With the start of the coronavirus pandemic, humanity reassessed its approach to global travel. This also affected the work process. The demand for remote work skyrocketed. Even though many would prefer to return to their offices after the lockdowns, it had become clear that meetings in person were not really needed. Today, it is possible to work from anywhere just as efficiently as from the office: in a digital technology-driven world, it is easy to access the needed resources remotely. Unsurprisingly, such a situation benefits the companies involved in developing respective technological solutions. If one can work remotely, then one can work from any place with an internet connection. As a result, the competition intensifies between those employers who strive to hire talented staff, especially in the IT industry. However, it is not only software developers who can work remotely but any kind of professionals who just need a connected laptop to do the work.
Countries have started to compete not only for energy, technology, and financial resources but also for human capital. And today, the scale of the competition is unmatched. It would have been natural to assume that the pandemic and the lockdowns would result in a polarised and regionalised world. But no such thing happened. Globalisation has accelerated; the world has become ‘even smaller’, competing for the most valuable resource: human talent.
One of the human capital race results is the launch of the digital nomad visa, which helps countries attract international talent. In this article, we explore how digital nomads can get this type of visa in some European countries.
What is a digital nomad visa?
A digital nomad visa, also known as a freelancer visa, is a residence permit allowing holders to stay in the country for a longer term and work remotely, earning income abroad. Such visas are often issued under a simplified procedure compared to other ways of securing an official status in a foreign state. Strictly speaking, it is not even a visa but a government programme facilitating the issue of a residence permit.
As a rule, under the programme, the residence permit is issued for one year; afterwards, it should be extended on the same basis of its holder being a digital nomad. Nevertheless, there may be other grounds for extending the residence permit, such as employment in the hosting country, marriage, and so on. In any case, if participating in the digital nomad programme, the application for the visa is a separate procedure. Some countries even require the candidate to rent a place to live and open a bank account prior to applying.
The IT crowd is usually viewed as the most common beneficiaries of the digital nomad visa scheme. But it is a myth. Employment in the IT industry is not a must to be able to participate in such programmes. The main requirement for obtaining a digital nomad visa is to have a certain level of income generated abroad. Overall, the visa is ideal for freelancers.
Digital nomad visa in different countries
Currently, over 50 countries around the world offer digital nomad visas. Here we focus on several European states, namely Portugal, Cyprus, Spain, Hungary, Germany, and Croatia.
Let’s have a look at the potential benefits of a digital nomad visa as well as at the application process and how much time it takes to obtain the respective status and the visa.
Portugal freelance visa
Portugal launched the digital nomad programme in October 2022. Getting the residence permit as a digital nomad will take some time, but after five years of continuous residence, you are eligible to apply for naturalisation. You need to prove an income of a little over €3,000 in each of the three months preceding the application.
There are two types of the Portuguese digital nomad visa. One is a temporary stay visa, whose name implies a temporary residence for up to 1 year. The other one is a residence visa issued for a period exceeding one year. The application for an entry visa can be submitted at a consulate or a visa centre in the country of residence but not in Portugal.
Those freelancers who have secured this type of visa say that it is issued for a period of up to 4 months. In other words, you have four months to enter the country and apply for a residence permit with the Portugal immigration department (Serviço de Estrangeiros e Fronteiras — SEF). It is also possible to apply for a digital nomad visa, having entered Portugal under different grounds.
It should be noted that the main applicant’s family members are also eligible to apply. As reported by Portuguese digital nomads, it takes two months or more to process the application. At the same time, an entry visa can be granted within two to 60 days, depending on the applicant’s nationality. Portugal tax residents are subject to progressive taxation, which depends on the size of their income. The rate varies between 14.5% and 48%.
To get a residence permit as a digital nomad, you need to submit documents proving your remote employment with a foreign company or contracts with foreign clients if you are self-employed. An important feature of the Portuguese programme is the requirement to submit a tax residency certificate issued by the country where you pay taxes. If you are not officially employed/contracted, have no official income, and do not pay taxes, then you are ineligible for a digital nomad visa in Portugal.
When applying for a Portuguese digital nomad visa, another peculiarity is the requirement to submit a local rental agreement. However, according to those digital nomads who have already been through the process, one can submit an online booking from Airbnb or a similar platform, which can be cancelled immediately after the application.
Residing as a digital nomad in Cyprus
One advantage of getting a digital nomad visa in Cyprus is that a Schengen visa is unnecessary; also, after the residence permit is granted, the beneficiary can travel outside the country. The income requirement is at least €3,500/month per adult family member and about 15% of the amount per child. Interestingly, the income may come from any source; you just need to prove it with respective documents. Those can be an employment agreement if you are employed or proof of passive income such as rent, dividends, interest on savings or other types of assets. In addition, the digital nomad visa application must be supported with a local long-term rental agreement or a title deed for residential property in Cyprus.
To enter the country, nationals of some countries in Eastern Europe and the South Caucasus will have to obtain a visa. One way is to apply for a national tourist visa. Entry is also possible for holders of a Schengen visa even though the country is not part of the Schengen area. In addition, Cyprus, Romania, and Bulgaria have signed an agreement on the mutual recognition of their national visas. It means that entry to Cyprus is allowed on a multiple-entry visa issued by Bulgaria or Romania. Until recently, Croatia had also been part of the agreement, but the state joined the Schengen area in January 2023, and the agreement with Cyprus, Romania, and Bulgaria had been annulled.
Once the candidate has entered Cyprus, they need to apply for a digital nomad visa at a local immigration unit. The residence permit is usually issued for one year and can be extended for two more years. In most cases, settling the formalities between the application and the issuance of the residence permit takes about six weeks. It is important to keep in mind that the members of the digital nomad visa applicant’s family can apply at the same time.
There is a limitation that the permit holder cannot leave the country for more than 90 days. Also, as with similar programmes in most states, Cyprus does not allow digital nomads to engage with local employers or clients.
Digital nomad visa in Spain
The Spanish freelancer visa is one of the most recent programmes for digital nomads, which was launched in the first quarter of 2023. It is a long-term residence permit, which is, however, accompanied by a rather high, even if fixed, income tax of 24%.
The application must be made at a Spanish consulate or embassy. One can enter Spain on a tourist visa and then apply at an office of the Ministry of Inclusion, Social Security, and Migration (Ministerio de Inclusión, Seguridad Social y Migraciones). According to those familiar with the procedure, the application should be processed within approximately 30 days.
If the outcome is positive, then the residence permit is granted for three years. This is the longest digital nomad visa among European countries. Besides, the documents are issued faster than elsewhere. But, the 3-year visa is offered only to those who applied within Spain. Otherwise, the permit is granted for a year and can be extended for two more years. If all the requirements are being met, the visa can be extended for up to 5 years, and afterwards, there is an option to apply for a Spanish permanent residence permit. After five more years, one is eligible to apply for naturalisation.
Those applying for a digital nomad visa in Spain must:
- have a monthly income of at least €2,500. If the family members are included in the application, the applicant’s income should be increased by €945 for the spouse and by €315 for each child or other family member regardless of any income the others might have. For example, for a family of two adults and two children, the applicant must provide proof of income of at least €4,075,
- Be able to provide:
- An employment/service agreement showing that the applicant is not employed/contracted by a Spanish company
- A proof of working remotely for at least three months before application. This should be supported with a bank statement showing the flow of funds for these months
- A proof of qualification, e.g. of experience in the field for at least three years.
If the applicant for a digital nomad visa is a freelancer, they must prove that their clients are legal and not physical persons. The proof can be service agreements and such. The digital nomad’s family members can apply at the same time.
Croatia issues digital nomad visas for one year
It is possible to apply for the national digital nomad visa in Croatia remotely; however, the rules of the programme allow no extensions. Once your visa has expired, you will have to leave the country and can reapply in a year’s time. This is not an immigration permit but a visa implying that its holder would live and work in the country for a year and then set out for a new destination. Basically, that’s what nomadism is, digital or not.
Therefore, if you would like to settle in Croatia for a longer period, you should enter the country under different grounds. For example, you may have a student or work visa. A continuous residence in Croatia lasting five years gives the right to apply for a permanent residence permit.
One of the eligibility criteria is for the digital nomad to have a monthly income of at least €2,400 plus €240 for each family member. Other criteria include:
The digital nomad’s family can apply after the main application has been approved, on the grounds of family reunification
Neither family members nor the digital nomad are allowed to be employed by a local company
Holders of a digital nomad visa can leave Croatia for up to a month, whereas the total period of absence within a year cannot exceed 90 days. Otherwise, the visa is cancelled. If, for some reason, the visa holder has to stay abroad for a longer period, they must obtain respective permission at the immigration department that issued the residence permit.
After the online application has been submitted and approved, the applicant must obtain a so-called visa D; it can be done at a visa centre, an embassy, or a consulate of Croatia. At the same time, if the applicant is planning to enter the country on their own, a Schengen visa (if they hold one) suffices. However, if the applicant is bringing their family with them, the family members cannot enter the country on a Schengen visa. The dependents who accompany the digital nomad visa applicant must get their visas D even if they hold Schengen visas.
An online visa application implies that the applicant and their family must enter the country within a month’s time. Upon arrival and while waiting for their application to be approved, they must rent an accommodation and register with the local police. The average waiting period is about 120 days.
Despite some apparent complications compared to similar programmes in other countries, the advantages of the Croatian programme are not to be overlooked. First, this is the only scheme in Europe with the option of applying remotely. Second, no annual health insurance or rental agreement is required. Third and the most important, the Croatian digital nomad visa does not include tax residency, which means there are no tax obligations.
Hungary only issues visas to single digital nomads
In early 2022, Hungary launched its own national residency programme for digital nomads called the White Card. Eligible participants include both employees and business owners or co-owners. The main condition is for the source of their income to be abroad. The applicants must:
- have a net monthly income of €2,000
- be employed in the digital technology industry
- provide an employment agreement indicating the size of income if the applicant is an employee
- provide a bank statement for the six months preceding the application
- have a long-term local rental agreement
- pay an pplication fee of €100
It is not mandatory to be in Hungary to apply. It can be done in any state where there is a Hungarian consulate or embassy. The applications are processed by the National Directorate-General for Aliens Policing of Hungary within 45-60 days. Upon completion, the same authority issues the residence permit, valid for one year, with an option for an extension for one more year.
Once the application has been approved, the beneficiary must obtain a single-entry visa and enter Hungary within a month’s time. Like Croatia, the Hungarian programme stipulates that the residence permit is cancelled if its holder stays outside of the country for more than 90 days within a year.
The income of digital nomads is taxed at the rate of up to 15%, and the first six months are tax exempt. An interesting limitation: the period spent in Hungary on a digital nomad visa is not considered for the purposes of obtaining a long-term residence permit or naturalisation. Therefore, for those who are planning to tie their future to Hungary, the digital nomad visa might not be the best option.
No threshold on digital nomads’ income in Germany
The German digital nomad visa is much more than just that. It is a comprehensive programme available to any foreign citizen who is capable of making a substantial contribution to the country’s economy or culture. Among those who have benefitted from the German freelancer visa are many creatives such as designers, architects, writers, directors, scriptwriters, photographers, artists, and so on. It would be more appropriate to call it, in the British manner, a talent visa.
The visa is granted for up to 3 years. Afterwards, the foreign national is eligible to apply for a German long-term residence permit. The standard application procedure is to personally visit the immigration office in Berlin with all the necessary documents; the appointment must be scheduled online in advance. You might wonder why it is Berlin specifically. That’s because the programme beneficiaries – digital nomads or ‘talents’ – may only reside in Berlin.
All applicants except for Turkish nationals must pay an application fee of €100. In most cases, the residence permit is issued in about 30-60 days after the submission of documents.
The most fascinating and complicated thing about the German digital nomad visa is taxation. Usually, the foreign holder of the digital nomad visa acquires German tax residency if they reside in the country for more than 183 days a year. However, even if you have spent less than that in Germany, the authorities may still consider you a tax resident, for example, if your children have been enrolled in a German school in that year.
There is a progressive income tax with a rate of up to 45%. If your annual income is less than €9,700, it is tax exempt. Earnings between €9,700 and €57,900 are taxed at 14% and so on.
