United Kingdom · Tax regime
Overseas Workday Relief
Reformed
Last verified July 2026
Reformed from 6 April 2025: extended to 4 tax years and decoupled from domicile and offshore retention, but capped for the first time.
The reform is genuinely better for most people: OWR now runs 4 years instead of 3, applies regardless of domicile, and no longer requires the income to be kept offshore — the old offshore-account choreography and mixed-fund risk are gone. The trade is a hard cap that bites precisely at senior executive pay levels.
The facts
- Total landed cost
- No entry cost; relief is capped at the lower of 30% of qualifying employment income or GBP 300,000 a year
- Physical presence
- Relief tracks actual overseas workdays; contemporaneous day-count and travel records are the evidence base
- Family
- individual employee only
- Permanent residency
- n/a
- Citizenship
- n/a
- Dual citizenship
- Permitted
- Requirements
- qualify for the 4-year FIG regimeemployment duties genuinely performed outside the UKelection made on the tax returnrelief limited to the lower of 30% of qualifying employment income or GBP 300,000 per qualifying year
What can go wrong
- The GBP 300,000 / 30% cap is new and lands hardest on the highest earners — the people for whom the relief was previously most valuable.
- Eligibility is now bolted to the FIG regime, so the 10-year prior non-residence test applies. Anyone who fails FIG fails OWR.
- Transitional protection exists for people already claiming before 6 April 2025 — they can claim to the end of their third tax year, and the cap does not apply to them. That grandfathering is worth confirming before restructuring anything.
- Relief is by election and needs robust workday evidence; HMRC scrutiny of day-counts is well established.