National Insurance Contributions for Employees Working Abroad

UK businesses whose employees are working abroad may now apply to HMRC to find out if they need to continue paying National Insurance Contributions.  The service was updated in January 2021 and applies if you’re sending one or more employees to work temporarily in Iceland, Liechtenstein, Norway, Switzerland, or a country within the EU.

If you’re an employee, self-employed, or an employer, where you pay social security contributions will depend on your circumstances and the country you are going to work in.

If an employee works in the EU, Norway, or Switzerland, they will only have to pay into one country’s social security scheme at a time. This will usually be in the country where the work takes place.

Working in the EU

You, or your employer, should apply for a certificate or document if you are:

• going to work temporarily in the EU for up to 2 years
• a multistate worker working in the UK and one or more EU countries
• a civil servant working for the UK government
• working onboard a vessel at sea with a UK flag
• working as a flight or cabin crew member, where the home base is located in the UK

Working in Iceland, Liechtenstein, Norway, or Switzerland

You, or your employer, should apply for a certificate or document to continue to only pay National Insurance contributions in the UK if you are a:

• national of the UK, Iceland, Liechtenstein, Norway, or Switzerland who started working in Iceland, Liechtenstein, Norway or Switzerland before 1 January 2021 and have been working there since
• national of Iceland, Liechtenstein, Norway, or Switzerland, who was resident in the UK before 1 January 2021, including if you have EU Settlement Scheme status
• family member of a national of Iceland, Liechtenstein, Norway, or Switzerland who has status under the EU Settlement Scheme, and you are residing in the UK
• person with dual nationality, one of which is the nationality of Iceland, Liechtenstein, Norway, or Switzerland
• national of the UK, Iceland, Liechtenstein, Norway, or Switzerland who is a multi-state worker, meaning that you were working in 2 or more countries of the UK, Iceland, Liechtenstein, Norway, and Switzerland before 1 January 2021, continue to do so, and work predominantly in the UK

You may also be able to apply for a certificate or document if you’re covered by any of the other conditions in the EEA-EFTA Separation Agreement or Swiss Citizens’ Rights Agreement.

Those not covered by one of these agreements, may still be able to apply to HMRC for a certificate or document to continue to pay National Insurance in the UK if you’re going to work temporarily in the following countries:

• Iceland
• Norway
• Switzerland

Norway

You should apply to HMRC for a certificate or document to continue paying UK National Insurance contributions if you’re working temporarily in Norway for up to 3 years. You should apply for a certificate or document before you go to work temporarily in Norway but must apply within the first 4 months of going to work there. This means you will not have to pay social security contributions in Norway for that duration of work.

Switzerland

You should apply to HMRC for a certificate or document to continue paying UK National Insurance contributions if you’re working temporarily in Switzerland for up to 2 years. This means you will not have to pay social security contributions in Switzerland for the duration of that work.

If you’re going to work temporarily in Switzerland and you’re self-employed, you will need to start paying social security contributions in Switzerland. You should contact the Swiss social security institution for more information.

Iceland

You should apply to HMRC for a certificate or document to continue paying UK National Insurance contributions if you’re employed, a non-UK national, and non-EEA national working temporarily in Iceland for up to 1 year. This can be extended by a further year, but you must receive agreement from the Iceland social security institution before the end of the first year. This means you will not have to pay social security contributions in Iceland for the duration of that work.

Paying social security contributions

If you’re going to work in Iceland or Liechtenstein and you’re not eligible for a certificate or document from HMRC, you may need to continue paying UK National Insurance contributions for the first 52 weeks if you meet the following 3 conditions:

• your employer has a place of business in the UK
• you’re ordinarily resident in the UK
• you were living in the UK immediately before starting work abroad

You may also have to pay contributions in Iceland or Liechtenstein. You should contact the relevant social security institution for more information.

If the conditions above do not apply to you, you will need to pay contributions in Iceland or Lichtenstein. You will not be liable to pay contributions in the UK during this period, but you may be able to pay voluntary contributions.

How to apply for a certificate or document from HMRC

If you think you’re eligible for a certificate or document, you can find the relevant form to complete on a list published on the HMRC website.

If you need to check if a change in your situation prevents the existing social security rules from applying to you, you will need to write to HMRC and explain:

• what your circumstances were
• what has changed
• when the changes happened

More Guidance

The above information is taken from HMRC, and you can find each scenario explained in greater detail on their website.  If you require guidance or have any questions about National Insurance Contributions paid whilst employees are working abroad, please feel free to contact Briars.