The Institute of Chartered Accountants in England and Wales (ICAEW) has reminded employers that, from 6 April 2025, those with globally mobile or treaty non-resident employees may operate reduced PAYE withholding immediately after submitting a notification to HMRC. This replaces the former section 690 pre-approval process.Â
The notification confines PAYE to the UK proportion of earnings, yet workers must still file a self assessment return to reconcile their final liability. All pre-existing determinations lapsed on 5 April 2025, so new notifications are required for 2025/26. HMRC’s online form, launched alongside the changes, allows agents to upload authorisation and must be renewed each tax year.Â
The same legislative package remodels overseas workdays relief (OWR) within the new foreign income and gains (FIG) regime that succeeds the abolished domicile rules. OWR is now available for the first four years of UK tax residence, provided the individual was not UK-resident in any of the preceding ten tax years. Relief is capped at the lower of 30 per cent of qualifying employment income or £300,000 per tax year. Unlike the previous regime, earnings need not be paid or retained offshore unless attributable to periods ending before 5 April 2025.Â
Transitional measures apply for employees who became UK residents in 2023/24 or 2024/25. Employers should refresh mobility policies, payroll instructions and employee communications promptly to secure the available reliefs and prevent unnecessary withholding.Â
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