Commuters in the Öresund region can work from home without having to worry about a change of social security coverage. Försäkringskassan and Udbetaling Denmark have agreed to make an exception. Work from home due to covid-19 should not change their social security coverage during the ongoing crisis.
Employees within EU/EES who are resident in one country and work in another country are normally covered by the social security system in the country where the work is performed. An employee who normally works in two or several countries within EU/EES should also be covered by the social security in the country of work as long as the employee does not perform an essential part (25 percent or more) of the work in his/her home country. It is therefore important to keep track of where (in which country) the work is performed.
The social security coverage affect the social security fees
Commuters and employers within the Öresund region have been worried about the social security situation for the commuters when the commuters are forced to work from home due to covid-19. When working from home many of them fear that they will exceed the 25 percent threshold. And if an employee's social security coverage changes not only the right to benefit changes but also the employers obligation to pay employer social security fees. For example, a Danish employer with an employee resident in Sweden could be required to register and pay Swedish employer social security fees (Swe: Arbetsgivaravgifter) if an employee’s social security coverage changes. And the Swedish social security fees are much higher than the Danish fees.
The exception rules
On March 20 Öresunddirekt informed on their website that Försäkringskassan and Udbetaling Danmark have agreed that the social security coverage for commuters in the Öresund region should not be affected by the travel restrictions due to covid-19 in the following situations:
For commuters who live in Sweden and normally work in Denmark will the commuter’s social security coverage in Denmark not change due to work from home.
For commuters who live in Denmark and normally work in Sweden will the commuter’s social security coverage in Sweden not change due to work from home.
For commuters who have a valid A1-certificate for work in Sweden and Denmark (multi state worker), i.e. this A1-certificate will still be valid.
Please note that the exceptions do not apply to commuters that due to other reasons than the travel restrictions due to covid-19 have changed their work pattern. A commuter who changes employer or takes up an additional employment/assignment should contact Försäkringskassan or Udbetaling Danmark for information about his/her social security situation. This also applies for commuters who are uncertain about their situation.
When it regards other commuters to other countries within EU/EES Försäkringkassan has not yet made any official statement. However they have, over the phone, verbally confirmed that Försäkringkassan sees this a “state of emergency” and that they will disregard work days from home due to the travel restrictions. We understand that the social security authorities in the other EU/EES countries most likely also will take this position.
No information about the tax situation yet
When it regards the tax situation for the commuters in the Öresund region who normally fulfill the conditions in the Öresund tax agreement there is yet no information from the Swedish or Danish Tax Agencies. A commuter who lives in Sweden and works in Denmark is taxed for the whole salary in Denmark if the commuter performs at least 50 percent of his/her work in Denmark and the remaining part from home or on business trips of occasional character. The same applies to commuters who live in Denmark and work in Sweden, i.e. the whole salary is taxed in Sweden if the conditions are fulfilled. Many commuters are worried about how their tax situation will be affected/changed due to travel restrictions related to covid-19.
We continue to follow the development within this area. You are always welcome to contact us at PwC for assistance when it regards tax and social security questions for commuters.
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Cecilia Arrhenius arbetar på PwC:s skatteavdelning i Malmö sedan mer än tio år tillbaka inom området internationell personbeskattning och socialförsäkring. Cecilia har arbetat i över 25 års med dessa frågor och har gedigen erfarenhet inom dessa områden. Ett av Cecilias speciella fokusområden är skatte- och socialförsäkringsregler i Öresundsregionen.
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