Health surcharge extended to Australia, New Zealand

IMPACT – MEDIUM

What is the change? The Home Office announced Thursday that the United Kingdom’s Immigration Health Surcharge will be extended to Australian and New Zealand nationals beginning April 6.

What does the change mean? Beginning April 6, Australian and New Zealand nationals applying to stay in the U.K. for more than six months will be subject to the same £200 per year surcharge as other non-EEA nationals. A discounted rate of £150 per year will be applied to those applying to come to the U.K. on student visas or through the Youth Mobility Scheme.

• Implementation time frame: April 6, 2016.
• Visas/permits affected: Tier 1, Work visas under Tier 2 (General) sponsorship, Tier 4 (student) and Tier 5 visas.
• Who is affected: Australian and New Zealand nationals applying to work or study in the U.K. for longer than six months.
• Impact on processing times: The surcharge will not lengthen processing times, but applicants must pay the surcharge before their visa or extension applications will be processed. Any error in the payment could slow processing.
• Business impact: The surcharge will increase the costs for employers sponsoring Australian and New Zealand employees under the Tier 2 (General) route in the U.K.

Background: The U.K. introduced mandatory health surcharges for most non-EEA visa applicants in April of 2015. Australian and New Zealand nationals were granted an exemption that will expire on April 6.

The Home Office says the fees are designed to ensure that the National Health Service “receives a fair contribution to the cost of healthcare from temporary migrants.” To date, the surcharges have contributed more than £100 million to the NHS. Migrants who pay the surcharge generally have access to free health care, but may be charged for some services, including dental care and prescriptions.

EEA nationals do not have to pay the surcharge. Non-EEA nationals who stay in the U.K. for less than six months are not required to pay the surcharge either, but must pay out of pocket for medical services they do receive. Under reciprocal agreements, Australian and New Zealand nationals who stay in the U.K. for less than six months will not be charged if they require health services that must be provided before they can return home.

BAL Analysis: Australian and New Zealand visa applicants should plan for the levies and be sure that the health surcharge is paid at the time of their application and covers their entire length of stay. The U.K.’s recent Migration Advisory Committee (MAC) report recommended an expansion of the Immigration Health Surcharge scheme in 2016, including extending it to intra-company transferees. BAL will report further expansions of the scheme as soon as they are made public.

This alert has been provided by the BAL Global Practice group in the United Kingdom. For additional information, please contact uk@bal.com.

Copyright © 2016 Berry Appleman & Leiden LLP. All rights reserved. Reprinting or digital redistribution to the public is permitted only with the express written permission of Berry Appleman & Leiden LLP. For inquiries please contact copyright@bal.com.