Is it possible to work abroad as a freelancer? What should you take into account so that you avoid legal and tax risks and the negative consequences that go with that?
Freelancing enables you to work when you want, but above all, where you want. For many people, this kind of flexibility motivates them to become a freelancer, with some even going a step further by working completely remotely from abroad.
Lotte Vanhalst, a Belgium freelancer for Beelance has been working from Indonesia since the end of 2020.
“I’ve always travelled a lot, so adventure runs through my veins,” says Lotte. “That’s why I found it difficult to find my way around the four classic office walls. I got a feeling of being locked up and that had a detrimental effect on my mood. After swimming through several waters, I ended up at Beelance at the end of 2020. On a freelance basis I help clients who are looking for the right freelancer to increase the chance of the right match via the Beelance platform.”
Advantages of working remotely
“When I started at Beelance, one of the most important conditions was that I could work completely remotely,” Lotte continues. “And I am glad that was not a problem at all for them, because it offers me a lot of advantages: I work where I am most productive, I have a lot of freedom and variety. At the moment that is in Indonesia, because my friend is also from there, but I could just as well be in another country within a few months. We’ll see what it brings. ”
“It is best to take a number of things into account before you start working abroad professionally. It’s a matter of avoiding trouble in paradise.”
What about legislation?
Remote working sounds like music to your ears, however it is best to take a number of things into account before you start working abroad professionally. Lotte confirms this: “You do indeed have to arrange a number of things in advance. I consciously opted for Belgian legislation, and therefore discussed my situation with the tax authorities. It was important to keep my domicile in Belgium. In this way I can declare my income in Belgium. In addition, I also arranged my social insurance fund, my insurance policies and VAPZ in Belgium. The handy thing is that these services now all work remotely, including my accountant. ”
“Today, there is such a thing as the digital nomad visa in many countries. That gives more possibilities.”
Maximum 6 months per year in the same country
Remote working abroad is not without time limits. “In most countries you can stay there for a maximum of six months a year without having to declare your income. Are you staying longer? Then of course you also have to pay taxes there ”, Lotte explains. “Nowadays there is such a thing as the digital nomad visa in more and more countries. That gives more possibilities. “
“In principle, you are not allowed to work in the country where you are staying with only a tourist visa, but because I work for Belgian and European clients, that is a bit of a gray zone. That you do not steal the work of the local population is an important criterion in this. ”
Working abroad: tips from TCP (People 2.0 Group)
If you really establish yourself abroad as a freelancer and work for local clients, you have to take extra things into account. NextConomy partner TCP, part of People 2.0 Group, is a global provider of payroll expertise for employers, agencies and freelancers. As a compliance specialist, they help clients to deploy employees and freelancers easily and without risk anywhere in the world.
Their tips at a glance:
- Are you allowed to travel to the country of your choice, i.e. are you in possession of the correct travel documents, and do you have a work visa for the country of destination?
- Which business form (NV, BV, sole proprietorship…) do you have as a freelancer now and does it match the country of destination? For example, in Belgium you have a BV, but in Germany it becomes a GmbH.
- What are the local laws in the host country where the work is performed?
- Are there specific local tax laws designed to combat tax evasion by freelancers?
- Are there special regulations for companies that hire freelancers, e.g. freelancers who provide their services to clients through an intermediary, such as a limited liability company, but who would then be classified as a permanent employee if the intermediary function is not used? Consider the recent introduction of IR35 in the UK and the DBA Act in the Netherlands.
- Do you comply with all local rules?
- What are the costs to comply with all local regulations? Think of local insurance, local registrations, local accountants …
- In some countries, such as Finland, you must be registered for tax purposes. You may then need local specific professional insurance in the host country that may not apply in your home country. Examples include civil liability insurance, pension insurance and accident insurance.
- Also keep in mind that in Great Britain, since Brexit, you need a self-employed visa as a self-employed person.
Source: TCP Belgium / People 2.0
More information can be found on the TCP Solutions / People 2.0 website.
Would you like to know more as a client or as a freelancer about international recruitment and cooperation?
Sign up for the free webinar on June 15, 2021 with experts from TCP on this topic. Participation is free. After registration you will receive a confirmation and a separate invite with the link to Zoom. All information and sign up here.
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