New Zealand Digital Nomad Visa

Earlier this week the New Zealand government announced what they have called a ‘Digital Nomad Visa’. This was part of the National Party’s election manifesto in 2023.

These DNVs of course have become incredibly popular around the world thanks to our ability to work remotely and earn an income, very often from wherever we have a Wi-Fi connection.

Digital Nomad Visa Stay Duration

I was contacted by a journalist a couple of days ago who could not understand why most countries have a Visa of this type valid for between 12 and 24 months but New Zealand announced one of only 9 months.

I explained it because it’s not really a Digital Nomad Visa in the sense of that name. It is more clarifying who can work remotely while in New Zealand on a temporary visa such as a Visitor Visa around which there has been confusion for many years.

Creating a whole new visa category would require a whole lot of IT work inside the Immigration Department and rather than delay things, the Minister has clearly convinced her colleagues, sensibly in my view, that a Visitor Visa can serve the same purpose.

The only downside in rolling this out quickly is it’s shorter than similar Visa types in other countries.

Changing Nature of Work and Need for Updated Rules

There has been inconsistent advice and enforcement of work rules down the years by Immigration New Zealand simply because the nature of work has changed. To be fair to the immigration bureaucrats it is a case of the politicians not giving them the tools they need in a world where people can be working for an employer based on one continent while they are lying on the beach on a different continent.

It has caused real confusion as to what is ‘work’ when you’re on a Visitor Visa and really needed urgent clarification because the rules defining work were written in an age of letters, fax machines, going to the office or workshop, working from 9 to 5, making calls on landlines, no Internet and no Wi-Fi. When those rules were written I could only imagine the world where you could do your work on a laptop sitting in a cafe on the other side of the world from where your employer is based.

Common Sense Approach to Defining Work

I wrote recently of the Immigration Department threatening to deport a young man from the US who was in New Zealand filming his adventures and posting them to his 33 million followers on YouTube. He wasn’t denying any New Zealander an employment opportunity and was not taking money out of anybody’s pocket. In fact, quite the contrary – he was a one man band tourism promotion band for New Zealand.

There was some argument, or at least confusion, as to whether he was working or not and therefore in breach of his Visitor Visa.

In my view he did not need a Work Visa. Some disagreed with that and not without some justification although in terms of the spirit and intent of what defines work and who needs a work visa for me the obvious common sense conclusion was he was operating within the rules of the visitor (tourist) visa he was on.

The changes announced this week packaged up as a Digital Nomad Visa would have made it very clear he was not breaching the terms of his visa.

Legal Entitlement to Work on a Visitor Visa

To put it simply, if you are in New Zealand and working for your overseas-based employer while on a Visitor Visa, you are being paid offshore and not servicing any NZ based clients of your employer then you are legally entitled to ‘work’ here without needing a work visa.

Tax Residency Rules for Remote Workers

Visitors can stay in New Zealand for nine months out of any consecutive eighteen so anybody who wishes to work remotely while in New Zealand needs to be aware of tax residency rules. I am not a tax expert but as a general proposition any person, irrespective of the kind of visa they hold while in New Zealand, who spends an aggregate 183 days out of any consecutive 365 has just become a tax resident.

Therefore they are required to file a tax return in New Zealand declaring their worldwide income. If New Zealand has a double tax agreement with the country in which you earned other income you won’t necessarily be paying tax twice but there are some situations where you may.

I would suggest anyone who fancies working remotely in New Zealand for at least 6 months then gets some good tax advice to make sure you don’t fall foul of potential double taxation.

If you don’t stay for longer than 183 days/6 months you should be okay but any more than that the risk certainly increases.

I have to say our Immigration Minister has shown she listens and is willing to make changes that reflect the age in which we live and which are rational and logical. I don’t ever expect visa assessments to be simple, they are by the very nature complex decisions because you need to say yes to some people and no to others but even so the announcement this week, clarifying who can work remotely is welcome, rational and  logical and I applaud the government for doing what no government before them in my 30 years of practice has been willing to do.