nirish83

I'm a UKC and my OH is a USC and we've lived in the US together for about 4 years. We're thinking about moving back to the UK next year. I have my green card and could apply for US citizenship at any time but don't know if it's worth it. If we move I know I will give up my permanent residency in the US but it was so much work getting it a few years ago, it feels a shame to just give it up. But at the same time, I have no particular desire to become a USC. And I know if you're a naturalized citizen you have to travel back to the US at least once a year and pay taxes here the rest of your life!
If we moved to the UK, we wouldn't have intentions of moving back to the US although never say never...!
Is there anyway around not giving up my US residency entirely without becoming a USC?

Mummy in the foothills

You don't have to travel back annually, as a USC, but you are supposed to pay taxes forever. You can do them online.
Is there a slight chance you may want to move back again? If so I'd spend the $475 or whatever it is now and do the citizenship.

Stormer999

Make sure you save all the stamps...............

CPW

You don't have to pay taxes forever. As a US citizen living outside the US you would be expected to file a US tax return annually – it doesn't follow that any tax would be due.

You certainly don't have to travel back to the USA annually as a naturalised US citizen living abroad – or travel back to the USA at all for that matter.

Myself, I'd be applying if I was eligible to. You have a partner who is a US citizen, and who knows what the future may bring? As you yourself say, never say never. Having gone to the trouble of getting a green card for the USA, it seems rather silly not to go the extra step if you can.

Mummy in the foothills

Sorry I mean file annually forever not pay forever (unless you are earning over $87,00 or is it £ annually or whatever it is now) Which does happen to some lucky beggars

charleygirl

$675.00 and I would seriously consider it.

dunroving

Get your US citizenship. Not much to lose and too much to gain (not least of which are "keeping your options open" and "saving a sh*tload of hassle when you eventually change your mind about the US/UK thing").

nirish83

Ok, thanks for all the advice...I guess i'll start looking into pledging my allegiance!
Does anyone know more about the tax threshold though? Don't want to get burned by paying taxes in both countries.

dunroving

I think tax rates are generally higher in the UK than the US, in which case living in the UK you'd pay more taxes than wold be due in the US, and via the tax treaty you would therefore not owe any tax to the US most years.

AmerLisa

Worth reading.....

http://www.taxmeless.com/page4.html

Also....

http://britishexpats.com/wiki/Taxes_..._IRS_in_London

Jerseygirl

Your husband will have to file a US tax return each year...so filing jointly won't make much difference.

Getting US citizenship makes so much sense...it leaves the door open for you to return to the US if you wish.

sallysimmons

Yes, I was told that too. Even though total taxes in the US are often higher - especially at the lower salary ranges - for the purposes of this calculation, you are only comparing Federal tax to UK income tax - no state, city, or self-employment taxes. That means UK taxes will almost always be higher and therefore there's no tax to pay.

Giantaxe

I can see that argument for earned income, but there are other circumstances where tax could be due the US. For example, the UK has a capital gains exclusion of about $16k of gains, whereas the US taxes every $ of gains. So people with capital gains could well find themselves shelling out to the IRS.

paranoidandroid

If you have any doubts whether you would be earning too much or getting a huge inheritance, I'd think that it should be talked over with an accountant with experience of international taxation between the US and UK before you become a USC. Everyone and every situation is different, and relying on advice here from anyone that's not properly qualified to answer your question for that might prove costly.

exvj

I thought long and hard about this one.. I am in the final stage of the USC thing and I my thoughts were:


Tax
The overseas exemption only applies to earned income - not interest, pensions, capital gains, pensions etc. However, the tax rates are as high in the UK so double tax would take care of these things and reduce them to zero

There is no penalty for not filing a tax return - penalties only apply if tax is owed. Many Americans return after many years of not filing - they file and their bill is zero.

FLEXIBILITY
As you say, getting a GC is not easy. So getting the USC gives you freedom of movement. If you are married to a USC it's essential so you can be with them however circumstances change.


PARACHUTE.

If you never go back to the US for 15 years and have no intention, and can't be bothered wondering about tax, renouncing USC is a quick visit to the Embassy and that's it you are out of it.

HEALTH

If you are living in the US and you get a $500k health problem and your insurance company walks away and leaves you to die, you can come back to the UK, resume residency, stay a year and get fixed and then return to the US with no hassle.

I really sweated over the whole deal but I feel in control now and it's a must for the spouse of a USC

My USC spouse is much younger and prettier than me and she sees the sense of getting a Brit passport - especially if she wants to retire at 55 as she would have to pay enormous health insurance for 10 years on her own in the US. She would be better spending some of those early retirement years in the UK to have free health insurance and then return when her Medicare kicks in at 65

It's a heavily weighted YES to getting USC before you go...then you have choices and options - and things change- oh do they change...