How to Work Remote From Another Country

November 25, 2023

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More people than ever have remote work flexibility. At the same time, more and more countries – think Costa Rica, Indonesia, and the Bahamas – are implementing affordable Digital Nomad Visas that make the dream of working from a beautiful, exotic locale attainable.

But, convincing your boss to let you work from abroad is not as simple as it may seem. As an HR expert who has been responsible for relocating hundreds of people internationally in my career, I know that there are very real practical concerns and challenges that companies will have when you put in your international work request.

You are more likely to be successful with your request to work from that beautiful beach if you understand what their concerns likely will be, then present them viable solutions.

Here is everything you need to know in order to convince your company to let you work from abroad.

The Truth About “Work from Anywhere” Policies

The truth is, if your employer is a U.S. company, they are probably NOT going to want to let you work abroad, or at least they’re going to be pretty hesitant. Most companies in the U.S. with “fully remote” policies really mean “work from anywhere in the United States” not “work from anywhere in the world.” There are some good reasons for that.

However, know that there are things you can do to negotiate with your employer and make it as easy as possible for them to let you work remotely. So let’s talk about it!

Why Are Companies Reluctant to Let Employees Work Overseas?

You need to understand why employers are reluctant to let their employees work from other countries. It’s not just that they think you’ll be having too much fun on the beach to focus. There are good reasons your employer might be concerned:

#1. Permanent Establishment – The most important factor by far! When you become a resident of another country, there is a risk that your company will have to formally register to do business in that country – setting up a company or a branch. Why does this matter? First, it’s a hassle – there is a great deal of paperwork, bureaucracy, and often long wait times. But more importantly, establishing a company in another country usually comes along with having to pay corporate taxes. This could be very expensive for your employer.

#2. Employment law – Laws and regulations that govern your work are generally based on where you the employee are living, even if your company is located in another country. Your employer is responsible for complying with the local employment laws wherever its employees are working. These are laws around things like holidays, overtime pay, maximum working hours, workplace safety, discrimination laws, etc. They will be different from your home country and complicated to manage.

#3. Payroll Mandates – This is actually another part of employment law, but it’s important enough to discuss separately. If you’re living in another country, your employer has to comply with that country’s payroll laws. This means they have to obey another country’s payroll withholdings and payroll taxes, similar to Social Security and Medicare withholdings in the U.S.

There are some exceptions! In particular, if your new country has a Social Security Totalization Agreement with the U.S., you can get out of paying social security to another country as an employer.
But generally, even with a totalization agreement, this is complicated and a big pain for your company.

#4. Time Zones – If you want to take advantage of Thailand’s new digital nomad visa, you’re going to be 10 or 11 hours ahead of East Coast time and 13 or 14 hours ahead of Pacific time. That makes it pretty tough to collaborate.

#5. Safety and Security – Your company might also be concerned about duty of care, or their responsibility for your safety. There may also be cybersecurity concerns – some countries have higher risks in this area, which might matter to your company.

How to Convince Your Employer to Let you Live Internationally

There are a number of good reasons your employer might not want you to work from another country, so how do you get them to agree to let you move internationally?

Let’s go through all of your options. You could choose to pitch one or several of these solutions to your employer or your HR department.

1. Become a True Digital Nomad

Move locations every few months, and your employer can treat it as an extended overseas work trip.

If you want to become a true digital nomad, traveling from country to country to country, it is easier to work abroad. Specifically, if you never spend more than 6 months in a country, you will likely not technically become a resident of that country, and therefore your company will not need to worry about the legal compliance issues mentioned above. Note that most countries do not classify you as a resident until you have spent approximately 6 months physically located there, but this is not true of all countries. Do your research on the countries you want to visit.

2. Register a New Corporate Entity in the Country

This could be a branch or subsidiary that employs you. Alternatively, your company could get a friendly partner/business to employ you abroad – e.g. a supplier or a customer business that can employ and “second” or “shadow payroll” the employee.

This is technically an option, but it could be a stretch. If your company is already starting to expand into the new country where you want to live it is more likely to be of interest. It may work if they have a partner company that’s highly trusted in your new country. But most companies will not want to do this.

3. Use an Employer of Record (EOR) or Professional Employer Organization (PEO)

This is my #1 recommended option. Employers of Record are companies specifically designed to employ YOU in another country, on behalf of your employer.

They take care of all the employment law concerns we talked about earlier, they pay you on behalf of your employer, and you and your company are fully legal. Easy!

The catch is that these companies can be expensive. There are a lot of options out there, but if your company just needs to legally employ you in another country, I’d recommend checking out some of the simpler options – specifically Remote, Deel, and Globalization Partners. Depending on the country, your company will owe maybe $299, more likely $599, or perhaps a little more per month for this service. They’ll also need to consider the different national taxes and withholdings – some countries have mandatory health insurance or other mandatory benefits they’ll need to pay for.

The great news about this service though, is that you can probably negotiate with your employer to hire one of these companies. Likely the easiest way to do this would be to take a monthly pay cut that makes up for the additional monthly cost.

4. Become a Legitimate Contractor

This is another way to work legally from another country, at least for a year or two.

This may seem like the simpler and better answer at first glance, but I want to caution you – if you HAVE been a full-time employee and you want to keep the exact same job and same responsibilities, you could run into trouble here. Your employer could be accused of misclassifying you as a contractor. Sometimes employers do this to avoid paying the withholdings and benefits that come along with hiring employees, and it’s a serious accusation.

Ideally if you become a contractor, it comes along with a change in your work – it could be more project-based for example, or perhaps less central to the core business of your company. For example, I’m currently a recruiting contractor helping a company hire new talent. This is not central to their business model (although that’s not to say it’s not important). Remember that most contractors do not get benefits like health insurance or 401k contributions.

If you want to work as a contractor, it might be easier to start off as a contractor for a new company while working abroad.

5. Just Do It

I do not recommend this option because it is technically not compliant with labor laws in most countries.

However, in many countries, if you are working for a company remotely that does no business in that country OR if your job in particular involves no business done in that country, then it’s pretty unlikely you or your company will get into trouble. This is about enforcement of labor laws. You might be moving to a country that really doesn’t have any interest in enforcing these labor laws – if that’s the case, you and your employer can be fairly confident about your remote work situation, at least for a couple of years. But it’s also possible you move to a country that does care, and that does want to enforce these labor laws. This will be important to research.

Is There Someone I Can Talk To?

Yes! I would be happy to connect to talk through your situation and strategize on how you can approach your company about working from abroad. You can reach me at [email protected]. I’m currently living the dream of working from Costa Rica. I hope to see you here soon!

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