Social security update and actions for employers.
If the deal goes through, the draft transitional rules are expected to apply to assignees and business travellers and they would cover assignments started within the transitional period to 31 December 2020 and as long as the working pattern remains unchanged. This means that employers should be able to continue obtaining A1 certificates during the transition period. Click here for our previous summary of the draft provisions.
Meanwhile, for current assignments if no deal is reached, it is possible that existing A1 certificates will become ineffective at 29 March, exposing employers and employees to host country social security, with a potential (but not guaranteed) opportunity to extend home coverage under a pre-existing bilateral agreement between the UK and the EU member state.
Again, if no deal is reached, new assignments and business trips starting after 29 March 2019 are likely to fall under either any pre-existing bilateral agreement between the UK and the EU member state, or there will be no treaty protection and the domestic legislation (including 52-week continuing liability to National Insurance for UK outbounds) will apply. Download list of existing bilateral agreements.
What should employers do now?
Regardless of whether or not a deal is reached in time for Brexit, employers need to start assessing the impact now of changes that will affect both current and future mobile employee populations into and out of the UK.
We recommend HR and tax professionals take the following actions now:
- Understand your current population
- Identify key compliance requirements
- Prepare to brief your business stakeholders
- Communicate to your mobile employees
In this article, we examine the consequences of a No-Deal Brexit including further detail on the above bullets.