Retrospective Correction of Contributions and Payroll After an Incorrectly Assessed A1 Form
Retrospective Correction of Contributions and Payroll After an Incorrectly Assessed A1 Form
An incorrectly assessed A1 form can lead to the wrong determination of the country of social and health insurance coverage. This was also the case for our client, who contacted us after an internal finding that an employee had been assessed incorrectly for contribution purposes for approximately three years. It turned out that social and health insurance contributions should have been paid in a different country than the one in which they had actually been paid.
What risks does an incorrectly assessed A1 form pose?
The situation represented a significant compliance risk for the client, particularly due to:
Administrative inaccuracies in historical records.
Potential financial impact for the employer.
Additional obligations towards the relevant institutions.
Risk of penalties in the event of an inspection.
How we approached the problem
We covered the full process from the initial review of documentation to retrospective registrations, recalculation of contributions and communication with the relevant institutions.
We requested complete documentation
At the beginning, we obtained payroll and employment-law documentation from the client, including the A1 form, historical registrations, and documentation related to contribution obligations.
We analysed the validity period of the A1 form
We reviewed the period to which the A1 form applied, the employee’s legislative affiliation, and how contributions had actually been set up during the relevant period.
We compared the historical setup with legislative requirements
We checked whether the registrations, contributions, and records corresponded to the country in which they should have been correctly maintained according to the A1 form.
We arranged retrospective registrations and communication with institutions
After confirming the discrepancy, we handled the necessary retrospective registrations of the employer and employee and coordinated communication with the relevant institutions.
We prepared a retrospective recalculation of contributions
We calculated the correct social and health insurance contributions for the affected period and prepared the supporting documents needed to align the payroll administration.
We also identified another issue in health insurance
During the review, we uncovered an additional discrepancy that the client had not originally recorded and included it in the corrective steps.
What we secured for the client
Retrospective registration of the employer and employee.
Correct retrospective recalculation of social and health insurance contributions for the entire period.
Alignment of records with applicable legislation.
Minimisation of the risk of penalties.
Greater assurance for the client that the payroll agenda is correctly set up for the future as well.
The greatest added value was the ability to comprehensively cover the entire process – from the initial analysis to the final alignment of all records and communication with institutions.
Client FEEDBACKPayroll advisory in international employment
This case confirms how important it is to correctly assess A1 forms and regularly review payroll settings for employees working in an international context. Even a seemingly administrative inaccuracy can have a significant impact on contributions, registrations, and employer compliance.
If you would also like to gain a reliable partner for payroll processing, you can contact us via the registration form.