Part 3: Protecting Expat Family & Business Health
ProACT Sam consider how cross border national healthcare is secured for Expat family and business.
Cyprus is introducing a new National Health Service for citizens in Cyprus including Expats Living and Working Abroad.
Brexit also impacts citizen rights including those under the EU Social Insurance Agreement which include state healthcare cross border for EU citizens.
We also highlight 8 actions to Protect Expat Family & Business Health.
6 Impacts of Health Services Changes
This is the third article which covers sections 6 & 7.
What the changes mean in accessing the health services
How Expats qualify for the Cyprus Health Service
How to Register
The Cost to Working Expats and Business
Tax & Treatment Expenses You May Pay
The Impact of Brexit
Protecting Your Family’s Health
The Impact of Brexit
UK & EU Expats get rights as EU citizens to National Health service in the country of tax residency, this includes into the new Cyprus National Health system.
EU Expats in the UK get access to the National Health Service on the same basis as UK citizens, without discrimination.
The rules of entry and the level of treatment and charges into any EU Countrys’ Health System is based upon that country local rules.
Health Care is not always universal nor a free for all service.
New Healthy Tax
Tax residents of Cyprus will qualify for National Health Service, meaning they must be registered with the immigration service, a process that requires Cyprus accommodation and residence for more than 6 months a tax year.
Being an EU Citizen or Resident is not enough.
You must also be tax resident and pay the National Health Insurance as a ‘tax’.
This is not an income tax, it is not a Social Insurance tax.
It is a new tax payable by Expats in Cyprus from 2019 .
Working Expats
Those Working in Cyprus, who have paid social insurance, will now add national insurance tax payments to qualify for the Cyprus National Health Service.
This will continue with or without Brexit for any UK or EU or worldwide Expat Living and Working Abroad in Cyprus.
Expats who are tax resident in Cyprus but work overseas, and do not pay social insurance for work in Cyprus, could qualify for Cyprus National Health Service by paying the National Health Insurance with their annual tax return on worldwide or investment income.
Retired Expats
Retired EU expats who have an S1 form issued by their home country to Cyprus, will continue to be entitled to Cyprus Health Service.
UK expats after Brexit, could as it stands, no longer be entitled to an S1 and will not qualify for UK funded healthcare overseas. This is because the S1 is issued under the EU Social Insurance Agreements.
During transition the S1 remains in force for Expats, meaning they will continue to qualify for Healthcare cross border in the EU and in Cyprus.
The bit in the middle could be messy and is at the heart of the Withdrawal Treaty debate. The Withdrawl Treaty is supposed to allow the UK to leave the EU but keep everything the same during the transition period. This period is still set to December 2020 but could be extended by another 2 years….or longer.
The Withdrawl Treaty maintains the existing rights of UK Expats in the EU, and EU expats in the UK during the transitional period. The objective of the transitional period is to be the time to negotiate new bilateral agreements between the EU and UK. So in theory a new UK-EU social insurance agreement.
The UK and Cyprus post Brexit could sign (independently of the EU) a new bilateral UK - Cyprus social insurance agreement to restore a scheme similar to the S1 again.
By the end of transition. The a new UK-EU trade agreement should then be in place which would certainly cover citizens rights including reciprocal Healthcare arrangements.
Meanwhile the UK and Cyprus have confirmed they will continue to treat Expats in each country in the same way after Brexit, this cannot be said for certain when it comes to paying medical bills.
Tax Resident Expats
Retired Expats and non working Expats could also qualify for Cyprus healthcare through National Health Insurance payments with their tax returns. A number of qualifying years may apply.
If paying national insurance tax through tax returns on other interest, rental or dividend income Expats will qualify for Cyprus Health Cover and this is unaffected by Brexit.
Brexit Summary
Brexit means no change to the qualification rules for UK expats until after any transition period.
Even so Expats have a new National Health Insurance tax to pay to qualify for health care. As long as residency rights are secure and tax is paid then after Brexit access to Cyprus Health Service will be maintained for any Expat as a tax resident in Cyprus, Living, Working or Retired in Cyprus.
8 Actions to Protect Your Expat Family & Business Health
Working Expats Living and Working Abroad in Cyprus and paying National Health Insurance through Social or Tax Returns will gain access to the expanded Cyprus Health System.
1. RESIDENCY REGISTRATION
If you are Working Abroad in Cyprus consider updating your Cyprus residency, tax, social and health registrations.
All Cyprus Tax residents will qualify for Cyprus Health System and to pay National Health Insurance tax.
2. EMPLOYERS PAY REVEIW
All employers will be see their employees qualify for the Cyprus Health System by virtue of the previous social insurance contributions.
National Health Insurance tax starts from march 2019 and increases up to a total of 5.55% of pay for all employers and their employees.
Employers should review contracts with Employees and decide who will pay.
Social Insurance rates rise in 2019 in addition,
3. EMPLOY THE FAMILY
Employers could consider adding ‘family members’ on the payroll, A spouse or minor children up to age 26 are covered under a registered person. This includes EU and Non EU Expats.
Anyone not automatically qualify for Cyprus Health System through family, must qualify through S1 or National Health Insurance tax contributions. This could be employed in the family business.
4. SELF EMPLOYED
National Health Insurance Tax will be added to your 2nd Quarter of 2019 Social Insurance Payment.
Note the spouse of a self employed person usually can’t be an employee in Cyprus.
5. RETIRED EXPATS S1
EU Expats Living Abroad in Cyprus as a retired tax resident need to obtain an S1 from their home country and have this registered before they qualify for Cyprus Health Insurance System, but there is a tax to pay in returns starting at 1.7% in 2019 and rising to 2.65%.
6. TAX TREATMENT
All Cyprus tax residents will need to submit an online tax return from 2019 to include the National Health Insurance Tax due on all income. This is payable at 1.7% in 2019 and 2.65% for 2020 onwards.
This is a flat rate tax with currently in Q2 2019 no exemptions or allowances against income liable to this tax - pension, earned, interest or dividend.
7. IN and OUT OF HOSPITAL
Out Patient treatment starts in June 2019 but other services including In Patient don’t start until 2020.
Many services are included under the Health system but some may require a means tested payment between Euro75-300, any such payment is a maximum per year.
These patient payments range from Euro 1 for a prescription item.
8. PRIVATE COVER
Private Health Care is still an option, for speedy, or more comprehensive cover, and premiums are tax deductible on Cyprus Tax returns.
Anyone not qualifying for Cyprus National Health Insurance may want to pursue this route.
For example an expat Living and Working Abroad in Cyprus for the first time, will need Private Medical cover for up to 3 years, until qualifying for benefits under current rules.
What should you choose for your family ?
ProACT Know How
ProACT Expat Experts are here to help, if you need any help and assistance on how to qualify for and register in the Cyprus Health Service contact us