dunroving

Oooh, ta.

nun

You should keep the good folks at SSA up to date with any changes of address. That goes for other organizations too like the IRS

http://www.irs.gov/pub/irs-pdf/f8822.pdf

and banks, insurance companies, brokers etc.....

I don't have any UK tax liability, but I do pay voluntary NI so I always let the HMRC office in Longbenton know if I move.

nun

FYI folks, here is a nice summary of investing problems and potential solutions of US citizens living in the UK.

http://thunfinancial.com/American-Ex...tment-Trap.php

Hotscot

Thanks Nun

It'll be five or so years before we return.
Already I'm slowly formulating the approach of ,

1. Maximize anything I can get into my Roth
2. Transfer any 401k's into Trad IRA and then completely into Roth. (After paying tax)
3. Keep other assets in Vanguard ETF's
4. Keep assets predominantly in US
5. Have SS paid into US bank account.
6. Transfer money when needed, to the UK
7. Eventually decide where to retire and review citizenship.


(When I go to buy a house in the UK and transfer several hundred thousand over for the purchase I know I'll have to declare it but there won't be any sort of tax on it will there?)

nun

Be careful about just converting all IRAs into a ROTH. You need to consider your income level and tax rate in the year or years you make the conversations and your potential future tax rate. Also try to pay any tax with money outside of the IRA so the full amount ends up in the ROTH.

There is no tax on transferring money from US to the UK.

tribec

To the OP , don't give up your citizenship without first investigating the implications of doing so, especially if you move abroad. In SOME cases, the IRS has judged this action particularly severely.

nun

As long as you correctly file the 8854 and are up to date with your US tax obligations there should be no IRS issues after you renounce US citizenship. Most US citizens resident in the UK don't think about renouncing US citizenship to avoid paying US taxes becuase they generally pay no US taxes. It's usually so they can reduce the complexity of tax filing and be sure they are compliant with both UK and US law. They renounce so that they have a chance of complying with IRS regulations without paying a tax expert every year---particulary if they have US assets like IRAs.

J.JsOH

This is the reason I would consider renouncing (see Bolded above). I'm worried about making a blunder on some filing technicality and ending up in hot water through error.

The US influence on filing keeps extending; I just came across another UK company wanting declaration of US persons if I were to make a savings deposit with them. Not that I have anything to hide but it is yet another paper trail to maintain.

nun

Citizenship renunciation is a serious thing and all the legal, financial and emotional issues must be considered. However, it is only an issue for the IRS when it also involves active tax avoidance. If you are up to date with your US taxes, earned less than around $145k average income for the last 5 years and have a net worth less than $2M there are no significant tax issues with giving up US citizenship, but you must still comply with any US tax you owe as a non-resident alien. If you can't meet all of the criteria above you'll have to pay an exit tax to the IRS.