HMRC offers a reporting exception for some globally mobile employees

In November 2026, HM Revenue & Customs updated its October employer bulletin to explain an optional reporting exception for eligible globally mobile employees. Phase one of mandatory payrolling begins on 6 April 2027 and covers employer-provided medical benefits and specified company car, van and fuel benefits. HMRC says the exception is intended for genuine practical difficulties in calculating or reporting benefits in real time.

Identify the problem before requesting the exception

The starting point is a list of the benefits an employer actually provides and the information needed to value each one for payroll. In a multinational group, the UK payroll team may depend on a foreign employing entity for the start date of cover, on an insurer for a revised premium or on an adviser for the treatment of a mobile employee. An employer needs to determine which of those gaps it can close before April and which cases may qualify for the exception.

A useful trial is to run a sample through one payroll cycle. Include an employee arriving mid-month, someone whose family cover changes and an employee whose benefit is purchased outside the UK. Record which inputs were available at cut-off, when later information arrived and whether it would have changed the reported amount. The examples are operational tests; they are not tests of legal eligibility by themselves.

Run two reporting paths without duplicating or losing cases

HMRC says employers will notify it of eligible employees through an online G-Form, expected from November 2026. For excepted employees, employers should leave the relevant benefits out of mandatory payrolling and continue the existing year-end P11D and P11D(b) process. Employers should check the current application guidance and keep evidence of what was submitted. The bulletin indicated that further guidance would follow.

The challenge is to build a handoff between the two routes. A case recorded as excepted in a mobility file should be visible to whoever prepares payroll and whoever owns year-end reporting. Those owners need a reconciliation that identifies benefits reported in both places or in neither. Assign one person to review changes of status, including departures and changes in assignment, rather than assuming the classification made at the start of the year will remain appropriate.

Plan for employee questions and vendor cut-offs

The same employer may have colleagues with similar insurance cover whose benefits appear in different reporting processes. The employee communication should explain who to contact about a payslip or year-end form and avoid making promises about personal tax outcomes. If a company operates tax equalisation, the responsible team should check whether the change in timing affects its own calculations or communications.

For employer-paid medical benefits, it is worth asking insurers and brokers whether they can supply consistent effective dates and value data at the right frequency. Contractual delivery dates matter as much as file format. Finance should also consider HMRC’s separate update on real-time Class 1A National Insurance reporting for benefits voluntarily payrolled from April 2027, and review how that change interacts with existing processes.

The exception gives employers a practical option for difficult cases. It should also reveal recurring data problems that would otherwise show up at the payroll cut-off. By keeping an evidence trail and reconciling the two reporting routes, a benefits team can make the distinction between a temporary reporting exception and a structural weakness visible to payroll leadership.

The costs of running two routes should be visible. A payroll team may spend less time correcting a difficult case at month end, while the year-end team takes on more reconciliation. Estimate both before deciding how to staff the transition. If missing valuations affect many cases, ask whether the insurer can change its data delivery schedule or provide a reliable allocation method that payroll and tax can review.

Sources

HM Revenue & Customs | HMRC creates an exception route for globally mobile employees under real-time benefits payroll