Existing A1 certificates
These are issued by UK authorities to confirm an individual's liability for UK national insurance contributions while temporarily working elsewhere in Europe.
Will they end automatically or will they remain valid until the certificate’s end date?
Will social security contributions be required in both the UK and Luxembourg for seconded/multistate/commuting employees?
- UK government’s position: existing A1 certificates will remain valid until the certificate’s end date. It recommends employers check with the EU country’s authorities to find out if contributions may be due there, in case they no longer recognize A1s for example.
- Lux government’s position: domestic rules apply. For example:
- In principle, UK workers posted to Luxembourg will be covered by the Luxembourg social security scheme.
- However, employees are exempted from the Luxembourg social security scheme if the temporary assignment is under a year and they are covered by a foreign scheme. However, if the activity in Luxembourg exceeds three months, the employer must pay their share of pension contributions at 8%. The exemption can be extended by one year by the Centre Commun de la Sécurité Sociale (CCSS) and beyond by the Ministry of Social Security.
Will annual pension contributions already paid in the UK and the EU be paid out at retirement age?
- The EU Commission and the UK have confirmed that the “aggregation” in calculating pensions will apply to contributions paid and benefit rights accrued before the Brexit date.
- However, there is no agreement regarding contributions paid after Brexit. Responsibility falls to individual member states to negotiate with the UK on a bilateral basis.
Will social security contributions be required in both UK and Luxembourg for seconded/multistate/commuting employees?
- Currently, the European Health Insurance Card — or form S1 for longer stays — allows individuals to receive the same healthcare in another EU country as its locals.
- The UK government has unilaterally decided to continue funding healthcare benefits for UK nationals living in the EU for six months after Brexit. The two exceptions are Spain, with whom the UK has agreed a transition period until 31 December 2020, and Ireland, where current arrangements will continue to apply indefinitely. The UK is trying to negotiate a similar extension as it has with Spain across all EU countries.
Academic and professional recognition of qualifications
- Like any third-country national, UK nationals wanting their academic and professional qualifications recognized will need to produce a residence permit and meet the conditions of the amended law of 29 August 2008 on free movement of persons and immigration. A simple copy of their identity card will no longer be enough.
- Financial support for higher education will be limited to UK students with long-term residence status according to the amended law of 29 August 2008 on the free movement of persons and immigration.
Access to public service employment
British nationals will no longer be eligible for civil servant or employee of the State positions within the scope of Luxembourgish law. However, they can still be employed under private law via the budget law allowing the year-on-year recruitment of third-country nationals for the services of the State.
- British nationals who started an internship before the UK’s withdrawal can continue their internship afterward.
- British nationals arriving after the transition period and not benefitting from the withdrawal agreement are considered third-country nationals. Therefore, they must hold a residence permit under a category of the law of 29 August 2008 on the free movement of persons and immigration (as amended), which entitles them to a Luxembourg internship.
Posting of workers
The Inspectorate of Labor and Mines (ITM) checks whether the posted worker has, where applicable, a residence permit under article L.142-3 point 10 of the Labor Code. Brexit will restrict UK companies’ right to post workers to Luxembourg as well as the residency permits available to posted workers.
Some personal tax deductions are authorized if payment is made to an EU institution — e.g. charitable donations, contributions to life insurances or pension plans. Contributions made to similar UK institutions should be ineligible for personal tax deductions.