So, what does the government's initiative to attract location-independent professionals or Digital Nomads to New Zealand entail?. Unlike on-the-cheap backpackers, Digital Nomads are the cool kids who pack a laptop and earn big bickies while travelling. Ideally they spend some of the dough in the countries they're visiting, and might even stay permanently in them. Super tourists, if you like.
Because of that, lots of countries have specific and renewable Digital Nomad or other types of visas that permit remote work or self-employment, with conditions such as minimum incomes, travel health insurance, business plans and/or valid work contracts.
Some, like Czechia’s DNV, provide a pathway to residence. Czechia's DNV does that after five years, with citizenship on offer after 10 years.
France caters for self-employed or those engaged in “liberal activity” with a one-year renewable visa that requires at least €1800 a month income, €21,000 in savings, and which offers residency and citizenship after five years.
As the Beehive announcement makes clear, no such perks apply to remote workers arriving in New Zealand, on visitor visas.
What is going on here? I came across a post by McVeagh Fleming partner Arran Hunt on LinkedIn (yes, LinkedIn) that talked about the recent DNV announcement.
Hunt says: “can we please be clear that what has been provided is not a Digital Nomad Visa (DNV).”
In fact, little has changed on the visa front beyond clarifying that it’s now OK for visitors to the country to check work emails and a few other things, Hunt explained.
What's the official word then? Immigration New Zealand’s website says travellers on visitors’ visas are allowed to do the following:
- Answer emails and phone calls
- Coding and testing
- Writing reports
- Attend meetings and give presentations to colleagues outside New Zealand
- Create content as a social media influencer - as long as you’re not promoting an activity, event or product for gain or reward from a New Zealand business or person in New Zealand.
Tax obligations from remote work may arise for longer stays than 92 days in a 12-month period (or 183 days for those with tax residence in countries NZ has a tax treaty with) as well.
Hunt said the clarification that it’s now not a breach to do some work remotely like check emails is positive. He’s undoubtedly correct in saying that hardly anyone would’ve known that doing so in NZ, while on a visitor’s visa, was a breach of entry conditions.
Work for a New Zealand-based employer requires a work visa, as in the past.
Social media influencers probably won’t benefit from the visa changes, as Hunt pointed out. If they come to New Zealand, chances are they want to show off or promote something local. In that case, Immigration says they have to have a work visa.
“Will it [the visa changes] increase the number of people coming to New Zealand, and lead to these large increases in tax take? Probably not,” Hunt said.
It's possible that a proper DNV or similar permit would achieve some of that. What's on offer in New Zealand looks weak compared to what Digital Nomads have available in many other countries. Particularly so given our remote location and high cost of living.
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What is the target value proposition in selecting New Zealand for a digital nomad trip? Somewhere like Bali it is the stratified economy meaning that you can lead a life of luxury on very little income, whilst in places like France it is the allure of potentially settling there eventually.
Realistically, the sort of people who would have otherwise done a working holiday, but they're either too old, or would rather do their current job instead of toughing it out doing agriculture or tourism work for lower pay.
Interesting article though, the government's allowing people to do what they couldn't possibly police previously.
The key with a working holiday is that you are here for a year, you can do things like buy a camper, rent a place at regular rates instead of short term rates, buy a car, etc. I suspect that being nomadic for 90 days isn’t all that appealing. Where it could work is if your partner is a kiwi and you want to check out NZ before deciding if you want to live here, I guess.
When/if we actually get a Digital Nomad Visa, it certainly needs to be done carefully.
We see some countries where a Digital Nomad Visa has provided a benefit, due to the spending, but these are generally countries with a lower cost of living, with a backlash in countries that are more developed. In New Zealand, it needs to be balanced against any impact they would have on the housing stock, as there is less to be gained by the country if it is pushing up rent costs but not providing taxable income. We also need to consider other costs like our obligations under ACC. Perhaps, especially when looking at influencers, a simpler tax regime and visa combo may be better. Either way, an actual Digital Nomad Visa could actually be detrimental for NZ, unless very carefully designed and worked through.
I doubt most people, working remotely while travelling, reaslised they were breaching the rules, and I've only heard of Immigration New Zealand raising it as an issue once (and that wasn't for a client of mine, but I heard about it from a colleague). I know that when I travel, I keep working, and I do realise that I should have a look as to if I'm going to be breaching the rules anywhere else.
What the government has done here is a small but common sense fix. Nothing more than that.
Not gonna lie, as someone who speaks French their DNV with path to citizenship looks very attractive.
I've travelled to some of the places that offer digital nomad visas and generally observed how things tick. It all sounds very 'groovy' but they offer very little to the GDP or productivity of the host nation. Meanwhile, the nomads themselves enjoy many of the benefits of residency status..... until they find the next hip/groovy country. Let them come on a standard tourist or working holiday visa and do what they do. The IRD won't be able to track their earnings anyway. Along the way they'll be spending those earnings within the New Zealand economy.
Creating a visa so that visitors can do what they're already doing. What a waste of time and money.
I work as contractor to US clients and if I went overseas I would simply work from wherever I am and continue to pay my tax here in NZ. I'm sure that's what visitors who can work remotely do when they're in NZ.
They didn't actually create a visa, they just changed a couple of lines on the current visa to clarify that you could work remotely, and then provided it as if it was a new visa. It's still the exact same visa we've had for years.
Hunt said the clarification that it’s now not a breach to do some work remotely like check emails is positive. He’s undoubtedly correct in saying that hardly anyone would’ve known that doing that in NZ, while on a visitor’s visa, was a breach of entry conditions.
This is a really weird framing. The list is to clarify that you can do work activities that are genuinely remote working for overseas businesses; but can't do things that actually require you to be in New Zealand to do (eg, setting up a business/subsidiary to sell to NZers, working for a multinational that operates in NZ).
It's meant for exactly the demographic it says: "Digital" (ie, computer/distance based) "Nomads" (people who stay in a place for a while and move on). Why should it come with any residence perks?
The confusion was caused by how Immigration New Zealand defines work, and whether it's definition of work included work done for offshore companies that would be paid offshore. The change clarifies that it doesn't.
It goes beyond just digital nomads. For example, an accountant visiting from the US would have likely breached the terms of their visa, granted as a waiver at the border, by checking their emails. Equally, a teacher from Vietnam would also have breached the terms of their visa, granted after applying for a General Visitor Visa, if they spent a few minutes drafting up a lesson plan for when they return home. It could be a mechanic from Bulgaria responding to his employer's email about a vehicle she repaired just before coming to NZ for a two week holiday.
This correction impacts everyone who visited New Zealand on a visitor visa, whether applied for or granted as a waiver, whether they naturally worked online or not. It could impact Digital Nomads, but it certainly isn't aimed at them, nor does it give them anything different than they had before, apart from certainly that they can work remotely which it gives everyone. It impact Digital Nomads in the same that any other visa might just because they fall in within the massive number of people who can apply for a visitor visa or get one on arrival at the border.
And then there are the tax obligations they may fall under if they are here for more than a few months.
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