On 7 October 2026, the U.K. Social Security authority (HMRC) published further guidance through two National Insurance Manuals (NIMs) clarifying the transitional rules under the U.K.–India Double Contribution Convention (DCC), which entered into force on 15 July 2026.1,2,3,4
Please see our previous GMS Flash Alert covering the details on the DCC.
The new HMRC guidance provides clarity on how individuals who were already on assignment when the DCC took effect are treated. In particular, it outlines a jointly agreed mechanism between HMRC and the Employees’ Provident Fund Organization (EPFO) in India allowing certain assignees to maintain their pre-agreement position for up to 52 weeks from the start of their temporary posting. However, a formal notification from the EPFO is awaited.
While the above guidance has been issued by HMRC, from an Indian perspective, a formal notification from the EPFO is awaited.
Employers with personnel who were on assignment between the U.K. and India when the DCC took effect on 15 July 2026 should review their population against this new HMRC guidance. Assessing whether employees qualify for the Article 12 transitional exception up to the 52-week mark may be important to support appropriate payroll treatment and avoid inadvertent double contributions or compliance gaps during the changeover.
Many organizations acted swiftly in July 2026 to transition their assignment populations in line with the initial treaty text, only to find that subsequent modification provisions now permit an Article 12 transitional window up to the 52-week mark.
While this flexibility is a welcome relief for assignment continuity, the timing of the guidance means that employers who already changed their assignees' social security liabilities to the host country in July 2026 could now assess whether to unwind those changes. For affected populations, this may involve correcting payroll submissions, seeking refunds of social security contributions already paid in the host country, settling any late contributions in the home country, applying retrospectively for certificates of coverage for U.K. to India assignments, and communicating with the affected employees.
If assignees and/or their programme managers have any questions or concerns about the scope of this guidance, its application and potential impacts, they should consult a member of the GMS team with KPMG in the U.K. or in India (see the Contacts section).
1 GOV.UK website, “Agreement between Great Britain and India,” published on 10 February 2026.
2 GOV.UK website, “Explanatory Memorandum on the Agreement.”
3 GOV.UK website, “NIM33252 - Special Cases: India - Transitional situations - HMRC internal manual - GOV.UK,” updated on 7 October 2026.
4 GOV.UK website, “NIM33262 - Special Cases: India - Exceptions - HMRC internal manual - GOV.UK,” updated on 7 October 2026.
The information contained in this newsletter was submitted by the KPMG International member firms in the United Kingdom and India.
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