livinginUSA

Hey all - would appreciate some advice!

I was talking to a friend who has been in the U.S. on a H1b for a couple of years now and he was telling me he was filing his self assessment UK tax form for the past tax year! He has no UK source income but claims he must file one. Is this true?

Me on the other hand have been a green card holder (through marriage) in the US for 5 years. I filed a P85 when I left (I called HMRC to make sure - I wasn't working before leaving no tax back when j left), I have never filed self assessment before (was always PAYE), and was under the assumption I wouldn't need to at all once I left the UK. Am I doing things correctly? I believed that non UK residents didn't need to file or pay UK tax - especially as I have zero UK sourced income. I don't need to file self assessment to the UK at all, right?

Thanks for any advice!

Hotscot

I seem to remember I had a self assessment form sent over when I first moved to the US.
I just sent them a letter telling them I don't reside in the UK anymore and that was the last of it.

livinginUSA

Interesting - I wonder if that's because you were filing self assessment before you left.

So I assume you file nothing in the UK now at all?

JAJ

Not true, as far as I know - unless for some reason he has failed to abandon his U.K. tax residence under the statutory residence test. If he is living in the U.S., it's probably quite expensive to pay additional British tax on top, so he should make sure he is only paying what he has to pay. Perhaps he needs some U.K. professional tax advice - The Chartered Institute of Taxation | Home

livinginUSA

His message to me was:

"Yeah, we do still need to do UK tax returns - self assessment. We have to declare everything we earn here, and all taxes, etc. You won't get charged more, but they need to know"

This didn't seem right to me - I moved along time ago and I know the SRT has slightly different rules, but I would assume he wouldnt be tax resident anymore at all! Especially with no income earned in the UK or UK sourced income.

As far as I know, if you are a non resident (I am because I have a green card and live permanently in the US, spend about 6-8 days a year in the UK over Christmas, and have no UK income) you literally file nothing to the UK. It's not like the US where a citizen will always be required to file a tax return. At least that's what I have been going on for years! Please let me know if that's correct

nun

This is wrong if he is a US tax resident. Your friend is making unnecessary work and should file a P85. That's what I did when I came to the US on an H1b. I haven't file a single UK tax form in the last 28 years.

Hotscot

I wasn't before, but yes, it is correct that I don't file in the UK.

livinginUSA

Thanks everyone for the responses - this topic had me really confused all yesterday, and slightly worried! Like I mentioned earlier, I got it in my head that maybe the UK taxes citizens regardless of their residence, like the US! That would have meant a lot of backfilling if true! Thankfully from what you guys say, no UK filing is required at all once you become a non resident and have no UK sourced income.

I will have a word with my friend and let him know that he may not need to be filing. I don't know, maybe there is a reason (maybe some UK ties) that requires him to do this, but to his knowledge he believed we all should be still reporting back to the UK.

Also, let me know if anything I have said here is false!

Hotscot

No need to worry...all the info is out there in Google Land.

https://www.gov.uk/tax-right-retire-abroad-return-to-uk

livinginUSA

You are correct! Thanks for the link - I really should have looked it up too, and I did when I moved - but I love chatting to actual people about it too, incase I am missing something

I haven't checked the SRT much and while a lot seems to have changed, I assume with living here permanently in the US with a green card, working full time, only visiting briefly over christmas, my only UK ties being a bank account with less than £20 and my parents + brother (I stay in a hotel when I visit), I would still be considered a non resident!
Phew! When I moved it used to be "leaving to live abroad permanently" and filing a P85 proving that would be enough.

Thanks again all for helping me and making me not stress out about this. Knowing I don't need to file anything makes me feel much better! I will continue to be a non resident therefore not have to file anything - plus I will inform my friend!

Hotscot

Understood

What's your friend do anyway, on an H1B? Just curious.

livinginUSA

Sure thing - he is a software developer

I briefly chatted again to him today and he stated that:

"Because I'm on a H1b, I'm supposed to keep the UK as my residence"

So, maybe that's a reason to do it? I sent him a link to the SRT info that states that a non resident wouldn't need to owe taxes on income abroad. Maybe he interprets that as still needing to let the UK know his situation, even if it means not paying?

Either way, it sounds like the majority of us who are NOT UK resident for tax, file absolutely nothing. I think some one would have heard or said something if we were supposed to be filing self assessment.

Hotscot

That's it, in a nutshell

JAJ

Except that H1-B holders do not have to keep a foreign residence, as far as U.S. immigration law is concerned. And even if in a visa category with this requirement, the U.S. does not expect that this be demonstrated by filing foreign tax returns as a resident.

livinginUSA

That the thing - there is a difference between tax resident, and immigration law resident - well said.

At this point, unless he has some UK tie he hasn't mentioned, it sounds like he, like everyone here, wouldn't need to file a self assessment as it wouldn't be required, right?