Social security implications due to Brexit

Despite months of negotiations and discussions regarding Brexit, the impact it will have in various aspects remains unclear. The date for withdrawal has been postponed until May 22 subject to a withdrawal agreement being approved, otherwise the deadline is April 12. If the UK will leave the EU with or without an agreement is not yet decided but in case of a hard Brexit and from a social security perspective, the Swedish government has released a legislative proposal intended to make the transition as smooth as possible.

Social security convention between Sweden and the UK

Currently, EU regulation EC 883/04 stipulates the affiliation to a country’s social security system in a cross-border situation between Sweden and the UK. However, there is also a bilateral social security convention, with the same purpose, between Sweden and the UK which entered into force in 1988, before Sweden joined the EU.

Once the UK leaves the EU and EC 883/04 no longer applies, the convention will most likely be used in its stead. If the convention applies, duration of assignments will change from 24 months to 12 months, with a possible extension up to 24 months. Accordingly, an employee going on an assignment for 12 months to Sweden from the UK, or vice versa, should be able to remain in the home country’s social security system with regards to some benefits. The benefits which are regulated according to the convention are sickness benefits, parental benefits, pension and unemployment insurance. Further, in situations where an individual regularly works in both Sweden and the UK he or she will most likely be affiliated to both the Swedish and UK social security system and therefore also be subject to social security contributions in both countries. However, depending on the outcome of Brexit, the applicability and wording of the convention will most likely be evaluated by the authorities in both Sweden and the UK.

Possible impact on Swedish and UK citizens

The Swedish government has released a legislative proposal in case of a hard Brexit to create a secure environment for Swedish citizens living in the UK. The proposal states that individuals, during a transition period, should be able to continue to receive social security benefits from Sweden in the same way as today. The proposal also states that individuals may be able to receive compensation for healthcare costs in some cases. The provisions on the payment of benefits and reimbursement for healthcare expenses will cease at the end of 2019.

For UK citizens living in Sweden, the Swedish government is aiming to make it possible for these citizens to be able to live and work in Sweden with the securities of the social security system.

For those individuals who have been working in the UK and who have been included in the UK social security system, and intends to claim benefits or reimbursements from the Swedish National Insurance Agency (Swedish: Försäkringskassan) after Brexit, it is recommended to request a statement of the individual’s UK National Insurance as this may be required to be able to get reimbursement/benefits in Sweden.

Given the uncertainty about the upcoming Brexit, it is difficult to give any answers to what impact Brexit will have in regard to social security. However, the Swedish government seems to intend to make the impact of Brexit as “gentle” as possible, from a social security perspective, for Swedish and UK citizens in cross-border situations.

You can read more about the implications with regards to Brexit and immigration in our previous article Practical measures for UK citizens in Sweden in case of a no-deal Brexit  

Karolina Engström and Johanna Fridh

 

Contact
Karolina Engström
+46 76 853 23 78

 

Contact
Johanna Fridh
+46 70 250 66 98