A detached worker is an employee sent by an employer in one country to work temporarily in another country for the same employer or for an affiliate of that employer.

Under the agreement, a detached worker remains subject only to the social security taxation and coverage laws of the country from which the employer transferred him or her. However, the worker must meet all the following conditions:

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  The employer/worker expects the period of work in the host country to last no more than 5 years. The 5-year period begins with the date the work in the host country begins or October 1, 2018 (effective date of the agreement) whichever is later;

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  The employment relationship existed before the employer transferred the worker from the home country; and

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  If an American employer sends an employee to the company's affiliate in Brazil, the American employer must enter into an agreement with the Internal Revenue Service (IRS) under section 3121(l) of the IRS Code. The 3121(l) agreement provides, among other things, for Social Security coverage for U.S. citizens and residents employed by the affiliate. In such cases, the employer must still obtain a certificate of coverage to establish the exemption from Brazilian social security taxes.

For more information on coverage agreements under Section 3121(l) of the Internal Revenue Code, refer to RS 01901.070.