Moving to the United Kingdom? The Complete 2025/2026 Expat Income Tax Guide

Moving to a new country is exciting — but understanding expat income tax in the United Kingdom is one of the most important steps you can take before (or shortly after) your arrival. The UK tax system has undergone significant changes in recent years, especially for internationally mobile individuals, and the 2025/2026 tax year is no exception.

Whether you're relocating for work, joining a partner, or starting a business, this United Kingdom expat tax guide covers everything you need to know: from residency rules and tax bands to the brand-new Foreign Income and Gains (FIG) regime that replaces the old remittance basis. By the end, you'll have a clear roadmap to manage your moving to United Kingdom taxes obligations with confidence.

How UK Tax Residency Is Determined

Before you can understand what you owe, you need to know whether the UK considers you a tax resident. Unlike many countries that use a simple day-count rule, the United Kingdom applies the Statutory Residence Test (SRT), a structured framework introduced in 2013 that remains in force for 2025/2026.

The Three Parts of the Statutory Residence Test

The SRT works through three sequential tests:

Automatic Overseas Tests — You are automatically non-resident if you meet any of the following:
- You were resident in the UK in none of the previous three tax years and spend fewer than 46 days in the UK.
- You were resident in at least one of the previous three tax years and spend fewer than 16 days in the UK.
- You leave the UK to work full-time overseas and spend fewer than 91 days in the UK (with fewer than 31 working days).
Automatic UK Tests — You are automatically resident if:
- You spend 183 days or more in the UK in the tax year.
- Your only home is in the UK for a period of at least 91 consecutive days (at least 30 of which fall in the tax year).
- You work full-time in the UK for any period of 365 days.
Sufficient Ties Test — If neither automatic test is conclusive, HMRC looks at your UK ties (family, accommodation, work, 90-day presence, and country tie) alongside the number of days you spend in the UK. The more ties you have, the fewer days it takes to become resident.

UK Days in Tax Year	Ties Needed (Not UK Resident in Any of Prior 3 Years)	Ties Needed (UK Resident in Any of Prior 3 Years)
16–45	4 ties	— (automatically non-resident)
46–90	4 ties	2 ties
91–120	3 ties	2 ties
121–182	2 ties	1 tie

Tip for new arrivals: The UK tax year runs from 6 April to 5 April. If you arrive mid-year, you may be able to split the year so that only the UK portion is subject to UK tax — this is called split-year treatment.

UK Income Tax Rates and Allowances for 2025/2026

Once you're resident, you'll be subject to UK income tax on your worldwide income (subject to the new FIG regime discussed below). Here are the 2025/2026 income tax rates for England, Wales, and Northern Ireland:

Tax-Free Personal Allowance

Every UK taxpayer receives a Personal Allowance of £12,570 — the amount you can earn before paying any income tax. This allowance is gradually withdrawn for income above £100,000 (reduced by £1 for every £2 of income above that threshold, fully eliminated at £125,140).

Income Tax Bands 2025/2026

Band	Taxable Income	Rate
Personal Allowance	Up to £12,570	0%
Basic Rate	£12,571 – £50,270	20%
Higher Rate	£50,271 – £125,140	40%
Additional Rate	Over £125,140	45%

Scottish Income Tax Rates

If you live in Scotland, different rates and bands apply. For 2025/2026, Scotland uses six bands:

Band	Taxable Income	Rate
Starter Rate	£12,571 – £15,397	19%
Basic Rate	£15,398 – £27,491	20%
Intermediate Rate	£27,492 – £43,662	21%
Higher Rate	£43,663 – £75,000	42%
Advanced Rate	£75,001 – £125,140	45%
Top Rate	Over £125,140	48%

Practical Example

Suppose you move to London and earn a salary of £65,000 in 2025/2026. Your income tax calculation (England/Wales/NI) would be:

£12,570 at 0% = £0
£37,700 (£12,571 to £50,270) at 20% = £7,540
£14,730 (£50,271 to £65,000) at 40% = £5,892
Total income tax = £13,432

Want a quick, personalised estimate? Use our United Kingdom Income Tax Calculator to see exactly what you'll owe based on your salary, tax code, and residency status.

The New Foreign Income and Gains (FIG) Regime for Expats

One of the biggest changes affecting expat income tax in the United Kingdom is the abolition of the longstanding remittance basis of taxation and its replacement with a new four-year Foreign Income and Gains (FIG) regime, effective from 6 April 2025.

What Changed?

Historically, UK-resident but non-UK-domiciled individuals ("non-doms") could choose the remittance basis, meaning they only paid UK tax on foreign income and gains if they brought (remitted) them to the UK. This system has been fully scrapped.

How the New FIG Regime Works

Under the new rules:

New arrivals to the UK who have been non-UK resident for the previous 10 consecutive tax years can elect into the FIG regime.
If you qualify, your foreign income and gains are exempt from UK tax for four years from the date you become UK tax resident — regardless of whether you bring the money into the UK.
After the four-year window ends, you are taxed on your worldwide income just like any other UK resident.
You cannot claim the Personal Allowance or the Annual Exempt Amount for capital gains during the years you use FIG relief.

Key Points for Expats

Eligibility is time-limited. You get a maximum of four tax years of relief. If you've already been UK-resident for two years before April 2025, you only get two remaining years under FIG.
Election is annual. You don't have to use FIG every year — you can choose year by year based on what's most beneficial.
UK-source income is always taxed. FIG only exempts foreign income and gains. Your UK salary, UK rental income, and UK bank interest are taxed normally.
Transitional rules apply for those who were previously using the remittance basis. There are specific provisions for remitting previously unremitted income at favourable rates through the Temporary Repatriation Facility (TRF) running from 2025 to 2028.

Common misconception: Some expats believe that simply being a foreign national makes them eligible for FIG. This is not correct — eligibility depends on your residence history, not your nationality or domicile.

National Insurance Contributions (NICs) — The Other Payroll Tax

Income tax isn't the only deduction from your payslip. As an employee in the UK, you'll also pay National Insurance Contributions, which fund the state pension, NHS, and certain benefits.

2025/2026 Employee NIC Rates

Class 1 NICs (employees): 8% on earnings between £12,570 and £50,270, plus 2% on earnings above £50,270.
Employer NICs: 15% on earnings above £5,000 (a cost borne by your employer, not deducted from your pay).

If you're self-employed, you'll pay Class 4 NICs at 6% on profits between £12,570 and £50,270, and 2% above that, plus a flat-rate Class 2 contribution.

Social Security Agreements for Expats

If you're moving from a country that has a social security agreement (totalisation agreement) with the UK, you may be able to:

Continue paying into your home country's social security system for a temporary period (usually up to 2 years on a certificate of coverage / A1 form).
Count your UK NIC contributions toward your home country pension, and vice versa.

The UK has social security agreements with most EU/EEA countries (under the UK-EU Trade and Cooperation Agreement), the USA, Canada, Australia, Japan, South Korea, and many others. Check whether your home country has an agreement — it could save you from paying double social security.

Double Taxation Treaties and Foreign Tax Credits

One of the biggest concerns for expats is being taxed twice on the same income — once in the UK and once in your home country. The UK has one of the world's largest networks of Double Taxation Agreements (DTAs), with treaties covering over 130 countries.

How DTAs Help Expats

DTAs typically address:

Employment income: Usually taxed only in the country where you perform the work, with exceptions for short-term assignments.
Pensions: Rules vary by treaty — some allow taxation only in the country of residence; others allow the source country to tax as well.
Dividends, interest, and royalties: DTAs often reduce or eliminate withholding taxes on these payments.
Capital gains: Most treaties give taxing rights to the country of residence, with exceptions for real estate.

Claiming Foreign Tax Credit Relief

If you've paid tax on the same income in another country, you can usually claim Foreign Tax Credit Relief (FTCR) on your UK Self Assessment tax return to avoid double taxation. The credit is limited to the lower of:

The foreign tax paid, or
The UK tax due on that income.

Example: You receive a pension from Germany of £20,000, on which Germany withholds £2,000 in tax. The UK also taxes this pension at your marginal rate (say 40%), meaning £8,000 in UK tax. You can claim a £2,000 foreign tax credit, reducing your UK liability to £6,000. Your total tax paid is £8,000 (not £10,000).

Filing Your UK Tax Return — Deadlines and Practical Steps

Many expats are accustomed to employer-handled tax withholding and may not realise they need to file a separate tax return. Here's what you need to know.

When Do You Need to File Self Assessment?

You must file a Self Assessment tax return if:

You are self-employed or a partner in a partnership.
You have foreign income to declare (including if claiming FIG relief).
Your total income exceeds £150,000.
You have untaxed income (e.g., rental income, investment income).
You need to claim tax reliefs not given through PAYE.
You receive child benefit and either you or your partner earns over £60,000.

If your only income is a UK salary taxed under PAYE, you generally do not need to file a return.

Key Deadlines for 2025/2026

Deadline	Action
5 October 2026	Register for Self Assessment if it's your first time
31 October 2026	Paper tax return deadline
31 January 2027	Online tax return deadline AND payment of tax due
31 July 2027	Second payment on account (if applicable)

Steps to File

Register with HMRC — Apply for a Unique Taxpayer Reference (UTR) and, if needed, a National Insurance number.
Gather your documents — P60, P45, foreign income statements, bank interest certificates, rental income records.
Complete your return online — Use HMRC's online portal or commercial software.
Declare worldwide income — Unless you've elected FIG, include all income from all countries.
Claim reliefs — Foreign tax credits, pension contributions, charitable donations.
Pay on time — Interest and penalties apply for late filing and late payment.

Before filing, use our United Kingdom Income Tax Calculator to cross-check your expected liability and ensure your calculations are correct.

Common Mistakes Expats Make With UK Taxes

Avoiding these pitfalls can save you money, stress, and potential penalties:

Assuming you're non-resident because you have a home abroad. The Statutory Residence Test is nuanced — having property overseas doesn't automatically make you non-resident.
Failing to report worldwide income. If you're UK resident and not using FIG relief, all global income is taxable. HMRC has extensive information-sharing agreements (CRS) with over 100 countries.
Missing the FIG election deadline. You must make the FIG election on your Self Assessment tax return for the relevant year. Missing the deadline means losing that year's relief permanently.
Forgetting about the remittance of old foreign income. If you previously used the remittance basis, bringing old unremitted funds into the UK may trigger a tax charge. Explore the Temporary Repatriation Facility for reduced rates.
Ignoring National Insurance implications. Without a certificate of coverage, you could end up paying social security in both countries.
Not claiming split-year treatment. If you arrive or leave the UK partway through a tax year, split-year treatment can significantly reduce your UK tax bill for that year — but it doesn't apply automatically; you must meet specific conditions.
Overlooking the Personal Allowance taper. If you earn between £100,000 and £125,140, your effective marginal rate is 60% due to the withdrawal of the Personal Allowance. Smart pension contributions can help mitigate this.

Frequently Asked Questions

Do I pay UK tax on my overseas savings and investments?

If you are UK tax resident and have not elected into the FIG regime, yes — interest from foreign bank accounts, overseas dividends, and foreign capital gains are all subject to UK tax. You'll need to report them on your Self Assessment return.

Can I get a UK tax refund if I leave mid-year?

Possibly. If you qualify for split-year treatment, only your UK-period income is taxed. If too much tax has been collected through PAYE, you may be entitled to a refund after filing your return.

What happens to my home-country pension contributions?

This depends on the specific DTA and your home country's rules. In many cases, contributions to overseas pension schemes are not tax-deductible in the UK unless the scheme is a "qualifying overseas pension scheme" (QOPS) or has transitional protection. Review this carefully with a cross-border tax adviser.

Is there a wealth tax in the United Kingdom?

No. The UK does not levy a general wealth tax. However, high-value assets can attract Capital Gains Tax (up to 24% on residential property, 20% on other assets for higher-rate taxpayers in 2025/2026), Inheritance Tax (40% above a £325,000 threshold), and Stamp Duty Land Tax on property purchases.

How does the UK tax remote workers?

If you're UK resident and working remotely for an overseas employer, your employment income is generally taxable in the UK. However, the DTA between the UK and your employer's country may affect how the income is treated and whether double taxation relief is available.

Conclusion: Plan Early, Save More

Navigating expat income tax in the United Kingdom for 2025/2026 requires understanding the residency test, the new FIG regime, NIC obligations, and your DTA protections. The key takeaways are:

Determine your residency status using the Statutory Residence Test before making assumptions about your tax liability.
Explore the FIG regime if you've been non-UK resident for the previous 10 years — it could exempt your foreign income for up to four years.
Understand your NIC position and check whether a social security agreement protects you from double contributions.
Claim all available reliefs, including foreign tax credits, split-year treatment, and pension tax relief.
File and pay on time — HMRC penalties for late Self Assessment returns start at £100 and escalate quickly.

Planning your move to the United Kingdom with tax efficiency in mind can make a meaningful financial difference. Start by estimating your UK tax liability with our United Kingdom Income Tax Calculator and consult a qualified tax adviser for personalised guidance.

This article is for informational purposes only and does not constitute tax advice. Tax laws change frequently; consult a qualified tax professional for advice specific to your situation.