by Amy Virk
Private Client Services Director
26 September 2025
Articleby Amy Virk
Private Client Services Director
After 17 years of uncertainty, HMRC has finally clarified how National Insurance Contributions (NIC) should apply to Internationally Mobile Employees (IMEs). This long-awaited guidance brings much-needed clarity to employers and employees alike.
Key Takeaway
NIC must now be applied on an apportionment basis, meaning only earnings relating to UK periods are NIC applicable. This applies to both bonuses and base salary.
Challenges and Considerations
While the clarity is welcome, the practical and retrospective challenges are significant:
Why the Sudden Certainty?
Previously, HMRC accepted both "all or nothing" and apportionment methods. The sudden shift to a clear stance raises questions about the underlying reasons for this change.
Conclusion
In short, while the clarity is welcome, the practical and retrospective challenges are significant. Employers will need to review historic NIC treatment for IMEs and prepare their payroll processes for increased HMRC scrutiny, which could lead to more compliance risks.
If you wish to discuss this article in further detail, please get in touch with our Global Mobility Tax Services team here.