consumption tax/VAT.

As for visas, it's really just travelling at a slower pace. While working
remotely, it's kind of a blurry situation. Mostly though, as long as you don't
remain longer than six months in one country, you're unlikely to fall foul of
residency laws (for tax purposes).

~~~
tornadoboy55
> Essentially you want to have your citizenship somewhere where your foreign
> income is not taxed. Have a legal residence somewhere with low tax/tax
> haven. Earn your money/host your business somewhere with low corporate
> rates, have your assets somewhere where they aren't taxed massively and
> spend your money somewhere with low levels of consumption tax/VAT.

How to be a societal leech and contribute the absolute least you can 101.
Sickening.

~~~
daflip
Are you saying if you had the opportunity to do this you'd opt not to and
instead pay taxes?

------
dageshi
Pay tax in your home country and travel on Tourist Visa's where visa's are
required or expedient.

Make sure payments are made to your home country bank account and not to any
kind of local account.

Do that and be relatively discrete about what you're doing and you'll have no
problems whatsoever. DO NOT try to explain what you're doing to any
immigration/officials/authorities, simply say you're a tourist which in
practical terms you are.

------
jeddawson
I have a related question, but switched around: I have a US based company that
recently started paying an international contractor (individual) for some
programming work. He’s not a W2 employee and being that he’s not a US citizen
I’ve just been paying him in full and not withholding anything for taxes. This
mirrors how I’ve paid other US based 1099 contractors.

As the project has gained momentum and is looking to be something that will
continue long-term, it has me wondering about the correct process. A couple
weeks ago I spent a few hours researching IRS documents and posts found by
googling, but nothing was conclusive. Some of the information I found
indicated what I’ve been doing is correct, but I need to have the contractor
sign a W-8BEN [1]. Other information indicated that I should be withholding
30% of his earnings even though he meets the standard to be a 1099 contractor
if he was a US citizen.

Do others have experience with this and what can you offer as advice?

[1] [https://www.irs.gov/pub/irs-pdf/fw8ben.pdf](https://www.irs.gov/pub/irs-
pdf/fw8ben.pdf)

~~~
davimack
If they've established a corporation on their end of things (known as a "sole
trader" in the UK), then you can just send them a 10-99 as per usual, because
you're paying a corporation, not a person. I have done this with a contractor
in the UK and my corporation is in the US and had no problems with it.

\--edit: this is my personal experience and may not be used as tax advice in
the legal sense--

------
Havoc
Step 1: Don't be American. They're taxed on global income so you're pretty
screwed there if you are - see point 3 though.

Step 2: Avoid being tax resident in countries. e.g. In the UK you only become
a full tax resident after ~90 days (or something like that - I didn't deal
with it). The more tax residencies you collect the more of a mess it'll be.

Step 3: Stick to countries with double tax agreements in place ("DTAs")

~~~
maxerickson
The US has a big exemption and credit for foreign taxes.

[https://www.irs.gov/individuals/international-
taxpayers/fore...](https://www.irs.gov/individuals/international-
taxpayers/foreign-earned-income-exclusion)

[https://www.irs.gov/individuals/international-
taxpayers/fore...](https://www.irs.gov/individuals/international-
taxpayers/foreign-tax-credit)

The filing requirements for US expats are onerous, they are hardly "pretty
screwed" when it comes to earning income.

~~~
yehi
As an expat let me tell you how screwed I am.

1) Some banks to want to deal with the liabilities of American clients (even
dual citizens). There have been many cases were they simply said that all
Americans must withdraw all of their money in a month and that they are no
longer welcome to open an account [1]

2) I must report ALL of my money located abroad (since I am worth more than
$10,000). That includes; bank account, pension fund, joint bank accounts (even
with a non-American spouse), tax account after working at least once as a
contractor, etc. No free tax software deals with all of that, so I must pay an
American tax accountant located in my country a yearly I-am-an-American fee.
If there is any mistake I could be fined up to half of everything that I own
in America and in my country. [2]

3) Since I am lucky enough to have another citizenship, if I want to get rid
of my American one, I will have to pay several thousand dollars to do that.
[3] And there have been several cases were it has been more difficult for
those people to receive visas to visit America.

[1]
[http://www.forbes.com/sites/deborahljacobs/2012/07/31/most-f...](http://www.forbes.com/sites/deborahljacobs/2012/07/31/most-
foreign-banks-dont-want-u-s-clients-how-to-find-one-that-does/#4f2f0a605a8b)

[2] [http://www.forbes.com/sites/robertwood/2012/06/04/fbar-
penal...](http://www.forbes.com/sites/robertwood/2012/06/04/fbar-penalties-
when-will-irs-let-you-off-with-a-warning/#5538eb2c5dfa)

[3] [http://nomadcapitalist.com/2015/11/16/renounce-fee-
relinquis...](http://nomadcapitalist.com/2015/11/16/renounce-fee-relinquish-
us-citizenship/)

~~~
kingosticks
I assume you mean "Some banks don't want to deal with". I have also have heard
of this problem in some countries. Fortunately I live in the UK and I am
unaware of any bank there that is rejecting US citizens.

Since you are referring to a $10,000 limit I assume you mean FBAR (rather than
FACTA as that has a $200k limit combined across all accounts for non-
residents). If so, have you looked at filing it yourself? It is really quite
easy, just a bit time consuming to fill all the address details in the first
time ( after which you can just copy and update it every year).

And yes, the increased fee is a joke. Do you have a source for people having
visa problems? I've not heard about that but I'm interested to know more.

------
yehi
Every country is different. You will have to specify what country you are a
citizen to, and where you plan on going.

I know that being an American citizen can make it very difficult to live
abroad. I am an accidental American and I have to report all of my money that
I earn and keep abroad. That means if I have a job and earn a salary, keep a
pension fund, have investments, work as a contractor for 1 job and have my
spouse's bank account under both our names, I have to report all of that.
Seeing as no free software offers a way to do all that I have to pay a yearly
I-am-an-American "tax" to an accountant to make sure that everything is filed
properly. If any mistake is made I could be fined up to half of the money that
I own (not the money that I have in America, but all of the money that I own).
If I want to open a bank account, I better hope that my bank in my country
decides to bother with all of the liability involved with having an American
customer. If not, they can (and some have) simply close my account and tell me
to withdraw everything. If I want to start investing through a company such as
Schwab, I must declare exactly how I earned all of the money, be limited in
the funds that I can buy, and receive less perks.

If anyone else is an American living abroad or who wants to live abroad, feel
free to contact me. On the bright side, we still are allowed to vote. That
means that I periodically call my representative and let them know that I
don't care whether they are Democrat / Republican, Pro-Life / Pro-Choice, like
Trump / hate Trump, if they want to repeal these laws preventing Americans
living abroad from living a normal life, I will vote for them.

If you are and American who is interested in leaving America or if you already
have, feel free to read more here: [https://aaro.org/position-
papers-2015/taxation-and-financial...](https://aaro.org/position-
papers-2015/taxation-and-financial-reporting)

~~~
kennon42
American Citizens Abroad
([https://www.americansabroad.org/](https://www.americansabroad.org/)) is
another non-profit organization working on behalf of US persons abroad. They
are doing some great (but probably ultimately quixotic) lobbying work in favor
of changing to Residence Based Taxation, and they have also spearheaded a way
to have a US bank account even when you aren't able to be physically present.

Their newsletters also have general good advice etc. and are generally a great
resource.

------
zhte415
You're asking about tax residency which is a hassle depending on where you are
or where you're from. I am not a lawyer, just personal thoughts :)

A not bad idea however, is to incorporate a small limited company that can
bill your clients around the world. Clients tend to like this as it is simple
to declare expenses. Don't take a $50 Cayman-ish Internet registrar; take a
reputable one that will act as named company secretary, $200-$500 should be
fine depending on where you are. Gives you a registered address and a
professional to call if you freak out.

You need to keep books and file tax reports, but is not a hassle and can save
a lot of hassle.

Pay yourself from that company and when incorporating it (less than 30
minutes), wherever you are, ask your accountant/company secretary how the
company should pay taxes. For your case (wherever you are) they will have
heard the question a thousand times before and give you frank advice; this
non-charged advice saves them time during busy periods in the year. You still
need to do the books and keep necessary paperwork, or send it to them.

Do not do the above and work as a Nomad while receiving income from a client
in the same country (unless you're incorporated in that country, or on a
business visa but we're getting really case-by-case in this, ahem, case).
You'll be treated as an illegal worker, opposed to a cash-injector.

A bit of a ramble. How something in there was useful.

------
tiku
Nobody is mentioning Estonia.. They promote it, but you should be aware of
double taxation rules with your own country, in short it means you can be
double billed but can ask it back.

I've started my own company there and can bill from there, or pay myself a
salary, whatever is most handy.

~~~
devgutt
How is it going by far in Estonia? It is on my radar for a while.

------
contingencies
Taxes: It depends on your citizenship, nominal or achievable tax residency
status and plans for the future whether you benefit from paying taxes in a
given jurisdiction, as well as that jurisdiction's regulations. You can pay in
to multiple jurisdictions if you want, and sometimes this may be smart. You
can pay it as various corporate taxes, or you can pay it as personal income
tax. Sometimes you can avoid tax entirely (eg. structure a company to operate
at a loss, and keep profits outside the country of tax residency in a special
low or no tax jurisdiction - large companies do this all the time, though it
is becoming very much frowned upon it is still pretty damn common). Note that
some countries have low or no personal income tax, but have pretty
low/reasonable corporate profit tax (eg. Hong Kong), and some waive the latter
for a period when starting a new company (eg. Singapore I believe). Moving
arbitrary amounts of capital between countries to avoid profits accruing is
often achieved using "IP licensing agreements" or similar. Personally I have
three citizenships, plus bank accounts in fourth, fifth and sixth countries
(shut down a seventh). Sometimes I get paid in Bitcoin, just to keep things
interesting. A big issue can be the tax implications of share options, in
which case you might conceivably even benefit from changing tax residency
specifically to vest. Basically there's as much complexity as you can possibly
imagine here.

Tourist visa: You're not working, really. It's a continuation of your
established consulting commitments. You are on holiday. There's no law against
that.

------
cygnus
Question to the crowd.

What if you are not staying more than 3 months in a country, per year?

Where are you tax resident?

Are you even legally resident somewhere?

Should you even pay taxes? Who is going to catch you?

Honest question. I'm not American, part time nomad, paying taxes but thinking
about the uselessness of doing so quite often.

~~~
ju-st
I recently read this article [1] from a digital nomad. He founded a LLC in
Hong Kong where offshore profits are not taxed so apparently your LLC in HK
doesn't pay any taxes. And he is not a tax resident anywhere.

[https://wirelesslife.de/unternehmensgruendung-im-ausland-
mei...](https://wirelesslife.de/unternehmensgruendung-im-ausland-meine-
erfahrungen-mit-einer-limited-hong-kong/)

~~~
cygnus
thanks!

------
wslh
In countries like Argentina you can stay as much as you want without any
issue. Just need to travel (and return) to a near country like Uruguay every
some months.

I would love to know in a comment why this suggestion is downvoted.

~~~
PedroSena
This practice is called border run and many countries in Latin America allow
that. Costa Rica and Peru are two of them.

------
charlesdm
Are you an american, or not? If you're not, there are possibilities of paying
(close to) no tax at all if you travel around.

Where are you resident now?

~~~
foobazzy
No. I am not American. And I do not fully understand. I will anyways be
charged in my home country for foreign income, I think.

~~~
masklinn
> No. I am not American. And I do not fully understand.

American citizens are taxed on their worldwide income _by the US_ regardless
of their place of residence. There's a standard taxable income reduction (the
Foreign Earned Income Exclusion) but they still have to file taxes no matter
where they live.

> I will anyways be charged in my home country for foreign income, I think.

Most places work on the residence principle (following OECD/UN model
convention), there's a country of which you are resident (which may be
different from your citizenship one, I'm not sure which you meant by "home
country") and you pay income taxes in that country. You probably want to talk
to the tax authorities and an accountant either way.

~~~
salesguy222
to add additional info, americans are taxed on income above 100k roughly per
year that is earned from abroad. so if you are having above average success
and you are making 200k per year abroad, then you will have a taxable income
of 100k (roughly 19% effective rate)

If you are earning income from a US based source, such as payroll earnings
from a US company, I believe you will be taxed in full, federal, state,
medicare, social security. That's about 30% on 100k income if you are
unmarried

I don't know how it works if you want to try to persuade the IRS that even
though you are working for a US company with a W2 that lists a US address, you
are "not living in the US". Maybe you could get away with it, but technically
your company would have some legal problems for not getting you the right
visas to "work" in a foreign country

As an American, i'd say its easier just to pay us tax and hop around on
tourist visas

~~~
nodamage
For purposes of the FEIE, whether you are being paid by a US company or a
foreign company is irrelevant. As long as you qualify for the FEIE under the
physical presence test (more common) or the bona-fide residence test (less
common), you can claim the FEIE, even if you are working for a US company and
the money is being deposited into your US bank account.

Source: [https://www.irs.gov/individuals/international-
taxpayers/fore...](https://www.irs.gov/individuals/international-
taxpayers/foreign-earned-income-exclusion-what-is-foreign-earned-income)

If you receive a W-2 you'll continue to pay your half of the Medicare and
Social Security taxes. Federal gives you an exclusion of ~$100k, you may or
may not owe state tax depending on the non-residency rules for that state, or
if your state does not have income tax.

~~~
eric-hu
From what I can tell, if you receive a 1099, you also have to pay for FICA
(Medicare & social security) regardless of your FEIE status.

~~~
nodamage
That's correct, FEIE only exempts income tax.

------
twfarland
The world hasn't really caught up with the reality of remote work, but for
now, I just pay taxes where I reside most of the time.

------
bloat
I suggest you ask an accountant or some other kind of tax specialist in the
country which contains the bank where you will receive your salary. Presumably
that's your home country.

As others have said, it's probable that if you are out of this particular
country for long enough you will not have to pay tax there.

------
mcjiggerlog
It depends where you are from, where you are going and how much time you
intend on spending there. Anyone giving you answers without knowing the
answers to those questions should not be listened to. You probably want to
speak to somebody who is actually qualified to give you proper answers.

I'd say generally you are tax resident in your own country until you spend
enough time in another country for THAT country to consider you tax resident.
At that point a double tax agreement kicks in and therefore you only need to
pay tax in your new country of residence. If you move around all the time then
you generally have to pay in your own country. This all assumes you are
working freelance.

I believe a lot digital nomads actually declare no income anywhere and don't
pay any tax. This is obviously risky and illegal and not a great idea.

------
benibela
Another issue is health care insurance.

For example Germany has mandatory insurance. So you cannot cancel your
insurance, and even if you travel in another country they still expect you to
pay the insurance in Germany. Public insurance for freelancers costs around
350€ / month, and as DN without German employer they will classify you as
freelancer.

You probably do not have to pay the full fee while being outside of Germany,
but public insurance has various rules which even the insurance providers do
not know, because they are set by law/regulations not by the providers
themselves and the clerks by the providers rarely deal with DN.

1\. If you have no savings, it only costs a reduced rate of 150€ / month. But
traveling without savings is risky, too.

2\. If they register you as freelancers, you can opt out and get private
insurance, which costs between the reduced and the full public insurance rate,
while you are young. But it is a market-rate and become arbitrary expensive,
if you are old, and you can not switch back to public insurance (except for
marriage or a non-freelancing job with a certain inome).

3\. Thus you must be very carefully when choosing a travel health care
insurance, because they might consider that to be a private insurance, and if
you had private insurance, you cannot go back to the public insurance.

4\. There was an obscure emergency-like plan, where you register as being in
another country and then only pay a minimal fee to be insured, but do not get
anything covered and you must be outside of Germany for several months. Hard
to find any information about that.

5\. The important thing is to do all (un)registrations before leaving. Since
insurance is mandatory, you always have insurance in Germany, even though you
were away. So when you are back there, the new insurance will not begin in
that moment, but begin retroactively when the last insurance had ended. When
you are then still doing freelancer work, they will bill you a lump sum of
350€ for every month you were away.

------
pinoyyid
Re the replies that mention the UK.

Since 2014, tax residency in the UK is now quite a complicated algorithm (see
[https://www.gov.uk/government/publications/rdr3-statutory-
re...](https://www.gov.uk/government/publications/rdr3-statutory-residence-
test-srt)). Provided you keep your work-days in the UK low, and can
demonstrate workdays outside of the UK, it's possible to avoid tax residency.

However, it's worth considering the benefit of being a UK tax resident is that
you accrue National Insurance contributions (even if the amount of those
contributions is zero!), which in turn qualify you for a state pension.

------
WhiteSource1
1\. Speak to an accountant. Each country has their own tax regime, depending
on your residency status.

The bigger issue is making sure you have the legal right to work where you are
going and don't get into double taxation. Everything is country specific. (And
see #2, if you are a US citizen there are tax treaties so you need to see).

2\. You don't state where you are a citizen of and where you are working but
the United States taxes on global worldwide income (only country to do so but
there are tax treaties).

3\. On an offhand way, it's probably easiest for you to incorporate and work
for that corporation but it depends on the nature of your remote work.

------
wprapido
as of taxes, i've incorporated a free zone UAE company and it gave me a 3 year
residence in UAE. it comes much cheaper than paying taxes pretty much anywhere
else. establishing residence in paraguay might be another option

unless you're a US citizen, your country of citizenship doesn't tax you if you
live abroad

------
typetypetype
I do not do this and am not an expert by any means, but I would look into
establishing residency in whichever non income tax state is easiest to do so.
Then you just have to worry about federal taxes.

------
pimterry
> How do taxes work in this case? Am I supposed to be taxed based on my home
> country, the company's home country or the country I am currently residing
> in?

I'm not a tax accountant, but I've spent a reasonable while looking at this
and talking to various people in similar situations.

Step one: work out where you're tax resident. You're typically tax resident in
the place you spend more than 6 months of the year. There are some more
complex per-country rules if that doesn't cover you though, and lots of tie
breakers on things like where your ties are (where your business/family are
located) and how many days you spent _working_ in the countries involved. This
can be complicated and gets relatively subjective in the tricky cases. If it's
truly ambiguous and you're not a super high earner, you can probably pick any
plausible option without much risk.

Step two: pay taxes on income earned in the country(ies) when you earned it
(i.e. where you currently are working, if you're working remotely), plus taxes
on your whole annual income wherever you're tax resident. There are double-
taxation treaties between most nations that allow you to claim it back. If
you're American, I think you _also_ have to pay taxes in America, on top of
the above (but I'm not American, so I'm not sure on that). An example:

\- You live in the UK for 9 months this year, so you're a UK tax resident

\- You work from Spain for 3 months (remotely or locally)

\- You should pay tax in Spain for the earnings of those three months

\- You should pay tax in the UK for the full year, but claim payments in Spain
back against that (there's a field for this on UK tax returns).

\- That means your total tax bill is the same as if you were just in the UK
(this isn't necessarily always true, if you have wildly different tax rates),
but there's just more paperwork.

In practice, my impression is loads of people ignore these rules (I personally
know large numbers of people doing so), and just pay tax where they're tax
resident (or even just where they were last tax resident), and skip the extra
paperwork.

Whether you can get away with that depends on your situation, but if you're
asking for tax advice on HN you're probably not an individual where it's going
to bite you, as long as you pay tax correctly for the majority (i.e. if you
just pay normal full tax to the UK, in this example).

This is 'what happens in practice' advice though - it's a good idea to
actually talk to an accountant, and take the risks of shortcuts here
seriously, especially if your situation is interesting or complicated or
you're earning a lot of money. These rules can also vary significantly in
other nations, so you'll need to double check them for each of the countries
you're planning to visit.

------
oDot
Kind of related:

Is there an easy way to ask the VAT back from each country?

~~~
wprapido
getting VAT back on some purchases is fairly easy. ask them in any store with
''tax free'' tag

------
thro230909
I am self employed. My country allows me to declare flat expenses on up to 60%
of my income. No accounting or proof needed. Real taxation is around 20% on
$100K income (including social and health insurance).

So every year I spend about 2 hours with:

\- sum all money that arrived to my account in last year

\- fill form on IRS website

\- update standing orders for health/social contributions for the next year

\- one month latter, ring IRS and other offices, just to check all went
through

If you move every two months, I would not worry about it too much. Important
is:

\- you pay taxes somewhere (preferably in your home country)

\- you do not work for locals

~~~
blurrywh
Which country is this?

~~~
netmare
Probably a Scandinavian one. I've heard that forming an LLC there requires
filling a single form. Maybe their taxation & insurance is that simple as
well.

After researching similar matters in my own country (Greece), where you have
to juggle dozens of forms in as many offices and constantly file taxes every
month (or 3), I've given up on ever being self-employed.

