Originally Posted by Bob

I don't know the answers, but without the above, you'll not get very much in the way of meaningful answers.

Originally Posted by lansbury

Hope I can help as both my wife and I hold dual US/UK citizenship and between us we collect 4 pensions from the UK soon to be 5. A mix of both state and private.

It helps that you are both, I take that from what you have posted, dual citizens. Before I become a dual citizen my pensions were taxed in the UK. My CPA completed my US tax return by declaring that UK income and showing UK the tax I paid on that income as well. Basically it works like this in a simple form. If on that income I paid tax in the UK of the equivalent of say $1000, and in the US the same income would be taxed at $1100, I would owe the IRS $100. As to the level of tax owed to the IRS on a given income not easy to say, because the US tax system allows you to to deduct certain items from your taxable income, and depending on how much they are worth in a tax year changes by how much you claim, and how much you owe or overpaid that tax year.

Being dual citizens makes it easier. You can claim exemption from UK income tax on your pensions, if you are a US citizen living in the US. There is a form from HMRC which you need to fill out, you send that with another IRS form and fee to the IRS. The IRS send the HMRC form onto HMRC certifying you pay taxes in the US, and HMRC give you tax exemption in the UK and notify your pension providers. All my wife's and my UK pensions are paid to us without income tax being deducted. HMRC will talk you through the process if you call there office that deals with expats, or your own tax office.

If either of you receive a government service pension there are slightly different rules on where that can be taxed. If that is the case please say and I'll post that.

Depending on where you choose to live there might well be State income tax as well. For example in Oregon we have State income tax and no sales tax. In Washington State they have sales tax and no State income tax.

The big thing you need to understand and have money to pay for is health insurance. Health care costs of very high and you really need to understand the system and the costs and how you will pay. There is no popping back to the UK for NHS treatment once you leave.

Originally Posted by ian-mstm

Generally speaking, the UK/US tax treaty prevents double taxation... so if your pension is taxed in the UK it will not be taxed in the US. If you're also a US citizen, you must still file a US tax return... indeed, by law, you must file a US tax return each year... even if you're not living in the US.

That said, your earlier comment is somewhat curious. You say you want to "maintain our dual citizenship" which implies you are a dual UK/US citizen... but you also wrote you want to "live there as a permanent resident" which implies you are not a US citizen - as you can't be both a PR and USC at the same time. Would you please clarify?

Ian

Originally Posted by Ozzidoc

Basis for a wiki article?

Originally Posted by Jerseygirl

I don't think it's a problem as many people receive a pension from the UK. Your largest problem is probably going to be healthcare costs.

Originally Posted by Morris07

Can you perhaps throw a bit more light on healthcare costs? I know its all private healthcare instead of NHS, how much would it cost say for a couple in their mid-50s, with a couple of non life-threatening ailements?

I know that is a whole new minefield we will have to tackle with and costs can be high...!!! but we want to look at all options before we decide to move lock stock and barrel to the US..

Originally Posted by Morris07

... we have been advised to become 'permanent residents' instead of becoming a proper US citizen to dual citizenship.

Originally Posted by Morris07

Ian, thanks your response. We are not US citizens, but are planning to live in the USA as 'permanent residents' since our daughter is sponsoring us to come and live there as retirees. Although we will not be dependent on her financially for our day to day living, we will still come there as her sponsors.. I hope that makes sense to you.

Originally Posted by nun

As a UK citizen, if you become resident in the US then your UK pensions will be free of UK tax and you will just have to pay US tax on them.

Originally Posted by Morris07

I am unsure about the US health costs for people in their 50s..., still got to investigate on that matter, but if you have any info, that will help greatly..

Originally Posted by Morris07

Can you perhaps throw a bit more light on healthcare costs? I know its all private healthcare instead of NHS, how much would it cost say for a couple in their mid-50s, with a couple of non life-threatening ailements?

I know that is a whole new minefield we will have to tackle with and costs can be high...!!! but we want to look at all options before we decide to move lock stock and barrel to the US..

Originally Posted by lansbury

We are in our early 60s and my wife in a high risk pool, she is diabetic. Our current medical insurance, that is just insurance, does not include deductions and co-pays, with this years premium increase has this month gone up to $16K a year. Being in your 50s it will be cheaper, but it goes up yearly and when you reach certain ages.

Originally Posted by Giantaxe

Iirc, you guys are in a better position because you will qualify for Medicare at age 65..............................(snipped)


As I've said before, unless you are independently wealthy, you really really have to think through the financial consequences of moving to the US in later life because of the heathcare issue, especially if you are not going to be working.