United Kingdom/India: Free Trade Agreement and Social Security Agreement Forthcoming
July 24, 2025
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At a Glance
- The United Kingdom and India have concluded talks on a Free Trade Agreement, and have agreed to negotiate a Double Contributions Convention, a social security agreement which will come into force in line with the wider trade deal.
- The Convention will ensure that employees moving between the United Kingdom and India and their employers will only be liable for social security contributions in one country at a time, avoiding double payments.
- It will also ensure that employees temporarily working in the other country (for up to three years) will only continue paying social security contributions in their home country.
- Update July 24, 2025: The Free Trade Agreement has been signed by both parties and must now be ratified by both countries to be effective, which is anticipated to take around one year.
The situation
The United Kingdom and India have concluded talks on a Free Trade Agreement (FTA), and have agreed to negotiate a Double Contributions Convention (DCC), which will come into force in line with the wider trade deal.
A closer look
- Social security provisions of DCC. The DCC will ensure that:
- Employees moving between India and the United Kingdom and their employers will only be liable for social security contributions in one country at a time, avoiding double payments; and
- Employees temporarily working in the other country (for up to three years) will only continue paying social security contributions in their home country.
- Reciprocal application. This agreement is reciprocal, benefiting both employees (and employers) on assignment from India to the United Kingdom (and vice versa).
Impact
Both businesses and citizens across the United Kingdom and India will benefit from the DCC, as it will prevent employers and employees from being liable for double social security contribution payments, exempting employees on temporary assignment (for up to three years) from making social security contributions in the host country.
However, the DCC will not impact employees’ rights to access social security benefits (such as pensions) from the country where they pay their social security contributions.
Background
Negotiations on this FTA started in January 2022. Considering the historic business relationship between the United Kingdom and India and the projected growth of the Indian economy, these agreements present a significant opportunity for UK and Indian businesses.
Looking ahead
- Only a summary of the FTA has been published. The UK and Indian governments will now work together to finalize the legal text of the FTA.
- The full text of the DCC has not yet been published. Negotiations will start soon, and the intention is that it will enter into force alongside the FTA.
- Update July 24, 2025: The Free Trade Agreement has been signed by both parties and must now be ratified by both countries to be effective, which is anticipated to take around one year.
- Both agreements will be finalized when the UK and Indian governments complete their ratification processes. We will provide updates when this happens.
The Fragomen Social Security team can guide clients to optimise their Social Security programs, assist with avoiding double social security taxation, where possible, and advise on pension and Totalisation Agreements. This alert is for informational purposes only. If you have any questions, please contact the global immigration professional with whom you work at Fragomen or send an email to [email protected].
