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Tax advice, living in US but working in UK

Tax advice, living in US but working in UK

Old Mar 19th 2008, 4:05 pm
  #1  
restopi
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Default Tax advice, living in US but working in UK

Hi there, first of all congratulate you for a great forum and a lots of good information. I have been looking through a lot of threads but couldnt find anything related to my case so it will be great if you guys can help me.

My wife (US citizen) and I (originally from Spain but with the Greencard now) lived for 3 years London until last August. We then decided to move back to the US and bought a house in Washington DC and we live here with our little son. I have been very lucky that my employer (a UK employer) has allowed me to keep working for them remotely from here, with an occasional trip to London (a week per month). So Im still in an UK payroll, being paid in ££ in an UK bank. I then transfer the money using CITIBANK (btw, i recommend their international transfer service) but for all purposes I live here in DC

Thats when my questions begin. I have been told I will need to pay taxes twice, the payroll retention in the UK and also income taxes for what I brought here. I though US and UK have a treaty and I dont need to pay taxes in both, but Im not sure. So, do I need to fill taxes in both countries? Do you know anybody on the same or similar situation? Do you see any problem with my situation? Also, do you know any good tax advisor in the DC area that I can talk to?

Again, thanks for your forum and help.... take care
 
Old Mar 19th 2008, 5:01 pm
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Default Re: Tax advice, living in US but working in UK

I was in a similar situation a while ago except the countries were reversed - I was based in the UK being paid as a consultant from the USA.

The first thing you should work on is establishing whether you are even liable to UK taxes at all. The UK does not tax you, as a general matter, if you are no longer resident there. Since you are living permanently in the USA you are no longer resident in the UK. I don't believe it matters if you are being paid by a UK source, as long as you are not considered resident there. However, you would need to check with somone knowledgeable about UK taxation to be sure. I would recommend going to the UK Inland Revenue website and downloading the booklet they have regarding taxation of people overseas. They may also be able to answer your questions by phone. As I recall the Inland Revenue were fairly accessible by phone though it was 10 years ago when I was contacting them. You may also want to consider using a tax expert in the UK.

If you are no longer liable to UK taxes then your company should stop deducting PAYE taxes and Social Security payments. You might need to change status and work for them as a consultant for them to be able to do this, ie pay you gross 'salary' without any deductions. Then you would just pay taxes as any other self-employed US resident. I would suggest having the money wired to your US bank account instead of the UK one as well.

If you like I can give you the contact info for my Washington DC tax consultant, he is experienced in tax matters for international people. PM me if you need this. However I am not sure if he could help you re the UK tax liability issue, and that is the first thing you need to address IMHO.
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Old Mar 19th 2008, 5:12 pm
  #3  
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Default Re: Tax advice, living in US but working in UK

Originally Posted by restopi View Post
Do you see any problem with my situation?
As well as tax advice, you need to pay heed to your immigration situation. Ensure you get suitable advice on this, since a tax accountant/lawyer is more likely to head towards saving you money on your taxes rather than ensuring the preservation of your permanent residency status in the US. Permanent residents are liable for tax on their worldwide income.
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Old Mar 19th 2008, 5:13 pm
  #4  
restopi
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Default Re: Tax advice, living in US but working in UK

Originally Posted by newXgate View Post
I was in a similar situation a while ago except the countries were reversed - I was based in the UK being paid as a consultant from the USA.

The first thing you should work on is establishing whether you are even liable to UK taxes at all. The UK does not tax you, as a general matter, if you are no longer resident there. Since you are living permanently in the USA you are no longer resident in the UK. I don't believe it matters if you are being paid by a UK source, as long as you are not considered resident there. However, you would need to check with somone knowledgeable about UK taxation to be sure. I would recommend going to the UK Inland Revenue website and downloading the booklet they have regarding taxation of people overseas. They may also be able to answer your questions by phone. As I recall the Inland Revenue were fairly accessible by phone though it was 10 years ago when I was contacting them. You may also want to consider using a tax expert in the UK.

If you are no longer liable to UK taxes then your company should stop deducting PAYE taxes and Social Security payments. You might need to change status and work for them as a consultant for them to be able to do this, ie pay you gross 'salary' without any deductions. Then you would just pay taxes as any other self-employed US resident. I would suggest having the money wired to your US bank account instead of the UK one as well.

If you like I can give you the contact info for my Washington DC tax consultant, he is experienced in tax matters for international people. PM me if you need this. However I am not sure if he could help you re the UK tax liability issue, and that is the first thing you need to address IMHO.
Thanks newxgate for the quick response, Ill check the UK Inland Revenue. Alos, Im interested in you DC tax consultant, although since I just joined the forum it seems I can not do PM in 24h hours... can you "initiate" the PM? Otherwise I'll try tomorrow...
 
Old Mar 19th 2008, 7:34 pm
  #5  
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Default Re: Tax advice, living in US but working in UK

Originally Posted by restopi View Post
Thanks newxgate for the quick response, Ill check the UK Inland Revenue. Alos, Im interested in you DC tax consultant, although since I just joined the forum it seems I can not do PM in 24h hours... can you "initiate" the PM? Otherwise I'll try tomorrow...
Have to post 3 times I believe before you can send PM's so you should be able to do it now as you have 3 posts

here you go http://britishexpats.com/forum/faq.p..._vb_pm_explain
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