Dual citizen full time employed UK + seasonal job in USA tax??
 

Bit of a complicated tax conundrum, any knowledge or help on the matter would be massively appreciated.

I am a dual national, (live in UK but hold USA passport due to birth place), I currently work full time in UK and am aware that I need to also submit a USA tax return form annually.

Here is the issue: I am looking to go out to California next year and work out there just for a couple of weeks seasonally (while on annual leave from my UK job). Does anyone have any idea how this would work tax wise with two incomes in two different countries at the same time?? or if it is even possible??

Thanks :)

Re: Dual citizen full time employed UK + seasonal job in USA tax??
 

It is certainly possible. You pay tax in both countries, the US tax on the US income is irrecoverable (you can't get it back), but you will get a tax credit for it on your UK tax return.

Re: Dual citizen full time employed UK + seasonal job in USA tax??
 

Thanks for the reply,

Just to clarify your answer, when you say you pay tax in both countries, does that mean I would have to pay tax in both countries on both salaries added together? or would i just pay US tax on the money earned in the US and then UK tax as I normally do on my UK salary?

Thanks!

Re: Dual citizen full time employed UK + seasonal job in USA tax??
 

No, I meant tax on the US income in the US and tax on the UK income in the UK. :) ..... Effectively it will be very similar to your current situation, but with a little US income added. .... It is ppssible depending on your income and marginal tax rate in the UK that you could have to pay a little incremental tax on the US income, so a little above what you paid in the US. For example if you paid 25% tax in the US and your marginal rate is 35% in the UK, then you would have to pay 10% additional in the UK, .... I think.

Re: Dual citizen full time employed UK + seasonal job in USA tax??
 

You pay in the UK as normal, claim a UK foreign tax credit for any tax you pay in California.

You file a 1040 and a 2555 and on the 2555 you list how many days you were in the US to establish that you are tax resident in the UK. You pay the tax you earn in California via getting a W-2 and putting that on the 1040 and the State return in the usual way.

Essentially you pay the tax in both places and claim a tax credit in the UK for the US taxes - not sure what the scope of a UK foreign tax credit is, whether it will include the California State tax for example.

You'll also have to get a "certificate of coverage" under the Social Security totalization agreement so you only pay NI and not FICA.

Re: Dual citizen full time employed UK + seasonal job in USA tax??
 

Yes, but watch the amount of time you spend in the US. If you spend 30 days or more in the US in a tax year, you may not be able to qualify for the foreign income exclusion on your UK income when you file your US federal return.