How Work Visas Affect Your Taxes

First, What is a Work Visa?

A work visa is permission from another country that lets a non-citizen work and live there part time. Essentially it’s a guest pass that allows you to legally work while visiting. We go into depth on what a work visa is in another article on our blog.

How Does My Visa Affect Taxes?

It’s simple – when you work in the U.S., you pay taxes on that income. It is the same when working in another country. However, it can get tricky depending on circumstances.

1. You might owe taxes in two countries now
   • If you’re working abroad, your home country might still want to tax your income, especially if you’re still a citizen
   • Additionally, the country you’re working in will want to tax the money you’re earning there
2. You may become a “tax resident”
   • For those who stay long term, you may become a tax resident – meaning you could be taxed on all your income, not just what was earned in that country
3. You might get taxed for things you weren’t expecting
   • Some countries tax for things such as:
     • Housing benefits
     • Moving costs
     • Retirement savings (if your employer contributes)

When To Get a Tax Advisor

If this sounds overwhelming to you, this is the best time to reach out to a tax advisor for assistance. They can help:

• Make sure you don’t pay more taxes than you need to
• Help you use tax treaties so you’re not double taxed
• File the right forms so you follow the rules and get any possible refunds or deductions

Example: Germany

Let’s say you’re from the U.S. and get a work visa in Germany. Here is what the tax situation could look like.

• Germany wants to tax your income because you work there
• The U.S. wants to tax you because you’re still a citizen

A tax advisor can help you identify and use any tax credits or treaties so you’re not paying taxes to both countries on the same money.

Don’t Pay What’s Not Necessary

While living abroad on a work visa, taxes can get complicated fast. That’s why it’s worth having a tax advisor in your corner. We are there to help you figure out what you owe (and what you don’t), make the filing less stressful, and help you keep more of your hard earned money. It’s a smart way to avoid surprises and stay in control of your money.