Very little finances to move back with

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Aug 3rd 2020, 6:39 pm

#16

Pulaski

Joined: Dec 2001

Location: Dixie, ex UK

Posts: 52,439

Re: Very little finances to move back with

Quote:

Originally Posted by durham_lad

Exactly. To clarify further it is like for like. Since SS is only taxed in the U.K. then you can’t use those taxes as credits against taxes paid on other US income. For example. A US government pension is only taxed in the US so you can’t use the taxes you paid in the U.K. on SS against the taxes paid in the US on the government pension.

But it sounds like they're going to have tax credits going in both directions - tax paid in the UK and (perhaps) claimed as a credit in the US (if Goinghome70 is remains subject to US taxes after returnig to the UK i.e. is a US citizen or chooses to remain a PR).

And then tax paid in the US would be claimed as a credit in the UK against taxes charged by HMR&C against Mr Goinghome70 because he will become tax resident in the UK. And as noted, because UK taxes are generally higher than in the US, there may be some additional tax to pay in the UK on income already taxed in the US, and that is where a tax credit for US taxes already paid, would come into play.

Last edited by Pulaski; Aug 3rd 2020 at 6:41 pm.