What to know before you go
Forget the old expression of the two certainties in life—death and taxes. Life crossing borders and taxes are synonymous and certain, and the longer you travel the greater the tax implications. So, whether you’re a digital nomad or an expat, a vacationer or a remote worker, no matter where you go in the world, you will pay taxes.
Maybe you have a head for numbers. Maybe you don’t. Maybe you’ve got an eye for detail. Maybe you’re more of a big picture thinker. Well, taxes and the countries in which you pay them don’t care about that. You’ve got to be aware of what they are in every country in which you travel, and how or if your travel affects the taxes you pay in your home country.
Fortunately, there are people in the world, travelers like you, experts in their fields, who are here to help.
Andrew Jernigan, CEO of Insured Nomads, an insurtech specializing in tech-enabled travel insurance solution, advises:
Tax liabilities are incurred when you spend specific amounts of time in certain countries. Working with a knowledgeable tax professional provides you with an advantage of having a pro on your side as you wade through these waters.
What the IRS Has to Say
According to IRS.gov, “If you are a U.S. citizen or resident alien living or traveling outside the United States, you generally are required to file income tax returns, estate tax returns, and gift tax returns and pay estimated tax in the same way as those residing in the United States.”
These are different depending on whether you are defined as a U.S. citizen, alien resident abroad, foreign person, U.S. territory taxpayer or other. Digital Nomads, specifically, can find information in the Self-Employed Tax Center.
Also, according to IRS.gov, “Many Americans living abroad qualify for special tax benefits, such as the foreign earned income exclusion and foreign tax credit, but they can only get them by filing a U.S. return.”
Remote Work Visas
Countries are also now issuing special remote work visas, like the Remote Working Program at Cabo Verde, which may come with their own set of special tax exemptions or perks. Aruba, for example, issues remote work visas and has no income taxes. The lush, unspoiled island of Mauritius doesn’t even charge for a remote work visa, nor does the island of Svalbard, Norway.
What about Cryptocurrency?
Using Cryptocurrency abroad could make life a bit easier. The Pros of using crypto include the following:
- It’s versatile. Stored in the block chain, it is easy to access and to use to make both payments and investments.
- It can be used for essential items. Whereas in its infancy, crypto was accepted only in niche markets, it can now be used for a variety of products and services. It can even be used to buy travel insurance with Insured Nomads, the first of its kind to offer this service.
- It cuts out the middleman. Cryptocurrency is decentralized, so no third parties, like banks, are involved. You have immediate, real-time access to your currency while you travel.
However, it’s important to note that cryptocurrency can make tax tricky, considering that different laws apply in different countries. Be mindful, do your due diligence, and rely on your tax pro for advice navigating these areas.
Travel Insurance & Tax Benefits
Buying Travel insurance doesn’t come with any tax benefits. However, just as working with a tax pro protects you financially, so does travel insurance. Plus, over 50 countries require travel insurance to enter.
Travel insurance can cover your health, safety, property, and certainly your peace of mind. You can read more about your travel insurance options and the benefits below.
When you purchase travel or global health insurance through Insured Nomads, you get exclusive access to the INC Membership app. Among several value-added benefits this app provides, it also has quick access to tax information, including a resident tax risk assessment, and tipping courtesies in the country to which you’re traveling so you can be respectful of its citizens and prepared.
So, the moral of this story is Insurance + Tax Knowledge = One Prepared & Protected Nomad. Follow NomadTax to help you navigate the world of taxes while you travel and Insured Nomads to keep you protected within it.
About Insured Nomads
Insured Nomads is the first to take an integrated traveltech, fintech and insurtech solution to the world for remote workers, globally distributed teams, expats, and travelers. Their purpose is to make travel as safe and smart as staying at home. They do this by providing health insurance with exceptional medical benefits in tandem with wellbeing, safety, security, and advanced tech-enabled solutions for ease of payment for healthcare, emergency response and evacuation. Insured Nomads is available through affinity relationships, direct, embedded and through select brokers and partners for groups and individuals.
Information on integration, collaboration and partnership contact Brett Estep: email@example.com