The United Kingdom left the European Union (EU), February 1st, 2020. What will the Brexit mean for British expats in the Netherlands and Dutch employees working and living in the United Kingdom?
Brexit – Residence Permit
In The Netherlands, approximately 20,000 British people work as employees on the Dutch labor market. All British expats in the Netherlands must apply for a regular residence permit per 1 January 2021. This also applies if they already have permanent residence in the EU. The Immigration and Naturalisation Service (IND) will invite expats to submit their application. British expats who visited the Netherlands during the transition period (in 2020) are subject to the same rules as British people who currently are working in the Netherlands. With the residence permit, British workers retain free access to the labor market.
For any employer who is in need to attract new British employees in 2021, it is essential to apply for a work permit via the UWV. This is only possible if recruitment efforts within the Netherlands, EU, Norway, Iceland, Liechtenstein and Switzerland have been unsuccessful. Only then, it is required to start the search and selection of a candidate in the United Kingdom.
A British citizen who would like to settle in the Netherlands for an indefinite period, must apply for a residence permit, indicating the permit is for a “third country national”.
Seconded and Frontier Worker
Furthermore, British people who are now cross-border workers in the Netherlands may continue their employment. Frontier workers are employees who do not live in the Netherlands, but who work here. Whether the British can still start as a frontier worker after the transition period depends on the agreements to be made between the EU and the UK.
Dutch Workers in the UK
Dutch employees who have lived in the UK for 5 (five) consecutive years before the end of the transition period 31 December 2020, have to apply for a settled status. Employees from the Netherlands who have lived in the UK for less than 5 (five) years are entitled to a pre-settled status. They can continue to live and work there until they live there for a total of 5 (five) years and then can still apply for a settled status. The deadline for both applications is June 30, 2021.
Qualifying Foreign Tax Liability
For British expats, for example, the so-called “qualifying foreign tax liability” applies until the end of the transition period. This allows them to, among other things, deduct mortgage interest for their own home in The Netherlands. Whether this benefit will continue after 31 December 2020 depends on the arrangements between the EU and the UK.
The agreements between the EU and the UK also determine the future right to social security of Dutch workers in the UK. If the current schemes do not continue to apply, it is required to take out separate insurance policies for Dutch employees in the UK. The Brexit might lead to extra costs and administration.