A1 Certificate: The Importance for Employees and Employers

Introduction

No one likes to be charged twice, especially when it comes to taxes and social security contributions! A double burden of social contributions can quickly arise if employees or self-employed individuals have a (work-related) connection to more than one EU country. To avoid double taxation with social security contributions, employees and their employers should familiarize themselves with the topic of the “A1 Certificate” at an early stage.

Application and Issuance of the Certificate

Basics of Application

The A1 Certificate definitively regulates which national social security regulations apply. Employers apply for the certificate for employees who are temporarily working in another EU country. It is important to note that even short business trips abroad within the EU require an A1 Certificate.

Mandatory Electronic Application from 2019

Since 2018, the A1 Certificate can be requested electronically. From 01.07.2019, this procedure is mandatory. All employees and self-employed individuals who usually work in several EU countries must apply for the form at the “German Liaison Office for Health Insurance – Abroad” (DVKA).

Changes in Application from 2020

Since 01.01.2020, there are new requirements for applying for an A1 Certificate. Among other things, proof of the application before starting the employment abroad is required, and specifying the start and end of the posting is mandatory.

Changes in Procedure from 2021

Since 01.01.2021, further changes apply to the A1 Certificate procedure. A printout of the certificate is no longer required; instead, it can be transmitted electronically. The electronic procedure also applies to employees working in multiple countries.

Regulations in the Context of Brexit

After the United Kingdom's exit from the EU, special regulations apply for A1 Certificates, depending on whether they are existing cases or new cases.

Legal Effect of the Certificate

The A1 Certificate is binding and valid until the specified expiry date. It should be kept available if needed to prove the social security status.

Determination of the Applicable Social System

European Community law regulates how the applicable social system for working individuals is determined. The A1 Certificate is required when deviating from this principle. There are various scenarios where the A1 Certificate applies, such as when posting employees, self-employed individuals, or in mixed cases.

By understanding and observing the A1 Certificate, employees and employers can avoid potential risks and ensure that social security contributions are paid correctly. With the ongoing adjustments in the procedure, it is important to always be informed about the current regulations to avoid legal consequences.