PootleK

If you don't have a home in the USA, why would you pay state tax? Couldn't you remotely "relocate" in the USA to a state like Nevada without state income tax?

Pulaski

I think you mean "per year".
If you emigrate (leave the US) from a US state that charges state income tax on emigrants, then you are usually stuck with that link and the obligation to pay state income tax to that state. Certainly it isn't easy to just "relocate" to another state for tax purposes when you are already living outside the US and trying to do so could leave you open to a charge of tax evasion by the state that you attempted to sever a connection to. Good tax planning would include relocation to a zero income tax state, such as Texas, before you leave the US, and that would include renting a home, registering your vehicles, registering with a doctor, etc. i.e. all the things you would do if you were genuinely relocating, which is exactly what you are trying to evidence.

carcajou

Your salary would be exempt from US taxation under the Foreign Earned Income Exclusion. Something like the first $100,000-plus of foreign earned income is exempt if your tax home has been outside the US for roughly 11 months of the year.

That will obviously get blown if you spend your whole summer holiday in the US and don't limit your time to the 35 days or less.

$5,000 per month is on the high end for that kind of position in Saudi Arabia but is not competitive with similar positions at reputable universities in the US.

Yes you would need some kind of medical cover on returning to the US unless you wanted to throw the dice.

Legend_no7

I know we have said above that British expats will not pay tax on income earned in Saudi. However, are there any conditions to this? What if I spend all my holidays in the UK and occasional long weekends during the year (don’t want to accidentally get a huge tax bill)

thanks

fth

OK - perhaps I can help here. I’m in the position of having a few different nationalities, and unfortunately from a tax perspective the USA is one of them.

Bad News
- The USA, alongside Eritrea is one of very few countries that tax you regardless of your residence status. You have to file
- Some states within the USA also make it very difficult for you to break residency and will try and tax you as well
- Avoid without proper research, investing into any mutual fund, collective investment scheme or anything outside the USA (individual shares and interest accounts are less hassle)
- You have to separately report your non- US financial accounts (Google FBAR)

Not so bad News
- You may be able to claim a foreign earned income exclusion, this means that your first $105,000 earned per annum is not taxed. You still have to file. in addition you can’t exclude “passive income” eg investment earnings
- In addition you may be able to partially exclude accomodation costs in Saudi

You are best to get a decent accountant on the case. I have no idea what is there in Saudi, but often the US embassy will provide a list. Because the Saudis are not taxing you, you could probably do with a well versed accountant stateside. Expats typically report filing costs in the order of $1,000-$2,000 per annum.

The utter crappiness of the US tax system for Americans Overseas gets more stupid the more you look at it. Getting rid of the US passport may be an attractive option if you don’t want to live there.

FOR MOST OTHER NATIONALS they will talk about breaking their tax residency. This varies from country to country. Sometimes people who fly-in-fly-out get caught by their home countries too.