What Is A Digital Nomad?

Once upon a time, there was a traditional way of working which consisted of going into the office 9 to 5, five days a week. The opportunity to work abroad wasn’t something you could simply decide to do, it was typically only made possible through corporate relocations.

Today, the conventional work landscape has undergone a radical transformation and the conventional 9 to 5 routine and daily commutes no longer define how people work. Instead, people feel encouraged to discover methods of working that suit them.

Enter the digital nomad. As the name implies, these individuals embrace a nomadic approach to work. They leverage telecommunications technology to work remotely from any corner of the globe, breaking free from the confines of traditional office spaces.

Understanding The World of The Digital Nomad

Fundamentally, digital nomads are not tied to a specific location. As long as they have a device that gives them access to a robust internet connection, these individuals can relocate their place of residence while maintaining their work responsibilities.

The benefits of this are relatively obvious. Digital nomads can sustain their livelihoods while embarking on global adventures. Immersing themselves in diverse cultures, cuisines, communities, and landscapes becomes not just a perk, but an integral part of this lifestyle.

How Do Digital Nomads Make Money?

You might be wondering: How exactly do digital nomads sustain themselves without adhering to traditional employment norms?

All digital nomads will need to maintain a living remotely, so their job choices are somewhat limited. Typically, digital nomads gravitate towards fields like freelance writing, web development, graphic design, digital marketing, consulting, and other roles compatible with remote work.

Digital nomads may operate as self-employed or freelance professionals, though they typically need to remain formally employed by companies or clients in their home countries while executing their tasks from abroad. Digital nomads may also be full-time employees or business and startup owners.

This is because many countries require all digital nomads residing within their borders to maintain employment ties to their home countries, and they will need to provide proof of ongoing employment upon entry. This serves to demonstrate their financial stability and ability to sustain themselves during their stay.

Do Digital Nomads Pay Tax?

As digital nomads often work abroad while maintaining professional employment or clients at home, the question arises: How exactly do they navigate tax obligations?

The answer to this may be the greatest price to pay as a digital nomad, literally. Unfortunately, in most cases, countries require digital nomads to pay taxes on their earnings while residing within their borders, alongside continuing tax obligations in their home countries.

According to Euro News, a considerable majority of digital nomads surveyed find themselves subject to taxation by their home countries despite living abroad. Most countries require digital nomads to start paying double tax after a specific duration of residency, typically around 183 days. This is the case in countries including Georgia, Norway, Cyprus, Estonia, Spain and Hungary, among others.

Consequently, digital nomads must carefully assess the tax regulations of any prospective destination before relocating. In fact, Euro News also highlights that the cost of being a digital nomad ranks as the foremost consideration when selecting a location.

This leads us to explore the additional factors necessary to embark on the digital nomad lifestyle. Let’s delve deeper into these requirements.

How To Become A Digital Nomad

Becoming a digital nomad might initially conjure visions of effortlessly packing a bag, catching a flight, and waking up the next day amidst palm trees, leisurely sipping coconut water while working on your laptop.

Unfortunately, things are a little more complicated than this.

Firstly, not all countries readily permit digital nomads to legally work and reside within their borders. Therefore, researching countries that accommodate digital nomads is the first essential step.

Countries that do permit digital nomads can facilitate their stay by offering specialised visas or programmes, extending legal stay permissions. Typically, these visas can be applied for online and are granted upon meeting specific criteria, which vary from one visa to another.

Requirements often include demonstrating a minimum income, possessing a valid passport and health insurance, having a clean criminal record, providing proof of remote employment, securing accommodation, and showing evidence of planned travel in and out of the country.

Additionally, visa applications may necessitate letters of intent explaining the move, detailing one’s business activities, showcasing skills beneficial to the country’s economy, and sometimes even passing cultural knowledge tests.

Moreover, visa applicants are generally required to pay application fees, which vary in affordability depending on the country.

Once all requirements are met, applicants may need to schedule appointments online or at local embassies to submit necessary documents for approval by the country’s visa authorities. Following submission, all that’s needed is to wait. This could be for days up to a period of months your visa to be accepted and processed.

Upon receiving the green light, the journey to becoming a digital nomad officially commences. This will be an exciting venture, albeit not without its challenges.

Digital nomads must devise work strategies that suit their lifestyle, potentially utilising co-working spaces to replicate an office structure, navigating different time zones for client interactions, learning new languages, and arranging accommodations, which might include hotels, hostels, rented spaces, or co-living options.

All-in-all, staying organised is paramount, but the rewards can be immeasurable. If executed smoothly, embarking on this adventure opens doors to a new chapter in one’s professional journey which can be enriched by the diverse experiences the world has to offer.

To explore ways of ensuring you have a smooth ride as a digital nomad, find out more here.