PetW

Can anyone offer me a little advice - I am a dual citizen, Brit and US living in the US.
My question relates to my financial income and taxes. I am aged 70 and have been retired a number of years.
I currently receive my retirement pension which amounts to just over $800 per month plus around $500 from a private pension all after tax deducted from source in the U.K.
In addition to this I receive a widowers Social security payment of $300 here in the US which is taxed in the US.
The $300 is almost taken up with my Medicare and prescription payments are deducted from source here in the US.
My question is - Would I benefit financially if I opted out of the UK tax system and declared my UK pension on my US tax returns ? or would I be better sticking to how I am currently ?
Any advice will be appreciated. Thank you.

lansbury

You are legally required to declare all your world wide income on your US tax return, even if you pay tax on it in elsewhere.

Pulaski

Where do you live, which country?

Are either of your British pensions connected to government employment?

If you live in the US the general principle is that you should only be paying tax in the US, in other words, your British pensions should be paid gross.
This too!

PetW

Thank you for your replies. My pensions are not related to government employment.
I live in the US and I have declared my UK income on my US tax returns. I just noted that the tax had been deducted from source in the UK and the amounts were Net amounts received.

PetW

I do declare my UK income on my US tax returns

Pulaski

OK, so you need to tell your pension providers that you are not resident in the UK for tax purposes. How much the net benefit will be, after paying taxes in the US, depends on your exact circumstances in the US.

PetW

Thank you and appreciated.

lansbury

You need to complete these forms and send them to the IRS. They will forward the information to HMRC.

https://www.gov.uk/government/upload...idual_2002.pdf

https://www.irs.gov/individuals/inte...ation-requests

Pulaski

You're welcome.

lansbury

Sorry for the misunderstanding but this

implied you were not declaring the UK income.

Pulaski

So were you also paying tax in the US on your net UK pensions? Did you claim a credit for tax paid in the UK?

If you paid US taxes on your net pensions and didn't take a credit for UK taxes paid, then you will need to refile as many years of tax returns in the US as you have been doing this/ are allowed by the IRS (whichever is lesser), as you will have overpaid taxes.

PetW

Ok thanks, yes this has been the case. So I will get onto this and have it sorted out.

morpeth

If I recall the IRS has limits to how many years you can re-file if you want to receive a refund , but no limit if re-filing would result in additional taxes !

Cook_County

If you have paid too much UK tax, you will need to reclaim the tax overpaid from HMRC. Hopefully, you've filed your FBARs...

PetW

Thank you all, your advice greatly appreciated.