Go Back  British Expats > Living & Moving Abroad > USA
Reload this Page >

Expat tax hassle question

Expat tax hassle question

Old Jan 22nd 2004, 12:44 am
  #1  
A lion in your lap
Thread Starter
 
elfman's Avatar
 
Joined: Jul 2003
Location: Sparta NJ
Posts: 7,604
elfman has a reputation beyond reputeelfman has a reputation beyond reputeelfman has a reputation beyond reputeelfman has a reputation beyond reputeelfman has a reputation beyond reputeelfman has a reputation beyond reputeelfman has a reputation beyond reputeelfman has a reputation beyond reputeelfman has a reputation beyond reputeelfman has a reputation beyond reputeelfman has a reputation beyond repute
Default Expat tax hassle question

I would be really grateful if anybody out there could give me some definitive advice here:

My (American) wife and I emigrated to the US from the UK at the end of September 2002. We both got UK tax refunds, which I thought meant the Inland Revenue was saying see ya, adios, have a nice life, end of story.

My wife works for a US investment bank and when we moved here she simply transferred within the company. In January 2003 my wife was paid a modest bonus by her employers, which was fully taxed in the US (ie she only netted half of it). Towards the end of last year her company's UK accountants (KPMG) started hassling her for her tax records from the UK, and today she has received notice from KPMG that she owes the Inland Revenue 1500 quid out of her Jan 2003 bonus (as we understand it) and has to pay it by 31st Jan. How can this be, when she permanently left the UK a fraction under six months into the 2002-2003 financial year and has been fully taxed in the US on all income subsequent to our move?

Any useful advice/info will be extremely welcome and very much appreciated.
Ta
elfman is offline  
Old Jan 22nd 2004, 1:08 am
  #2  
Ping-ponger
 
dunroving's Avatar
 
Joined: Jul 2002
Location: Dreich Alba
Posts: 11,964
dunroving has a reputation beyond reputedunroving has a reputation beyond reputedunroving has a reputation beyond reputedunroving has a reputation beyond reputedunroving has a reputation beyond reputedunroving has a reputation beyond reputedunroving has a reputation beyond reputedunroving has a reputation beyond reputedunroving has a reputation beyond reputedunroving has a reputation beyond reputedunroving has a reputation beyond repute
Default Re: Expat tax hassle question

Originally posted by elfman
I would be really grateful if anybody out there could give me some definitive advice here:

My (American) wife and I emigrated to the US from the UK at the end of September 2002. We both got UK tax refunds, which I thought meant the Inland Revenue was saying see ya, adios, have a nice life, end of story.

My wife works for a US investment bank and when we moved here she simply transferred within the company. In January 2003 my wife was paid a modest bonus by her employers, which was fully taxed in the US (ie she only netted half of it). Towards the end of last year her company's UK accountants (KPMG) started hassling her for her tax records from the UK, and today she has received notice from KPMG that she owes the Inland Revenue 1500 quid out of her Jan 2003 bonus (as we understand it) and has to pay it by 31st Jan. How can this be, when she permanently left the UK a fraction under six months into the 2002-2003 financial year and has been fully taxed in the US on all income subsequent to our move?

Any useful advice/info will be extremely welcome and very much appreciated.
Ta
You should be OK if you paid tax on it in the US, b/c of the US/UK tax treaty, i.e., it prevents you being double-taxed. She received the bonus during the US 2003 tax year, so I would just tell this to KPMG first and see what response you get. They may ask for her US tax records.

The only possible weirdness is if, because she received the bomus during the UK 2002-2003 tax year, it may be that she should have paid tax on it in the UK, rather than the US, but I doubt it. That would mean she'd also be expected to pay tax on her salary Jan-April 2003 and that just doesn't make sense.

Both times I moved (US-UK and UK-US) it was in the middle of the UK tax year but the end/beginning of the US tax year, so it got a bit confusing. I just oaid taxes in whatever country I ws living in at the time, and so far no-one's come after me.

Good luck - it can be a bit unnerving when a company come after you.

Usual caveats - I'm not a tax expert, etc. Just sharing my experiences.
dunroving is offline  

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Contact Us - Archive - Advertising - Cookie Policy - Privacy Statement - Terms of Service - Do Not Sell My Personal Information

Copyright © 2018 MH Sub I, LLC dba Internet Brands. All rights reserved. Use of this site indicates your consent to the Terms of Use.