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In our current practice, we deal with this topic on a daily basis, which has prompted us to provide a brief overview.
What Do We Mean by a Digital Nomad Visa?
A Digital Nomad Visa is a specific type of residence permit that allows individuals who work remotely (e.g. freelancers, remote employees or entrepreneurs) to legally reside in another country for a set period, while continuing to work for their company abroad.
More and more countries are introducing Digital Nomad Visas to promote tourism-related income (e.g. through longer stays, higher spending) and to attract economically qualified visitors without burdening the local labour market. In addition, innovation and cultural exchange are to be fostered.
Demand has also increased, as many people are looking for a temporary change of work environment – ideally one that combines lower living costs with a high quality of life (e.g. seaside, sunshine, culture) in a legally secure framework.
There are several – not only legal – aspects to consider in this context:
1. Immigration Law
The Digital Nomad Visa generally permits legal residence and living in the host country. In most countries, the visa is temporary, though extensions may be possible. Each country issuing such a visa has its own specific eligibility criteria.
In Switzerland, no such visa currently exists, nor is it expected to be introduced in the foreseeable future.
2. Work Authorisation & Activity
In principle, Digital Nomad Visas only allow for remote work. Typically, gainful employment with local companies or clients is prohibited.
Applicants must prove that they are employed by a foreign company or are self-employed. Countries issuing these visas aim to attract skilled professionals while protecting the local job market from foreign competition.
3. Taxation
Generally, there is no tax liability in the host country as long as the visa holder stays for less than 183 days. However, some countries impose tax liability from day one. It is essential to clarify this in advance based on the individual case.
To be exempt from local taxation, countries often require proof that taxes are being paid in the country of origin or home country. If a double taxation agreement (DTA) exists between the countries, double taxation should not occur. In the absence of such an agreement, it may still arise. To avoid unpleasant surprises, it is advisable to seek tax advice in both countries beforehand.
4. Social Security
Holders of a Digital Nomad Visa are typically not integrated into the local social security system. An international health and accident insurance policy is usually required. Regarding health insurance obligations, almost all countries demand international cover, including repatriation.
Pension or unemployment insurance is usually not required for visa issuance. However, due to the lack of local integration, visa holders must ensure they are adequately insured. If the person is employed, the employer is also responsible for ensuring appropriate insurance cover.
5. Registration & Residence
Many countries require registration with the local authorities (similar to registering a residence). An address in the host country must often be provided, even if staying in a hotel or Airbnb.
6. Data Protection & Reporting Obligations
The visa holder's data is stored in national databases, primarily for visa monitoring. Accordingly, data exchange with other countries (e.g. for tax purposes) is generally possible.
7. Visa Extension or Conversion
Extension of the visa is usually possible, although it often requires renewed proof of income, insurance and residence. Only a few countries allow the conversion of a Digital Nomad Visa into permanent residence status. The applicant's nationality can also play a role in this.
8. Penalties & Consequences for Violations
In most countries, the following may apply in cases of illegal employment or misrepresentation:
- Revocation of the visa
- Fines
- Expulsion and re-entry bans
- Tax evasion may lead to criminal prosecution – including in the home country
9. Requirements & Criteria
Typical requirements include:
- Proof of remote work (e.g. employment contract with a foreign company)
- Minimum annual income (usually between CHF 20,000 – CHF 60,000)
- International health insurance cover
- Clean criminal record
- Valid passport
10. Challenges & Criticism
The following issues are commonly raised:
- Tax grey areas: lack of clarity regarding double taxation
- Bureaucracy: application is generally straightforward, but foreign employers may face consider-able compliance tasks
- Social isolation due to frequent relocation
- Impact on local markets: price increases due to wealthy nomads (e.g. rent)
- Lack of clear distinction from remote work visas
11. Outlook
An increasing number of countries plan to introduce Digital Nomad Visas. As more programmes are launched, it is likely that requirements will become more standardised. Countries with low living costs and good infrastructure will likely remain the most attractive. There should also be a growing focus on sustainability and integration into the local community.
12. Countries
The following is a non-exhaustive list of countries offering a Digital Nomad Visa or similar schemes:
Europe
Albania, Armenia, Croatia, Cyprus, Czech Republic, Estonia, Finland, Georgia, Germany, Greece, Hungary, Ireland, Italy, Latvia, Malta, Montenegro, Netherlands, North Macedonia, Norway, Portugal, Romania, Serbia, Spain
Caribbean & Central America
Anguilla, Antigua and Barbuda, Bahamas, Barbados, Bermuda, Colombia, Costa Rica, Cuba (planned), Dominica, Ecuador, El Salvador, Montserrat, Panama, Uruguay
Asia & Pacific
Australia, Dubai (UAE), India (Goa), Indonesia (planned), Japan, Malaysia, New Zealand (planned), South Korea (planned), Taiwan, Thailand, Vietnam (planned)
Africa
Cape Verde, Mauritius, Namibia, Seychelles
Conclusion
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
