Where a worker is to be posted to another Member State, an A1 certificate (former E-101 certificate) should be applied for in the Member State where social security is renewed. In the host State, the A1 waives any social security contributions. Each tabling agreement has an exception for international employees. Under this derogation, a person who is temporarily transferred for the same employer to another county remains covered only by the national form sent to him. Workers and employers continue to contribute to the home social security system. Applications must contain the name and address of the employer in the United States and the other country, the worker`s full name, place and date of birth, citizenship, U.S. and foreign social security numbers, place and date of hiring, and the start and end date of the overseas operation. (If the employee works for a foreign subsidiary of the U.S. company, the application should also indicate whether U.S. social security coverage has been agreed for employees of the related business in accordance with Section 3121(l) of the Internal Income Code.) Self-employed persons should indicate their country of residence and the nature of their self-employment.
When applying for certificates under the agreement with France, the employer (or self-employed) must also certify that the worker and all accompanying family members are covered by health insurance. laws and regulations relating to the imposition of liability for the payment of social security contributions; (Note: only students are covered by the agreement with Vietnam). The United States has agreements with several countries, called tabination agreements, to avoid double taxation of income with respect to social security taxes. These agreements should be taken into account when it is established whether a foreigner is subject to U.S. Social Security/Medicare tax or whether a U.S. citizen or resident alien is subject to a foreign country`s social security taxes. The agreements also have positive effects on the profitability and competitive position of companies with foreign activities by reducing their operating costs abroad. Companies that have expatriate staff are encouraged to use these agreements to reduce their tax burden.
As a warning, it should be noted that the derogation is relatively rare and is invoked only in mandatory cases. The intention is not to give workers or employers the freedom to routinely choose coverage contrary to the normal rules of the agreement. The competent authorities and agencies of the Parties shall, within the framework of their respective authorities, support each other in the implementation of this Agreement. This aid shall be free of charge, subject to any derogations to be agreed in an administrative agreement. . . .