United Kingdom – Updates on Immigration Health Surcharge, Registered Traveller Service

United Kingdom – Updates on Immigration Health

This GMS Flash Alert reports on the health surcharge for emigrating Australia and New Zealand nationals and an expansion of the Registered Traveller Service.

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The U.K. government has recently announced that it was ending its Immigration Health Surcharge exemption for Australian and New Zealand nationals from April 2016.  It also announced that it was extending its current Registered Traveller Service to nationals from Hong Kong, Singapore, South Korea, and Taiwan (Republic of China).

WHY THIS MATTERS

Immigration Health Surcharge (IHS)

The extension of the IHS to Australian and New Zealand nationals could increase the cost to businesses of hiring or seconding nationals from these countries to the United Kingdom.  With the likelihood of minimum salary requirements increasing in April, as well as the introduction of an Immigration Skills Charge later this year, this will be another cost employers will need to consider when moving their highly-skilled workers into the United Kingdom. 

Registered Traveller Service

Many U.K. visa holders and business visitors are required to travel on a regular basis as part of their job.  They can spend a disproportionate amount of their time standing in queues at U.K. airports waiting to be admitted to the United Kingdom.  The new extended scheme will allow more nationals to clear the border/passport control faster meaning less delay, inconvenience, and administrative burden and more time and energy to spend on matters which really require their attention.

Immigration Health Surcharge: Australian, New Zealand National to Pay

The IHS was introduced by the U.K. government last April as a means of ensuring the National Health Service (NHS) remains sustainable and receives a contribution towards the cost of health-care from temporary migrants.  (For prior coverage, see GMS Flash Alert 2015-046, 26 March 2015.) 

Many migrants and their dependants coming to the U.K. for six months or more, or applying for visa extensions in the U.K., have since been required to pay a non-refundable fee of £200 per year of their stay.

Until now, Australian and New Zealand nationals have been exempted from paying the IHS.  Under new rules, this exemption will be lifted from 4 April 2016, making Australian and New Zealand nationals liable to pay the IHS as part of their U.K. visa applications.

European Economic Area (EEA) nationals, those coming to the U.K. for less than six months, visitors, dependants of armed forces personnel, and those making humanitarian applications will continue to be exempt.  Currently, those coming to the U.K. under the Tier 2 (Intra-Company Transfer) visa category are also exempt from paying the IHS (although the U.K. government is considering scrapping this exemption later this year as well1).

KPMG NOTE

The U.K. government feels that it is fair that Australian and New Zealand nationals should contribute to the NHS in the same way as other non-EEA nationals. 

However, the additional cost burden the IHS is potentially going to place on these nationals could further impair the U.K.’s ability to remain competitive in the global market.  Businesses may feel that the constant increase in U.K. visa costs is making it too expensive to do business in the country and thus shift their operations elsewhere, taking their skilled and experienced workforce with them.

Registered Traveller Service Expanded

The Registered Traveller Service was introduced in April 2015 for nationals from Australia, Canada, Japan, New Zealand, and the United States who have a U.K. visa or have visited the U.K. at least four times in the last 24 months.  This Service has allowed nationals from these countries to use ePassport gates and U.K./EEA entry lanes at various ports of entry across the U.K., making their entry into the country typically much faster and smoother.

Now, eligible foreign nationals from Hong Kong, Singapore, South Korea, and Taiwan can also register for the scheme.  The service is currently available at Birmingham, East Midlands, Edinburgh, Gatwick, Glasgow, Heathrow, London City, Luton, Manchester, and Stansted airports, and at the Eurostar terminals at Paris, Brussels, and Lille.  (It is anticipated that Bristol and Cardiff airports may become part of the scheme shortly.)2

KPMG NOTE

Any measures that allow business travellers to enter the U.K. more quickly and easily are welcome.  Many of those using this Service could well be making significant contributions to the success of U.K. businesses as well as the wider U.K. economy.

Registered Traveller Service Applications

Applications for the Registered Traveller Service can be submitted online at https://www.gov.uk/registered-traveller for a fee of £70 for one year.

KPMG NOTE

The U.K. government appears to be taking steps to increase rather than lower the costs of bringing non-EEA migrants to the United Kingdom.  While the government justifies the scrapping of the IHS exemption for Australian and New Zealand nationals by saying it brings them in line with all other non-EEA nationals, for businesses it may feel like just another extra cost imposed on them.  

At least the U.K. government appears to have accepted that it is not good for business in any way to have highly skilled migrants spending too many hours – when they could be working – standing in queues at airports and other ports of entry, and, therefore, they are doing something about it.

FOOTNOTES

1  See the Migration Advisory Committee’s (MAC) “Review of Tier 2: Balancing migrant selectivity, investment in skills and impacts on U.K. productivity and competitiveness.”

2  See “Expansion of The UK Registered Traveller Service” (26 January 2016) on the U.K. Government Web site.

CONTACTS

For additional information or assistance, please contact your usual KPMG GMS or People Services professional* or one of the following professionals with the KPMG International member firm in the United Kingdom:

 

Punam Birly

Tel. +44 (0) 20 7694 4950

Punam.Birly@kpmg.co.uk

 

Paul Jones

Tel. +44 (0) 20 7311 1475

Paul.Jones2@kpmg.co.uk

 

Denise Osterwald

Tel. +44 (0) 20 7694 3481

Denise.Osterwald@kpmg.co.uk

 

* Please note the KPMG International member firm in the United States does not provide immigration services

The information contained in this newsletter was submitted by the KPMG International member firm in the United Kingdom

© 2016 KPMG LLP, a United Kingdom legal liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

Flash Alert is an Global Mobility Services publication of KPMG LLPs Washington National Tax practice. The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.

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