New EU Residency Rules for Expats from July 2021
ProACT Sam reviews the new EU Residency rules applied expats Living and Working Abroad in any EU country.
In 2019 the EU introduced a new regulation for member states to upgrade the requirements for an EU Residency permits.
This impacts 3rd country expats including UK citizens from 1st July 2021 and citizens of member states who migrate for working within the EU.
There is also a long term impact for holiday homes and travel into the EU.
These new rules came into force during July 2021 and take effect from the start of August this year.
The timing tailors with the end of the Brexit tranistion and grace periods in June 2021.
RESIDENCY PERMITS
Generally EU countries all use an ID system which includes an ID card. As part of the 4 EU freedoms this allows for freedom of movement across state borders within the EU without passports: the freedoms to move trade, services, capital and people. So any EU citizen can live in another state crossing the borders without a passport.
This is for living, more on working and tax residency later in this article.
BIOMETRIC ID
The new requirements for EU residency permits requires them to include at least 2 types of Biometric data. 100 years ago passports were introduced for international travel. Biometirc data has been captured by governments since the 90s and we currently have vaccination certificates being added to cross border requirements under international rules.
EU residency permits now require a minimum of 2 biometrics data added (facial and 2 fingerprints) to move between countries. Some countries may add more.
For expats this information will be required connected to their residency permits, plus any permanent residency documents and the residency documents of any family members who are from a non EU 3rd country.
Any expat with an EU residency permit is allowed to add family members to their EU residency; family members legally tied by civil arrangements marriage, birth or adoption.
Any expat Living and Working Abroad in the EU who has a pre 2019 EU residency permit will be required to upgrade or renew their permits to include biometric data at some point including:
Using an EU residency permit to cross border in the EU without passport.
Upgrading to a permanent residency or adding family members
Applying for a tax, social insurance or property purchase.
You could voluntarily apply to upgrade your residency permit now at an additional expense.
ProACT Know How and can guide and assist you in the process. Contact us for help.
SCHENGEN SHENANIGANS
To confuse matters further we need to think about the Schengen zone.
This is supposed to be an EU free movement area where passports are not required to cross state borders within the EU.
Except it does not include all EU countries. Ireland, Romania and Cyprus are not members of the Schengen zone so all expats and travellers in and out of these 3 EU countries still need to use passports.
But then Schengen does include EEA countries, Norway, Iceland and Switzerland. These European economic area countries are part of a wider trade zone with the EU but not an EU member as such.
The new EU permit rules apply to these countries so an updated and valid EU residency permit allows cross border travel to these 3 countries also.
Any non EU 3rd country national is subject to full international passport and visa requirements when travelling into any EU member state, subject to that individual countries immigration and visa rules ie varies country by country how you can live or work there.
From January 2021 this includes UK travellers. UNLESS….
If the UK expat has a valid EU residency permit issued for residency taken up before December 2020, then that person and their family retains full rights as an ‘EU citizen’ for a lifetime under the ‘UK Withdrawal Treaty’.
UK Expats could still update their EU residency status to permanent or to add family members as ‘EU citizens’.
If the residency paper work has not been started yet by a UK expat in the EU or an EU expat in the UK, they could still apply for a residency permit under the Withdrawal Treaty, but they must prove residency before December 2020 and the decision is at each countries discretion.
Then there is more, travel days in the Schengen area are further complicated by a restriction applicable to Schengen area countries only.
Plus additional travel authorities are to be required in thenEU from 2022
ProACT Know How and can guide and assist you if you are stuck in any way with your EU residency permit.
RESIDENCY AND TAX
Under international law people can travel for short business and holiday trips up to 90 days without any residency permits or tax liability.
There is still a need for passports and possibly an entry visa.
So UK citizens don’t need any EU residency permits for short business trips within the EU or anywhere else in the world.
The same is true if you own a holiday home. You could visit and stay in your overseas property for 90 days, 3 months without any EU residency permit complication.
If you are Living and Working Abroad for more than 180 days in any year then you become liable to tax in that country of residence. Any long stay expat relocating to any state within or outside the EU will require a tax number for work , business, property rental and worldwide income.
This could include social / national insurance if economic work is being carried out in that country.
This is tax residency legal requirements.
Any expat working as a nomad, or on short business trips can avoid tax registration in the EU country.
Schengen plays a role here. The Schengen zone rules add a complication for short term business trips.
Any person can only travel and remain in a Schengen zone country for 90 days in any 6 month 180 period without a EU residency permit for that country. This is to enforce clear rules on tax residency for individuals.
For non Schengen counties international rules apply. So as long as the 180 day period a year is not exceeded the holiday and work travel into non Schengen counties like Romania, Cyprus, Ireland as well as the UK can be at any time within that year.
ProACT Know How and can guide and assist with any tax residency questions, contact us.
TRAVEL FREEDOMS
UK citizens have 154 visa free travel destinations worldwide including those in the EU.
Passports are required for those cross border trips.
Visas may be required country by country for short work or business trips or longer holiday stays.
In 2021 vaccine and health verifications are required certainly in the short term, and maybe longer, to cross borders.
The USA also require any visitor for any period to have an ESTA. This electronic travel authority must be applied for and approved before travel to the USA and you won’t be allowed in without it. Or even board.
These are not visas, but an additional requirement to passports. Much as additional vaccine verifications are currently required.
In 2022 the EU will introduce its own version of ESTA for travellers into any EU state from any location, with a passport or biometric EU resident permit as appropriate to the traveller.
International travel allows 90 day trips for family or business reasons without residency permits or tax registration.
Schengen zone rules limit travellers, nomads, business trips and longer holiday stays to 90 day stay in 180 days. More frequent stays or trips require an EU residency permit for that state.
This does not apply to countries outside the Schengen zone including UK and Cyprus.
Stays more than 180 days in any year always require a tax residency. When Living and Working Abroad in one country for more that 180 days in a year or carrying out economic activity long term tax registration is required. This could included worldwide income.
ProACT Tax Saving Expat Experts have the knowledge experience and expertise to guide you through the maze of rules form tax residency and EU residency permits and work visas and property permits.
Contact us for a free review with an advisor of your questions or alternatively book a consultation with an expat expert for detailed information.
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