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How Will A Benefits Emergency Brake Hit UK Expats?

David Cameron’s emergency break deal to stop migrants to the UK receiving benefits for up to four years could stop returning expats claiming off the state as well.

Although the details of the deal have yet to be thrashed by heads of government, European Commission president Donald Tusk has already given the thumbs up in principle.

In a letter to Cameron he agreed that an outright ban was not suitable, but that Britain could provide an ‘emergency brake’ on paying state benefits to migrants from other European Union states for up to four years.

The brake comes with a proviso – Cameron has to win the European Referendum scheduled for June.

Tusk says in his letter that the EU cannot go against the founding principles of freedom of movement but does have the power to allow Britain to stop paying benefits to incomers for up to four years if the money paid is seen as a financial strain on public services.

Residency is the real issue

This could leave UK expats across Europe in a tricky position.

  • If they are still classed as UK resident, then they have no problem, because living overseas for a short time does not exclude them from free healthcare under the NHS or claiming state benefits.
  • If they are classed as tax resident in another EU state, then the deal is likely to mean they have the same migrant status as any other European citizen.

The issue is not whether they are British by birth, but where they are resident.

The first is a matter of domicile, while the second is a matter of choice over where someone makes their main home.

Expats need to read the small print of the deal carefully to see how they are affected.

Brexit Referendum in June

The details will be fleshed out at a summit between the EU heads of state by the end of February to put Cameron on track to hold his referendum in June – the most likely date is June 23.

The benefits at risk are in-work payments such as tax credits.

Although Cameron and his team claim to have detected a warming to his proposals from other key European nations, he still has the stumbling block of persuading the Eastern European Visegrad group.

The group comprises Hungary, Slovakia, the Czech Republic and Poland – the four countries with higher numbers of migrants coming to the UK who feel the deal is discrimination against their citizens and a breach of their rights under European law.

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