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Brexit update on social security provisions

Jacqui Bickerton explains UK nationals working in the EU, must understand their obligations to the social security following the transition period.

Where are social security contributions paid post Brexit?

For those UK nationals who work temporarily in the EU, it is important for them to understand their obligations in relation to the payment of social security contributions following the end of the transition period.

The Trade and Cooperation Agreement between the UK and EU reached on 24 December 2020 includes a Protocol on Social Security coordination ("the Protocol“) which took effect on 1 January 2021. The Protocol aims to protect the social security entitlements of EU citizens and UK nationals after 1 January 2021.

What will UK nationals have to pay in Europe?

There is no 'one size fits all‘ approach. The social security payment requirements depend on the individual circumstances and the EU country in which the temporary work is performed.

The general rule, post Brexit, is that an employee or self employed worker will pay their social security contributions in the country in which they work. However, if a UK national is going to be working temporarily in the EU, Norway, Iceland, Switzerland or Liechtenstine, then it may be possible for them to be able to continue paying their contributions in the UK during the period of temporary work in the EU and not have to pay social security contributions in the EU country where the temporary work is actually taking place.

How can this happen?

There are two options:

Option one

The UK national can apply for a certificate from HMRC if:

  • the work being performed in the EU is on a temporary basis; and
  • one of the criteria is satisfied.

By way of example, one of the criteria referred to above includes a multi state worker which means that, if the UK national was working in two or more countries of the UK, EU, Norway, Iceland, Switzerland or Liechtenstine before 1 January 2021, and continues to do so (and the work is predominantly in the UK), then the UK national will be eligible to apply for a certificate from HMRC.

The certificate, if granted, means that social security contributions will be paid in the UK only, even when the work is being temporarily performed in the EU. This would remove the need for the UK national to pay social security contributions to the EU country in which the temporary work is being performed.

Option two

The criteria in option one is quite restrictive. If the UK national does not fall into one of the criteria, then it may still be possible to apply to HMRC for a certificate under the detached worker rule. A detached worker is a UK national working temporarily in the EU.

If the UK national is going to work temporarily for up to two years in an EU country and, importantly, that country has agreed to apply the detached worker rule, then the UK national can apply to HMRC for a certificate. Similar to option one, if the certificate is granted by HMRC the UK national would only need to pay social security contributions in the UK and not the EU country.

An EU country must specifically agree to apply the detached worker rules. If this has not occurred then the UK national would need to pay social security contributions in the EU country where the temporary work is performed.

It is recommended that enquiries are made by the UK national before the temporary period of work in the EU commences to avoid any later liabilities arising. For further information see the Government guidance.

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