Settled status post-Brexit: what you need to know

The government has published a toolkit for employers of EU nationals who want to apply to stay in the UK post Brexit. Here’s what you need to know currently.

The government has now published proposals to support the 3.5m EU nationals and their families who are living in the UK. They will be able to apply for settled status which is equivalent to permanent residency. This will give them the right to live, work and study in the UK. In addition, they’ll be able to access state benefits such as pensions and use public services such as the NHS. Settled status also provides a route into British citizenship.

Eligibility

To be eligible, EU nationals and their families need to have arrived in the UK before 30 December 2020 and have lived here continuously for five years. ‘Continuously’ is defined as having lived here for six months in each of these five years unless there is an exceptional reason such as military service, work or study. If the individual doesn’t have five years’ residency on 30 December 2020 they can apply for pre-settled status which effectively registers them, so they can apply for settled status once have achieved five years. Even those with permanent residence should apply for settled status, but Irish citizens don’t need to apply. Individuals must apply by 30th June 2021. These rules apply to Iceland, Liechtenstein, Norway and Switzerland too which are the EEA countries.

The rules

Each member of the family will need to apply for settled status including spouses of British citizens; any children born in the UK will automatically get British citizenship. The scheme also covers family members who join after 30 December 2020 if the EU citizen that the family member is joining was already resident in the UK, and they had a relationship before this date which continues. Once a person gets settled status, they can be away from the UK for a total of five consecutive years. After this, the status will lapse, so it’s something that needs to be maintained.

The process

The online application system will require the applicant to: Scan a passport or national ID card, provide a corroborating recent photo, provide their NI number, P60, utility bill or bank statement and provide a CRB check. Those who are successful will get an online confirmation not a physical document.

If there is a ‘no deal’ Brexit

In the event of a ‘no deal’ there will be no transition period, so if you’re a UK resident by 29th March 2019 you can apply for settled status by 31st December 2020. There will be no extended application period to 30th June 2021. Until 31st December 2020, a passport from an individual’s home country or national ID card from the EU provides right to work evidence but will only be accepted for up to 3 months. For lengthier stays of between 3 and 36 months, EEA nationals would be required to apply for temporary, non-extendable permission for European Temporary Leave to Remain. It has not been confirmed at this stage whether there is a charge for this.

New immigration system: 1st January 2021

There will be uncapped access for highly skilled and skilled workers from all countries where an employer sponsors a role; the plan being that visas will be issued within 3 weeks. It is possible that the government may introduce a £30,000 salary floor for these sponsored roles. For unskilled labour, 12-month visas will be introduced for certain countries but they will have no access to benefits or the right to bring in dependents.

Employer actions and advice

  • If you’re planning to send EU nationals on overseas secondments make sure you take in account the future five-year rule to avoid their settled status lapsing.
  • Employers will still be required to complete right to work checks with all recruits until the end of 2020; settled status doesn’t change that. The government has committed that will be no change to the rights of EU citizens until 2021.
  • You can support an employee’s settled status application with a signed and dated letter that proves their employment and therefore residency. You’re not obliged to cascade the information or translate it; the government will provide the content in 23 languages in due course.
  • For individuals coming to work in the UK from outside the European Economic Area (the EU plus Iceland, Lichtenstein, Norway and Switzerland) who need a Visa, HMRC have recently confirmed their approach to the employer payment of visa fees (which also applies to employers who had paid the settled status fee before it was abolished in January).
    • Employers can pay for the initial visa without it being a benefit-in-kind, this includes the NHS surcharge. Once an employee is based here any visa extension/NHS surcharge is a benefit in kind as it puts the employee ‘in the position to carry out their duties’.
    • Where a payment is made directly to the authorities for the Visa it should be reported in Section B of P11D for tax and subject to Class 1 NI through payroll at the point of payment.
    • If an employer wants to reimburse the employee, the amount needs grossing up for tax and NI through the payroll.
    • The alternative is to include the amount in a PAYE settlement agreement (PSA).