So? Can you pay $0 in taxes as a digital nomad? Depending on your situation and how you play your cards, it is indeed possible. But, it’s not necessarily the be-all and end-all. There are many factors in play when it comes to digital nomad taxes, from citizenship to residency to employment status, company structure, and much more. Learn more below!
Kathleen Di Paolo is the founder and CEO of Wanderers Wealth. Her goal is to empower digital nomads, entrepreneurs and all other wanderers of the world with global financial freedom. She is an expert in international tax issues, international corporate structuring and global residency matters.
In this interview we discuss how Kathleen came to be an international tax expert, tax strategies for digital nomads and entrepreneurs, considerations for remote workers who want to work from abroad, how companies can reduce (or eliminate!) their tax liabilities, Kathleen’s personal journey as a digital nomad and lifelong traveler, and advice for aspiring digital nomads and remote workers.
See Also: 3 Ways Aspiring Digital Nomads Can Earn Money and Save Tax
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Running a Remote Real Estate Business with Matt Bowles, Maverick Investor Group
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Jump right into my Awesome Interview Series videos on YouTube here – and please give it a thumbs up, leave comments and subscribe!
Meet Kathleen Di Paolo, of Wanderers Wealth
Kathleen’s career started in international relations and diplomacy, and her desire to help people led her to become a lawyer. In her legal career, she became an expert on different tax systems internationally.
But eventually (not unlike myself back in 2006), her desire to travel the world extensively trumped her career, and she quit her job to travel.
While she was traveling, she met many digital nomads who were running their businesses from their laptops. In speaking with them, she realized they had no idea what to do with their taxes, and as soon as they learned of her international tax expertise, everybody wanted a piece of her. Her personal curiosity led her to learn more about various tax residencies and opportunities for digital nomads, and she soon realized she could start charging for her knowledge and advice. And so was born her own location independent business: Wanderers Wealth.
Her services include one-on-one consulting, online courses, and more.
Check out Kathleen’s FREE Tax Residency Webinar
And her mini course on Low Tax Business Setup
Or her Global Tax Strategy Design Course
Watch our Chat!
Have a gander at our conversation below, or by clicking this link to watch on YouTube.
Digital Nomad Tax Planning
Kathleen and I discuss various opportunities and ideas surrounding digital nomad tax planning, including:
- What you need to know before you start strategizing tax relationships with other countries.
- The importance of making the most of current tax breaks and opportunities for digital nomads and remote workers right now.
- Some loopholes of the past for digital nomads in terms of visas and how that’s changing.
- 10-year tax exemption scheme in Portugal.
- The advent of digital nomad visas in countries like Croatia.
- Whether or not you need to continue to pay tax in your home country while living and working abroad (even with a special tax-free digital nomad visa).
- In some cases you can structure things so you don’t have to pay tax at home or abroad! But there are many different factors involved.
- Disadvantages to not having tax residency in any country (and yes, there can be some disadvantages!).
- What happens if you sever your tax residency with your home country but later decide to return home and re-establish tax residency.
- The danger of returning home for too long if you have severed tax residency.
See also: Digital Nomad Taxes – Everything You Need to Know
Digital Nomad Taxes: Tax Planning Considerations for Remote Workers
Remote workers (as in people who continue to work abroad for an employer with a standard employment agreement) have some different tax considerations. I peppered Kathleen with questions and we discuss:
- The first thing to consider as a remote worker considering working from abroad.
- Should you tell your employer you’re going abroad?
- In some cases if a remote worker establishes tax residency in another country where the company isn’t located (or where a tax treaty doesn’t exist between countries), this can trigger a tax obligation on the part of the company.
See also: Tax Consequences of Remote Work Visas
What Wanderers Wealth Does
Kathleen works with remote companies, digital nomads, and remote employees to optimize their tax situation based on their lifestyle and location. We discussed:
- How Kathleen designs clients’ tax strategies around their lifestyle.
- How she helps employers and businesses determine the tax consequences of allowing their employees to work remotely.
- How companies can hire and streamline their practices to reduce their tax liabilities.
- Working with Kathleen also means having access to her large network of accountants and lawyers around the world.
Her services include one-on-one consulting, online courses, and more.
Check out Kathleen’s FREE Tax Residency Webinar
And her mini course on Low Tax Business Setup
Or her Global Tax Strategy Design Course
Kathleen’s Personal Digital Nomad Lifestyle and Remote Work Habits
I love discovering what inspires people to hit the road, and then what keeps them on the road and how their lifestyle evolves. Here’s what I discovered about Kathleen:
- Her pace of travel pre-pandemic (hint: it was ridiculously fast!), and then how it changed during the pandemic.
- Her sweet spot for how long she likes to stay at a destination.
- How she achieves a healthy work-life balance while traveling full-time.
- The challenges of doing consulting work while traveling and changing time zones.
- Kathleen’s vision for the future of her digital nomad lifestyle.
- The advantages of having a few familiar places to return to periodically.
- Why Kathleen enjoys co-working and co-living spaces.
- The beauty of traveling with other digital nomads who understand remote work habits and the “daily grind” of working while traveling.
- Traveling and living with digital nomads, and whether it comes at the expense of having a culturally immersive and “local” experience.
Advice for Aspiring Digital Nomads
I’m so glad I asked Kathleen about her advice for digital nomads and remote workers, because she touched on some really important things, like:
- Why Kathleen believes just going for it is the best advice for aspiring digital nomads.
- How experience and collaborations on the road can lead to new career ideas and streams of income (as it did for her).
- The importance of planning your career and lifestyle, but not so intricately that it comes at the expense of seizing new opportunities.
- Her thoughts on travel budgeting and how much money one should save up for a travel lifestyle.
- Why money stress on the road is 10 times harder than money stress at home. (Nora’s Note: Amen; money stress was a big factor in my first breakup on the road).
