hexland

I have recently moved (semi)permanently to the US (Los Angeles) from Scotland. I have been coming and going over the past few years on visa waivers, but I finally got my H1-B in December, and moved over here on Jan 1st.

I've been to the Social Security office, and I should get my SS# very soon... and I've read through the finance article on this board - so that should come in handy when trying to establish a nice line of credit.

However, I haven't seen any posts or articles dealing with the 'tidying up' of loose ends back home on leaving - and it's something I'm starting to get a little worried about. I was hoping some of you folks who have done this already might be able to help.

1. Should I have informed the Inland Revenue of my leaving? (If nothing else, I should be due a tax rebate for the period of Jan-Mar 2006/7)?

2. I'm only planning on remaining here in the US for about 5-7 years (but plans change) - with this in mind, should I continue to pay NI payments back home? (I'm told that if I return home, and have any kind of gap in NI payments - it can make life very very very difficult)

3. Back in Jan 2006, my old employer went into administration. I immediately started work with a new employer, but only received statutory redundancy (the old company's assets were frozen because of a law suit). I've since been told that I will be assigned a sum (not much, a couple of grand) from the liquidation of the company (in march 2007). I assume this will be taxable, however from what I've gleaned from various messages on this board - would I refrain from paying UK tax, and declare the money here in the US?

4. What do I do with my pensions back in the UK? Can I continue to contribute, or should I freeze them (or cash them in (is that even an option))?

5. When I bought my first home back in 1992, I purchased an endowment mortgage... the endowment projection was far short of the house price, so I converted the mortgage to a repayment but continued to pay the endowment (at the time, it wasn't worth cashing in). Should I continue paying this (can I continue?), or cash it in?

6. With regard to establishing credit... I have been using my American Express in the UK for a number of years now (the account has always been kept in excellent credit). Can I use this to my advantage when perhaps applying for a US based credit card (another American Express, perhaps)?

7. I still own my home in the UK (although it's laying empty - I don't really like the idea of renting it out). I don't want to sell it quite yet (there's still some work to be done on it anyway) - but are there any gotchas I should look out for, by hanging on to my home?

I have more questions, but I'm sure thats enough to be getting on with... Any help would be appreciated.

scrubbedexpat099

1 If you have continuing UK income you will have continuing UK tax, you can notify them of your US address.

2. Dunno, I do know that somebosy who does needs more oinfo to answer.

3. Unlikely to be UK Taxable, US Tax maybe.

4. Impossible to answer, see an IFA.

5. Move makes no difference, also see an IFA.

6. So I am told, not done it myself.

7. US Capital Gains Tax. Maybe.

Bob

P-85 to let inland rev know that you ain't a UK resident anymore, and to claim and taxes back for the year.

As for continuing NIC's, depends on your age, how much you've contributed and all that...but because of the tax agreement, you can use your SS in place of NIC's.

As for what to do with your pension scheme, well depends on what they are, but you ain't a resident, you probably can't contribute to them anymore, and you'll probably get hit hard for cashing in early...

For getting credit, read the faq in the US lifestyle section, and do a search on the subject, it's come up a lot, and AmEx is a good way of getting a credit card here.

As for your house, wouldn't know, but you'd want to be careful of capital gains, how much you pay depends on how long you've lived there in the last 3 years or something, I can't remember...best ask an accountant.

Elvira

Get a US accountant who is familiar with dual taxation agreements (definitely not H&R Block ...). This is particularly important re. your UK house and any plans you may have to sell it in the future and whilst still resident in the US.

You will have to file a UK tax return for 2006-07, including the 'Foreign' section.

It is probably a good idea to continue NI contributions - only costs the equivalent of a Latte a week.

Some of your question may be answered by posters at the International Expats board at the Motley Fool: www.fool.co.uk. They also have separate boards for people discussing pensions and endowments.

NB: Make sure you keep your UK bank accounts active!

Kestrelbms

1. Yes - Form P85: It helps HMRC decide how you should be treated for UK tax purposes after you leave.

2. It is advisable. If the required NI contributions have been met you remain eligible for UK State Pension. It is possible to pay a lump sum to the Dept of Works and Pensions to make-up any NI shortfall. Look at leaflet SA 33 which deals with the US/UK Social Security agreement - it can be downloaded at http://www.dwp.gov.uk/lifeevent/bene...sa33-oct05.pdf
This is updated to October 2005. The number of years contributions for a full UK State pension is about to be reduced for males to 30 years-a change in legislation to give efect to this is expected this summer.

3. See the UK/US Double Tax Treaty bulletin at www.hmrc.gov.uk/bulletins/tbse6.pdf - you can't pay tax twice; you're still entitled to your UK tax allowances.

4. The rules re continuance of contributions to a UK pension are strict. If you remained employed by the UK company and have been transferred for a short period you can possibly continue as an active member of the UK pension scheme. But you need to have net relevent earnings in the UK. If you continued to contribute to a personal pension without a break. OK. Most likely your pension will be frozen - getting 0 real growth and poor benefits. Then its best to transfer, probably to a SIPP.

5. Look at a TEP - Traded Endowment Policy

6. Get a UK Credit Check done, give it to the US providers.

7. None, as far as I know.

miss scouse atl

[QUOTE=Bob;4327084]P-85 to let inland rev know that you ain't a UK resident anymore, and to claim and taxes back for the year.
QUOTE]

Do you just fill the form in, or do they need your last P-45 aswell??.

Ive left my P-45 at home and nobody back there can find it, Im a bit unsure what to do about it, any ideas ??

miss scouse atl

sorry i cocked the quote up lol

TruBrit

amex were brill with me both in the uk and here. i got a usa amex card immediately i got here, no questions asked however i did and still do have good credit rating in the uk.

btw...hiya and welcome to BE

Bob

I can't remember, but I think they need a copy of the P-45...they might be able to process it without, I don't know...

miss scouse atl

Cheers Bob....maybe Ill call them to find out......I want my bloody tax back lol

neil

An earlier post talked about NI contributions and social security payments in the US. If you're planning to stay in the US for only 5 years there is a way to exempt yourself from social security payments - I did it initially but now have settled here. My company worked it out for me - think they had to show I was contributing to something in the UK, and I had to sign something to say it was my intention to return within 5 years.