Brexit rules vs. reality
K2 recently partnered with Grant Thornton to deliver an informative webinar on the rules and regulations we are experiencing following the end of the Brexit transition period in Europe. As we all know, the UK and EU trade agreement was agreed very late, and businesses had little time to prepare. This webinar aimed to discuss how businesses coping, what has been working well so far, where are we seeing some teething issues, and highlight to the audience what businesses should be aware of.
The webinar was hosted by Grant Thornton, and K2 participated as key immigration experts, providing insight on both global and UK immigration.
The session covered the following:
- UK and EU Social Security
- Global Immigration
- UK Immigration
- Austria specific regulations
EU/UK Social Security — Verena Heyd, Associate Director, Grant Thornton
Verena gave an insightful overview into the regulations surrounding social security contributions, both before, and now post-Brexit. Before Brexit- Social security contributions are paid in the country in which you normally live and work. Under EU law, there are now new considerations.
Verena covered the changes to the ‘Posted Worker’ rules and highlighted how the term has now changed to ‘detached worker’. Verena then explored the Multi-state worker rules, before and after Brexit, and the liability of employers.
The session also discussed the transition period- for the UK leaving the EU, which ended on the 31st of December 2020. A1 applications will remain valid until their original end date. Further guidance from the UK/ EU tax authorities is to be expected.
Verena also discussed non-EU countries, who are not partners in the new social security agreement with the UK. These countries (Iceland, Norway, Switzerland, and Liechtenstein) have adopted temporary measures for now.
Finally, the session looked at some examples of social security obligations, and Verena provided a host of recommendations to tackle these obligations and potential impacts. Verena noted that it would be recommended to review all EU cross border populations and identify affected individuals, review the policies around extensions, medical coverage, voluntary contributions and who pays social security, and finally consider the length of all assignments before they begin.
Global Immigration — Craig Griffis, Global Immigration Manager, K2 Corporate Mobility
Craig presented to the group some interesting considerations surrounding global immigration following Brexit. He started the discussion by looking at residence rights, and what an individual would need to do to be eligible for residence rights in the EU, as a UK National. Craig noted the key dates for confirming residence in the EU (UK Nationals must be resident in the EU before 31 December 2020, in order to exercise freedom of movement. UK nationals residing in an EU country must have applied for a residence permit before the 30 June 2021).
Craig also explored the nuances between work versus business, when it comes to international travel, and noted that with business travel and visas, the regulations will be defined by each member state. For example, the duration of a stay with a business visitor status within the Schengen State area must not exceed 90 days within any 180-day period. Now the visa information system between European countries shares a high level of information and insight to travel patterns and movements, so it is important to keep a close track of days.
In addition, work permits will be defined by where the individual will be working. This may be hard to manage for people who are travelling to Europe and travelling across Europe. There will not be a European wide visa.
In terms of Covid-19, Craig highlighted that throughout Europe many countries are returning to lock downs and tight restrictions. A lot of countries are requiring negative Covid-19 test upon entry and requiring quarantines; so, it’s important to check the requirements of the country being visited. Also, moving forwards we will see the implementation of vaccine passports throughout the globe, whether or not the UK will be involved with this is unclear.
UK Immigration and Brexit — Simon Higson, UK Immigration Manager, K2 Corporate Mobility
Simon continued the immigration updates and focused on the impact of Brexit on immigration specific to the UK, and EU Nationals wishing to live and work in the UK. With regards to Brexit, Simon noted that we have 3 months left for EU Nationals to apply to the EU settlement scheme, where they will receive either settled or pre-settled status. This application will need to be made before the 30th of June, 2021.
In terms of the New Points Based System- Any EU citizen who have come to the UK to work after the 1st of January 2021, new employees will be treated the same as non-EU nationals and will need to use the New Points Based System and receive a certificate of Sponsorship. This system came into place on the 1st of January 2021.
With regards to the Sponsor Management System - now the system allows businesses to apply for as many sponsorship licences as needed and use this to assist entry clearance for new employees. Please be aware that there are certain requirements that need to be met, in order to receive a certificate of sponsorship (language, salary, job role etc).
Simon also highlighted some of the key Covid-19 concessions that have been issued by the UK Home Office, who have issued a number of relaxations of regulations in order to support employers and employees during the pandemic. For example, processing routes are opening up again, which is allowing travel to resume for many people who have been stuck in the UK. Simon warned all attendees to please be aware of significant delays in application processes and the consequences of these delays.
Christoph Schmidt — Head of Global Mobility, Grant Thornton
Finally, the session heard from Christoph, who provided an update from an Austrian perspective, looking specifically at inbound movement from the UK to Austria. To start with, Christoph gave an overview of the impacts and considerations involved when posting an assignee from the UK to Austria. The session looked at personal income tax consequences, for UK individuals working in Austria, and concluded that there are largely no changes of note to personal tax compared to the pre-Brexit era. If someone is resident in Austria, they are taxable in Austria.
In terms of social security, Christoph covered what requirements and contributions were expected, and how the changes to Brexit have impacted the usual working practices. Christoph also covered registration obligations (ZKO filings)- highlighting to the group that ZKO3 and ZKO4 filings are not valid for UK assignees in Austria anymore. These individuals will now need a work permit.
From a tax perspective, Christoph also highlighted that following Brexit, the UK are being treated as a normal ‘third country’ from January 31st, 2021, which in terms of processing and implications, this is different from before Brexit.
The session ended with a Q&A, where the panellists answered live questions from the audience. For any further information, please get in touch.
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Should you need any additional information, consultation, or guidance on any of the above, please do contact us as we would be delighted to assist you.
Additionally, if you would like to have a virtual coffee with any of our experts, please contact us we would be happy to arrange this.