Monday, August 01, 2016

Digital Nomads: Working in the Bureaucratic Grey

Photo: Canice Leung
It’s hard to believe that it’s been almost exactly a year since I moved to Australia.

As I write this, I’m on a train chugging through the Welsh countryside, the passing rivers and farmhouses a blur against a bright green backdrop. (On one of our daily hikes, Canice used the word “bucolic” to describe the scenery—placid valleys filled with sheep, the iconic stone fences running parallel to the sea—and I’ve been rolling it around in my mouth every since. After two weeks of standing out in a sea of arthritic tourists, I’m left sincerely wondering why Wales isn’t more popular with my demographic. Sure, it’s no Ibiza—but it’s breathtaking, and really, what more do you need?) Today, I’m headed to Heathrow to start the epic journey home after nearly two months abroad.

“Home,” in this particular context, is Sydney. Since my working holiday visa has ended (as a 32-year-old young professional, picking fruit for three months—and dealing with pesticides, bed bugs and beligerant backpackers in the process—all to extend my visa for another year wasn’t exactly an appealing prospect), I’ll be re-entering Australia on a tourist visa.

In the process, I’ll also be entering a bureaucratic grey area; although I’m trying to do everything by the book, the book has yet to be written for my particular set of circumstances.

While everyone from Forbes to Verge Magazine (the latter being written by yours truly) is touting the benefits of location independence and “digital nomadism,” I’m still skeptical that the world is quite prepared for it. Here are just some of the problems that I’ve encountered:

Being a digital nomad often means having to flaunt (or ignore) visa restrictions.

Most visa laws were established pre-Internet, based on the assumption that one has to be physically present in a country in order to work in a country. As a consequence, there is often no middle ground between business and pleasure. And yet, I'm neither; I'm not a tourist, but I'm also not technically working in Australia.

So before I last left Sydney, I visited the immigration office to seek advice on how I should re-enter the country.  My only real option was to apply for a tourist visa, but I wanted to disclose my intention to continue to freelance from Australia.

Initially, the immigration officer on-duty told me that this wouldn’t be possible—after all, the purpose of a tourist visa is, well, to be a tourist. (Y'know, to hug koalas and take selfies in front of the Opera House and stuff. Strangely, most tourists are more interested in sightseeing than operating a small home business.) I went on to explain that my clients are all Canadian, which changed his response. After conferring with a colleague, he told me that I could continue to work, provided that I don't take on any Australian clients.

Fine. Except that I don't have that in writing. And that policy isn't set in stone. And although I’ll be contributing to Australia’s economy while reaping very few of the benefits (which basically makes me the ideal tourist/in-country squatter), if the wrong immigration officer looks at my file, there’s a chance I'll run into problem at the border during one of my mandatory (and costly) visa runs. Great.

Being a digital nomad may mean losing business. 

So you know that stipulation about not taking on Australian clients? It turns out that determining where your clients are located is easier said than done.

Case in point: I work for one Sydney-based company. However, my editor is in New York and their client (who I write copy for) is Canadian—and, as a consequence, they wanted a Canadian writer. (In fact, my editor didn’t even know that I live in Australia.)

In a globalized economy, it’s not only freelancers who are no longer limited by physical location—employers can hire telecommuters from anywhere. Accepting a job from an Australian client doesn’t necessarily mean that I’m taking a job away from an Australian.

Physical location has very little to do with my line of work. However, based on current visa laws, I can’t work for an Australian client while I’m physically in Australia—but when I’m in Canada or travelling, I can do all the work I want for Australian clients.

Being a digital nomad may mean losing health care coverage. 

You have to pay taxes somewhere. Emancipating yourself from your home country for tax purposes (or becoming a "tax non-resident") is complex. As a consequence, many digital nomads elect to maintain a permanent address in their country of origin. In my case, I have a permanent address in Toronto, which I use for all government correspondence including health care.

Last year, I made the error of being honest (to a fault) and disclosing to OHIP (Ontario’s health care plan) that I was taking an “extended absence” from the province. This means that as of next August, I will lose my coverage—despite the fact that I continue to pay income taxes (not to mention remit HST) exclusively in Ontario.

Instead, in order to maintain OHIP, I’m expected to be physically present in the province for 153 days of the year. Why? Because the government assumes that the only way one can pay income tax (and ultimately, for services such as health care) is if they are physically working there. (Why should it surprise me that the government operates like the Internet doesn't exist?)

I’m currently going through an appeal process with OHIP, which I hope will be successful. However, on the off-chance that I do lose my coverage, I’ll also become ineligible for my travel insurance plan—which would render me without health care in both Canada and Australia. Fun, right?

Being a digital nomad means that your taxes are going to be very, very, very confusing. 

I won’t bore you with the nitty-gritty, but basically all the language pertaining to small business tax in Canada assumes that you are physically in Canada.

For example, in order to remit HST payments properly, you have to determine where you “make” a product. But what if I research a story in Canada, write half of it in Wales, and then submit my final draft once I’ve returned to Australia? Even my accountant, who specializes in working with freelance writers, grapples with how to advise me on these situations.

The truth is that digital nomadism, particularly in countries where it's harder to fly under the radar, isn’t all that it’s cracked up to be.

So, our next step? Starting to investigating my de facto visa—and saving up for its accompanying $7,000 price tag.

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