wygde3

I'm being posted to the US at the end of the year for up to 3 years.

I have a home in the UK, a holiday home in Australasia and am looking to buy a holiday home in the next month or two in the UK.

My company provides Deloittes to do my US tax returns throughout my time in the US and to do my UK tax return in the tax year of departure and return to the UK.

My worry is ... What tax issues I am getting myself into? The company provides Deloittes to look after the company's tax position (which is fair enough). So I need help from someone who can optimise my UK and US tax position.

I've been scouring the web to look for who I can use. I see Buzzacott (who are said to be expensive). I see Pete Newton (who is recommended by several but I can't find him in a CFA site search of members ... Is he there?).

Would really appreciate guidance on who I can use to look and advise on UK/US tax, rental properties and final salary pensions.

Thanks in advance...

Pulaski

Are you planning to rent out your home in the UK? Are your holiday homes (going to be) rented out?

Bob

A lot.

You need tax help on the year you leave the US too.

The US taxes on world wide income, so holiday homes are going to add extra hassle, but you can get a idea about that by looking at the few recent threads that people have asked about their homes and renting them out.

Pete Newton has been recommended a lot by BE people though.

wygde3

Yes, definitely renting out home in UK. Also, most likely to rent out new holiday home in UK.

Does it matter re US taxes if I buy the UK holiday home when already in the US? Or should it be bought before I go? Or no difference?

wygde3

On Pete Newton ... Yes, I have seen a few good words. But without wishing to cast doubts because I have no reason to ... But he has CFA after his name and I'm thinking of contacting him but I can't find him on the CFA register. Am I doing something wrong?

Pulaski

I doubt if it makes any difference when you buy the UK holiday home, but you are going to make things even more complex than they already are, because when rented out, holiday homes are subject to a completely different schedule of the tax code in the UK.

From what you have said, or rather not said, your Australasian holiday home sounds like it is not rented out, right?

wygde3

On the Australasian home ... It is rented on an occasional holiday let basis. Last year just about 25 days in the whole year. Expenses much greater than income.

On the different tax schedule ... How is it different? Will my rented holiday home not be subject to the same rules as renting out my primary home whilst I'm in the US?

Pulaski

Income from rented holiday home is taxed as an operating business, for example as if you were in business as a plumber, not as income derived from the renting of property, so the rules for deductibility expenses are completely different. If you rent a holiday home and your own home, you will have two separate tax calculations for the purpose of calculating taxes due in the UK.

Interestingly, you can use the income from holiday letting to support payments into a personal pension account, whereas that is not possible for income from "normal" (non holiday) rental of property. If I remember correctly there is also a cap on the maximum number of days per year that a holiday home can be rented out under the holiday home rental rules.

Noorah101

Pete Newton: http://www.britishexpatstax.com/

Rene

wygde3

Thanks for the link, but I was looking for confirmation on an independent register that Pete is indeed a CFA. (I'm almost embarrassed to check, but don't want to be caught out.)

nun

If your company will pay for Deloitte why bother going elsewhere.

It sounds as if you'll have tax to deal with in 3 places US, UK and "Australasia" and I'm not sure how well a small company will deal with that.

Areas you need to investigate for taxation are:

US tax on rental income (its all US taxable), UK non-resident landlord and the status of the Antipodean taxes on rental income.

Pensions, specifically what type of non-US pensions do you have and how are they covered by the US/UK or US/other county tax treaty.

Will you be paying FICA while in the US or will you continue NICs? If you do pay FICA you should look into paying Voluntary Class 2 NICs.

Investments. If you own any pooled investments like unit trusts outside of pensions covered by the treaty you should probably sell them or at least work out the effect of the IRS PFIC rules and the tax that you will have to pay on them each year. That includes funds held in ISAs

nun

If you want advice on organizing and doing your taxes that you don't think you can get form Deloitte the two best folks are probably:

Liz Zitzow at
http://www.britishamericantax.com

David Treitel at
http://www.americantaxreturns.co.uk