Teleworking across borders: apply for your A1 document in time!

Working from home has become an integral part of our business landscape. But what if your employee lives abroad and works from there too? To deal with this situation, the so-called Framework Agreement was adopted with effect from 1 July 2023. This allows employees living in one EU member state and working in another to work a maximum of 50% of their time in their state of residence without the social security system of the state of residence becoming applicable. However, this only applies if both member states concerned have signed the agreement. Not all member states have immediately signed the Framework Agreement. 

It is important to stress that the application of the Framework Agreement is optional. When you invoke this agreement, you should apply for an A1 declaration in the country where the employer is established. After all, that country remains responsible for social security. 

Transitional period 

The Framework Agreement provides for a one-year transitional period during which applications can be submitted retroactively. This retroactivity is limited to the start date of the Framework Agreement (1 July 2023, or later for countries that signed the agreement later). This transitional period ends on 30 June 2024. After this date, retroactivity is only possible for a period of three months. A key requirement is that the employee is already subject to the social security of the country where the employer is located. 

Fiscal impact 

The Framework Agreement is limited to rules on social security only. Separate rules apply to the taxability of employees. In many cases, teleworking will result in a tax salary split. 

Key takeaways 

With the approaching deadline of 1 July 2024, we advise employers to check whether any retrospective applications for the Framework Agreement are required. If so, applications should be submitted by 30 June 2024. 

Be sure to take another look at your telework policy. By doing so, you will avoid surprises in case of future changes in the employment situation. 

Would you like to know more about the Framework Agreement, A1 applications, or (international) social security in general? Our specialists are at your service!