The article examines interpretations of freedom of movement and access to social assistance within the EU Directive 2004/38. Examples of EU migrants’ homelessness are shown to demonstrate the confusing circularity in the regulations. The paper goes on to the development of local governments’ and voluntary organizations’ practice of limiting support to EU migrants in homelessness. Narrower interpretations of the right to reside are a basis for refusing access to benefits or even shelter. Repressive public space practices lead sometimes even to deportations. These interpretations, practices and public discourse are shown on the examples of the Netherlands, the UK and Sweden. Interpretations of the European law, practices and public debate are tools that limit exercising the right to free movement by socially defining and categorising homeless EU migrants as persons whose rights are dependent on their position on the labour market.