Expat remote working: things to note

Here is a guide on what to take note of when working remote:

1. Immigration and work pass requirements

One of the first considerations is whether the expat has the legal right to work remotely in the country they are residing in.

Many countries distinguish between tourism or short term visits and employment or business activities. Even if the employer is located overseas, performing work physically within a country may still require a valid work visa, employment authorisation, or a specific remote work visa.

Working remotely without proper immigration approval may result in visa breaches, penalties or deportation and future immigration complications. Expats should always confirm local immigration requirements before commencing remote work arrangements.

2. Tax Residency Issues

Remote working across borders can affect an expat’s tax residency status. Many countries determine tax residency based on the number of days spent in the country and the individual’s permanent home etc.

An expat may unintentionally become a tax resident in a new country if they remain there for an extended period while working remotely. This may possibly lead to personal income tax obligations, double taxation concerns, and additional tax reporting requirements.

Employers should also assess whether remote working arrangements create payroll withholding obligations in the host country.

3. Insurance and Healthcare Coverage

Expats working remotely abroad should confirm whether they remain covered under medical insurance policies, workplace injury insurance and employer liability coverage. Some insurance policies may not extend to overseas remote working arrangements.

4. Permanent Establishment Risks (Mainly for employers)

A significant concern for businesses is the potential creation of a “permanent establishment” (PE) in the country where the expat is working remotely. A PE may arise if:

1. The employee habitually concludes contracts;
2. The company has a fixed place of business; or
3. Business operations are effectively conducted from a remote location.

If a PE is created, the company may become subject to corporate income tax in the foreign jurisdiction, local filing obligations, and additional regulatory compliance requirements. Companies should carefully assess PE exposure before approving long-term overseas remote work arrangements.

5. Employment law considerations

Some countries may treat remote employees as locally employed workers even if their employment contract is governed by foreign law. Employers should review whether local labour laws apply to the remote arrangement.

Likewise, expats should check if local laws apply to them to ensure that their contract outlines their obligations and compensations fairly.