WFH - From Abroad - Why not?

[Richard - London]

The bank I used to work at had this problem after Covid, one of the it developers moved himself and his family back to India thinking WFH would be allowed and did not say a thing for just short of 2 years. The company found out when they needed him to come in the next morning for an emergency meeting and he had to explain where he was.

 

[Lopéz]

With the technological capability its clear that we could Work from home - WFH and not be in the UK with no detriment to the employer.

A few years ago a college of mine was actually working from home, or rather, from Lisbon, and everyone was non the wiser, they knew they'd need to be back in the office at some point so took that into account.

However, going forward, why can employers not take employees work-life into account and accept that working from abroad with a UK salary would greatly improve employee's mental health and wellbeing.

Is it the tax implications? Maybe in the future we'll progress towards it?

I think the flight costs would be cheaper than a weekly train 112 miles from the North East of the UK to Manchester for me if I were the re-locate from the north west.

It's not as straightforward as people like to think.

If the country offers a Digital Nomad visa then it is simplified somewhat.

Some implications/complications:

Contract & Employment law - under which set of rules are you bound

Corporate Tax - in many countries, your employer also has a contribution obligation in the country in which it is operating, and you working there remotely will count in a great number of those cases.

Income tax - If you are living in another country, in the majority of cases you will be deemed tax resident there. Some countries take a stricter view on this, some use a 183 days roller, etc etc - it isn't standard and you cannot assume

Workplace insurance - You are not working in the UK, how will this work?

Health insurance - Which pot are you paying into and how?

Nationality - If you are British then you cannot simply move to another country without a Visa and/or residency permit of some description. You can only stay in the country for 90 days, in most cases you cannot work there, and you cannot just hop back over a border to reset your 90 days either.

I'm not trying to put you off, but having been there done that it's a minefield in all honesty.

 

[rypt]

I work for a high street bank and it makes me wonder as I'm sure we have offices abroad.

In the Banking sector it's two things that stop remote work in other countries:

1) financial regulations/ licensing - this is the reason that I can only work in a country where my company (bank) has an office

2) tax

 

[Lopéz]

With the technological capability its clear that we could Work from home - WFH and not be in the UK with no detriment to the employer.

A few years ago a college of mine was actually working from home, or rather, from Lisbon, and everyone was non the wiser, they knew they'd need to be back in the office at some point so took that into account.

However, going forward, why can employers not take employees work-life into account and accept that working from abroad with a UK salary would greatly improve employee's mental health and wellbeing.

Is it the tax implications? Maybe in the future we'll progress towards it?

I think the flight costs would be cheaper than a weekly train 112 miles from the North East of the UK to Manchester for me if I were the re-locate from the north west.

ps what your colleague was doing was almost certainly tax fraud, by the way.

If you spend over 183 days in any 12 month period in Portugal, or if you maintain a "habitual residence" in Portugal then you are a tax resident as of your first day there, and that means Portugal has a claim to tax your worldwide income. Since Portugal and the UK have a dual taxation treaty, you would probably need to employ a tax consultant to help sort this out for you. Not impossible but potentially costly and complex for both you and your employer.

Since Brexit, obviously it's worse , because now your colleague would have no right to work or live in the Portugal anyway, he would be considered a 3rd country national - and would therefore need to have official Portuguese residency or a visa to perform work there.

 

[Lopéz]

I wouldn't want to do it without telling my employer though. Essentially you'd be trying to work on a tourist visa which would be illegal if caught.

This is probably the most serious part - since Brexit you can't just go and live and work where you like under the radar. If you are caught, as Martyn says this is not only illegal but you will (with almost absolute certainty) be deported and having a deportation marker on your record is not_a_good_thing

 

[delta0]

This is probably the most serious part - since Brexit you can't just go and live and work where you like under the radar. If you are caught, as Martyn says this is not only illegal but you will (with almost absolute certainty) be deported and having a deportation marker on your record is not_a_good_thing

Even in the EU it’s not really that straight forward. You can’t just work for a German company and live in France unless the job has been setup that way from the start.

 

[mid_gen]

I saw something like this on social media where some dude was working abroad in a 5 star hotel all inclusive for months and it was cheaper than living in the UK!

Be careful what you wish for though because if legislation becomes active that would allow it then goodbye decent wages as masses of Indians will do your job for a quarter of the wage.

The last thing I would want going forward is a WFH job because you are the easiest thing to replace by cheaper labour.

Everything that can be economically outsourced already has been. Indian wages have increased massively over the last decade or so and aren't cheap enough to make the outsourcing worthwhile for most businesses now.

The smart businesses, the ones making the big money, recognise that getting the best staff is more important than getting the cheapest. So these flexible working arrangements, hybrid, remote etc give them access to the best talent pool and acquire the best hires.

 

[McGray]

I worked remotely abroad for my current (UK) company whilst on a student visa. Went to college in the morning and worked in the afternoon.

No idea on the legality of it but it was grand.

 

[jaybee]

My employer allows us to work from abroad for up to four weeks a year (for a maximum of two weeks at a time). I assume the limit is for tax reasons.

However, there’s an approved list of countries we can work from. The banned list includes countries you’d expect but also some you wouldn’t (e.g. Republic of Korea). I assume it’s to do with local data laws that could put our intellectual property at risk.

Mine is similar. 4 weeks as well I think.

 

[Raymond Lin]

In theory, I can WFH now and again, as I did WFH for 4 months during a period in the Pandemic. But in practice, I seldom do because I don't have the correct set up at home to do it comfortably beside the kitchen table. Only really do it when I have to be at home for the day, like if a tradesman comes to fix something like the boiler or garden fence so I work from home that day.

I guess it does mean I could "escape" and go for a long weekend a day early on a Friday, like get to the airport Thursday night and on Friday log online somewhere else in a hotel, then start my holiday soon as I log off on Friday night.

 

[McGray]

I guess it does mean I could "escape" and go for a long weekend a day early on a Friday, like get to the airport Thursday night and on Friday log online somewhere else in a hotel, then start my holiday soon as I log off on Friday night.

I have never done this (hi boss).

 

[Lopéz]

Even in the EU it’s not really that straight forward. You can’t just work for a German company and live in France unless the job has been setup that way from the start.

Yeah you're absolutely right. The main difference intra-EU is you don't usually have the added right to work/live complication that British people have.

 

[Hades]

In theory, I can WFH now and again, as I did WFH for 4 months during a period in the Pandemic. But in practice, I seldom do because I don't have the correct set up at home to do it comfortably beside the kitchen table. Only really do it when I have to be at home for the day, like if a tradesman comes to fix something like the boiler or garden fence so I work from home that day.

I guess it does mean I could "escape" and go for a long weekend a day early on a Friday, like get to the airport Thursday night and on Friday log online somewhere else in a hotel, then start my holiday soon as I log off on Friday night.

Just be mindful of your company having some kind of "impossible travel" alert which could prevent you accessing their systems. There are obviously ways around this though.

 

[neocon]

Where you pay tax seems a tricky point. If you were paid PAYE here but were living in Lisbon, won't you have to buy private medical insurance and pay taxes in Lisbon?

 

[neocon]

In theory, I can WFH now and again, as I did WFH for 4 months during a period in the Pandemic. But in practice, I seldom do because I don't have the correct set up at home to do it comfortably beside the kitchen table. Only really do it when I have to be at home for the day, like if a tradesman comes to fix something like the boiler or garden fence so I work from home that day.

I guess it does mean I could "escape" and go for a long weekend a day early on a Friday, like get to the airport Thursday night and on Friday log online somewhere else in a hotel, then start my holiday soon as I log off on Friday night.

Don't you want to go for the digital nomad visa in Japan?

 

[Raymond Lin]

Don't you want to go for the digital nomad visa in Japan?

The minimum salary for that is 10 million yen, which in today's almost record high exchange rate, is £52k. If it is the exchange rate from 18 months ago, I would need to be on like £80k. I don't qualify.

 

[neocon]

The minimum salary for that is 10 million yen, which in today's almost record high exchange rate, is £52k. If it is the exchange rate from 18 months ago, I would need to be on like £80k. I don't qualify.

The rate might move further in our favour, we can only hope

 

[dowie]

With the technological capability its clear that we could Work from home - WFH and not be in the UK with no detriment to the employer.
[...]
Is it the tax implications? Maybe in the future we'll progress towards it?

Tax and legal; imagine you moved to some random EU country, get classed as an employee in that jurisdiction and then later your employer makes your role redundant or tries to fire you and suddenly finds out they were supposed to have given 6 months' notice and negotiated with some union they didn't know existed. Typically if you want to move to another country then it's far easier if your employer already has a presence there and you can be moved over to the headcount of that subsidiary. Otherwise as an individual, if you're the only employee in that country then they'd perhaps have to pay a third party specialising in remote workers to manage payroll, HR/legal stuff and that's an extra cost - unless you're really available to them then you're not necessarily going to be able to convince them to do that on a whim, perhaps if you're marrying someone from that country or partner is moving for work and you'd like to keep your current role then you'll have good reason for them to sort it for you.

Generally, you're able to say take a working holiday with your laptop without impacting that sort of thing (various employment contracts will have T&Cs allowing that) but you can't fully relocate on a whim without your employer approving it. There are tax implications too, different governments to pay tax to for a start!

It's certainly easier for freelancers or contractors though, indeed it could be a simple way to stay outside of IR35; you could set up a ltd company in the Isle of Man for example, work there for some of the year and travel a bit and bill from that; same currency and VAT rate etc.. just favourable tax treatment for yourself.

 

[Lopéz]

Where you pay tax seems a tricky point. If you were paid PAYE here but were living in Lisbon, won't you have to buy private medical insurance and pay taxes in Lisbon?

Yes, you'd need a tax advisor to sort out the dual tax setup between PT and GB, it doesn't happen automatically.

A further complication is that our social security contributions are no longer considered reciprocal between the UK and the EU post Brexit. This can get expensive fast.

 

[bayo000]

I imagine for most companies it comes down to tax/ extra paperwork and managing working hours especially if there's bigger time difference.

I'm quite lucky and we are allowed to do short stints. For example I spent 2 weeks working abroad in the summer while my dad was recovering from a surgery so I could help out as both my parents are in their 80s. But there were a few things to sort out like insurance and making sure all software licensing will work. We have a guy from Caribbean and for some software we had to set up a desktop in the office for him to remote desktop to. Also some of our clients prefer that all the data stays stored in the UK so that's another thing to manage.