As of 6 April 2025, there were significant changes to how companies apply to HM Revenue & Customs (HMRC) to operate Pay As You Earn (PAYE) on the UK income portion for employees not fully liable to UK income tax. The previous Section 690 application was replaced by a more efficient system.
Experts from our UK firm Travers Smith have analysed some of the key updates which included:
The application process is now expedited through an online form available on the Government Gateway, allowing employers to operate PAYE immediately upon confirmation from HMRC.
All existing Section 690 directions became invalid from the 6th of April 2025, necessitating employers to reapply under the new system for the tax year 2025/26.
Notifications for globally mobile employees must now be submitted annually.
The new system adopts a ‘process first, check later’ approach, where employers can estimate the PAYE for internationally mobile employees until HMRC advises otherwise.
Employers have the flexibility to submit further applications if the number of UK workdays for employee changes, ensuring more accurate PAYE deductions.
You can read a more detailed overview here. Additionally, for in-depth information on the new application procedures and the specifics required, please consult the HMRC Guidance.
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