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The £300,000 Overseas Workday Relief cap, and the number that actually binds first

2 Aug 2026

Most write-ups of Overseas Workday Relief lead with the £300,000 figure like it's the number to plan around. It rarely is. The actual rule, from EIM43600, is that relief for a qualifying year is capped at the lower of 30% of your relevant qualifying employment income for that year, or £300,000. Two different ceilings, and for most people claiming OWR, the 30% one is the one that actually bites.

Where the crossover sits

Work out when each figure wins and the answer is a clean threshold: 30% of income equals £300,000 exactly at £1,000,000 of qualifying employment income.

Two examples make this concrete, using the same lower-of-30%-or-£300,000 rule the calculator below applies automatically:

A £600,000 salary, 60% of workdays overseas. Uncapped, 60% of £600,000 is £360,000 of exempt income. But 30% of £600,000 is only £180,000, well under £300,000 — so £180,000 is the actual relief, not £360,000 and nowhere near £300,000.

A £1,200,000 salary, 50% of workdays overseas. Uncapped, that's £600,000 exempt. 30% of £1,200,000 is £360,000, which is now above £300,000 — so here the flat £300,000 figure finally becomes the binding constraint, and that's the relief claimed.

"Relevant qualifying employment income" also isn't your whole salary if part of your role is UK-only: EIM43600 excludes income from employment performed solely in the UK from the calculation, counting only earnings from employment carried out both in and outside the UK.

The trade-off the cap number hides

The part of the manual that gets skipped in most explainers isn't the cap itself, it's what an OWR election costs you regardless of how much relief you actually claim. Per EIM43580, making an OWR election forfeits your personal allowance, blind person's allowance, married couple's and civil partner's tax reductions, the transferable tax allowance, and life insurance premium relief for that tax year — in full, not tapered to match the relief claimed.

For someone with a large overseas fraction on a high salary this is irrelevant next to the relief gained. But for someone with a modest overseas fraction — say 15–20% of workdays — on a salary well under the £100,000 personal allowance taper threshold, giving up a full £12,570 allowance (worth up to £5,028 in tax at the 40% band) can cost more than the OWR relief is worth. It's a genuine "should I elect at all" calculation, not just a "how much can I claim" one, and it's specific to your numbers — FIG Tracker's OWR calculator runs both sides of it (relief gained against allowance lost) rather than just the relief figure.

Where FIG Tracker fits in

The 30%-vs-£300,000 comparison, the exclusion of UK-only employment income, and the personal allowance trade-off are exactly the kind of arithmetic that's easy to get backwards by hand. FIG Tracker applies the same lower-of rule from EIM43600 automatically against your actual workday count, and flags when the personal allowance you'd give up outweighs the relief an election would bring. For the mechanics of how the underlying workday fraction itself gets calculated for RSUs and bonuses specifically, see how OWR is actually calculated.

FIG Tracker is a calculation aid, not tax advice. Always verify your figures with a qualified tax advisor before filing with HMRC.

Frequently asked questions

Is the Overseas Workday Relief cap always £300,000?
No — the cap is the lower of 30% of your relevant qualifying employment income for the year or £300,000 (EIM43600). Because 30% of £1,000,000 is exactly £300,000, the flat £300,000 figure only becomes the binding number once your qualifying employment income reaches around £1 million. Below that, 30% of income is always the smaller, and therefore the real, ceiling.
Does the OWR cap apply per tax year or per qualifying year?
Per qualifying year. If income relating to one qualifying year (say a bonus with a delayed payment date) gets taxed across more than one tax year, all the OWR claims relating to that qualifying year still share the same single limit — HMRC's manual describes this as the limit applying cumulatively across the tax years in which that year's income is charged to tax.
Do I lose my personal allowance if I make an OWR election?
Yes. Making an OWR election forfeits the personal allowance, blind person's allowance, married couple's/civil partner's tax reductions, the transferable tax allowance, and life insurance premium relief for that tax year — regardless of how small the OWR relief actually turns out to be. For someone with a modest overseas fraction, the lost allowance can outweigh the relief gained.