Certificate of Coverage Q&As

When applying for a certificate of coverage in the UK, people often have to seek out guidance to understand what they require, what’s involved in the application process and other considerations, like the period it covers. In this blog, we answer the common questions and explain how certificates can be obtained and key things to consider when applying.

In previous blogs looking at social security for globally mobile employees, we discussed when UK National Insurance is due and the rules for multi-state workers. In these, we covered the rules to determine where contributions should be paid. We also pointed out that a certificate might be necessary to show authorities in other relevant countries that contributions aren’t owed there because they are already being paid elsewhere according to the rules.

Here, we will explain how certificates of coverage can be obtained and key issues around certificates to consider through a series of questions and answers.

CERTIFICATE OF COVERAGE FAQS: YOUR QUESTIONS ANSWERED

Who do you apply to for a certificate of coverage?

The application for a certificate of coverage needs to be made to the authorities of the country where contributions will be paid. When applying for a certificate to remain in the UK National Insurance system, the relevant HMRC office to apply to is the National Insurance Contributions and Employers Office.

Links for the applications with HMRC:

Employer Application – Sending Employees to work abroad

Employee Application – Temporarily posted to EU

Employee Multistate Application – Working in 2 or more countries

Employee Certificate of Continuing Liability – Country with which UK has a Reciprocal Agreement

Self Employed – Temporarily posted to EU

What is the difference between an A1 and Certificate of Continuing Liability?

An A1 is issued when the employee is an EEA national working within the EEA. A Certificate of Continuing Liability is the type of certificate issued when an employee is posted to a country outside the EEA but with which the UK has a social security agreement.

What forms are required to apply for a certificate of coverage?

When applying for a certificate of coverage in the UK, an individual application is required for each employee. The form to use will depend on whether the employee works in one country within the EEA, in more than one country within the EEA (a so-called multi-state worker) or in a country outside the EEA that has an agreement with the UK.

If it is the first time that an employer is sending employees overseas, they will also need to complete an employer application. There are some conditions to be met for an employer to “qualify” which should be considered carefully and the form must be completed accurately.

How long does it take an application to be processed and a certificate issued?

There is no agreed timescale, and it can vary from a few weeks to a number of months, for an application to be processed and a certificate issued. This is why it is best to apply as soon as it is known that the employee will be going overseas. That being said, in most cases, there should not be any consequences for making a retrospective application, so long as the employee qualifies, a certificate should be issued and the start date backdated. However, it should be noted that for certain countries a time limit does apply and this is stated in the agreement, for example for UK postings to Norway the application needs to be made within 4 months of the first date in Norway. Usually, the certificate will simply be posted once the application is processed. However, if HMRC has any questions about the application, someone will get in touch but this will likely delay the process. So all relevant details must be included in the application. If HMRC believes that UK legislation does not apply and contributions are due elsewhere, whoever made the application will be notified.

What period will the certificate cover?

An A1 application can cover a period of up to 24 months and a certificate of coverage application can usually be made for any period of up to 5 years, the agreement between the relevant countries will confirm the period. A certificate should cover the employee from the date they are posted overseas to the expected end of the posting. A further certificate extending the period of coverage may be obtained at a later date if the posting continues for longer than expected. It is important that employers track certificates and their end dates to ensure that if a further certificate is required, this is applied for in good time. Coverage can be extended beyond the 24months and 5 years in some cases.

What if the position changes?

If the employee goes to work in a different country, a new certificate of coverage application is required. If this is within the EU it is important to note and track the initial periods to maintain within the 24 month period.

Summary

As you can see, there are various factors to consider when applying for an A1 or certificate of coverage, so keep these in mind when you need to apply to ensure you take the right steps and get the right certificate for the period and conditions you require. 

If you have any questions regarding social security coverage or require any assistance with obtaining and tracking certificates of coverage, please don’t hesitate to contact us directly. The AAB team are happy to help you with any questions or guidance you need.

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