British Expats - UK National Insurance Contributions

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UK National Insurance Contributions

Hi Guys,

Well finally have 5 minutes and a PC to post my first message since arriving in the US, and not surprisingly it's about money which the UK is still trying to screw out of me!!!

OK, question is...do I have to pay UK National Insurance contributions??

I am:

1. Employed by a UK based company, but work in their US office.
2. Working under an H1B visa, initially for 3 years, but most likely longer, subject green card approval.
3. Paid in GBP, but do not pay tax in UK - pay tax to IRS.
4. Am contracted out of SERPS.
5. Have no ties in UK, no property, nowt!

Well after lots of research (and a big thanks to those here who helped me), plus planning, patience and determination, I achieved the following in my first month in Ft Lauderdale -

1. Rented a house, established accounts for water, phone, electric etc
2. Got my SSN
3. Obtained a Florida driving licence
4. Opened a bank account, have cheque book, debit card and secured credit card (Citibank)
5. Bought a Toyota, part financed over 60 months to build credit rating
6. Leased a BMW - they were able to run credit checks on me in the UK

It's been pretty demanding and I haven't managed to hit the beach yet, but hope to soon. Oh and in between the above the job has kept me on my toes!!

All in all, it's been great, and I don't miss the UK one bit......just not impressed that I am still paying Â£265 a month on NI?

Festive greetings.....now just have to work out how to fix up my one zillion watt xmas lights!
Sean

:confused:

Re: UK National Insurance Contributions

Quote:

Originally posted by Slaphead
Hi Guys,

Well finally have 5 minutes and a PC to post my first message since arriving in the US, and not surprisingly it's about money which the UK is still trying to screw out of me!!!

All in all, it's been great, and I don't miss the UK one bit......just not impressed that I am still paying Â£265 a month on NI?

Sean

:confused:

Sean, the answer to your question depends on your future. If you decide that UK will be your domicile, then it might be worth it to make voluntary contributions. I suspect you've done the P85 with a tax advisor in the UK. I'm not sure why you choose to get paid in GBP (no faith in the dollar?). What is SERPS? anything to do with state pension?

G. Ross

Re: UK National Insurance Contributions

Quote:

Originally posted by Slaphead
Hi Guys,

Well finally have 5 minutes and a PC to post my first message since arriving in the US, and not surprisingly it's about money which the UK is still trying to screw out of me!!!

OK, question is...do I have to pay UK National Insurance contributions??

I am:

1. Employed by a UK based company, but work in their US office.
2. Working under an H1B visa, initially for 3 years, but most likely longer, subject green card approval.
3. Paid in GBP, but do not pay tax in UK - pay tax to IRS.
4. Am contracted out of SERPS.
5. Have no ties in UK, no property, nowt!

Well after lots of research (and a big thanks to those here who helped me), plus planning, patience and determination, I achieved the following in my first month in Ft Lauderdale -

1. Rented a house, established accounts for water, phone, electric etc
2. Got my SSN
3. Obtained a Florida driving licence
4. Opened a bank account, have cheque book, debit card and secured credit card (Citibank)
5. Bought a Toyota, part financed over 60 months to build credit rating
6. Leased a BMW - they were able to run credit checks on me in the UK

It's been pretty demanding and I haven't managed to hit the beach yet, but hope to soon. Oh and in between the above the job has kept me on my toes!!

All in all, it's been great, and I don't miss the UK one bit......just not impressed that I am still paying Â£265 a month on NI?

Festive greetings.....now just have to work out how to fix up my one zillion watt xmas lights!
Sean

:confused:

Sean,

The correct answer depends on your long term strategy. From your post it sounds like you have no plans to return to the UK (at least in the short term). In this case you do not have to continue paying NI - you should however start paying Social Security in the US. You can file with the Inland Revenue as a non-resident and the NI will be refunded from your departure date.

I used a TAX accountant to work this out, and it was pretty staightforward. I also get paid in UKP from the UK but work full-time in the US. Make sure you file your 1040 contributions quarterly if you don't want a hefty TAX bill at the end of the year.
You won't receive W2's as they are specific to US payroll deductions so if you use BCIS you will need transcripts etc.

Cheers

Re: UK National Insurance Contributions

Quote:

Originally posted by Gross50
..... What is SERPS? anything to do with state pension?

State Earnings Related Pension Scheme - the extra over and above the NI payment that you are required to make to fund a state pension linked to your earnings. UK taxpayerss have an option, generally worth pursuing if you are less that around 40 years old, to claim the SERPS deduction from the state and have it paid into a private pension scheme.

Re: UK National Insurance Contributions

Quote:

- In the situation you describe, I don't think you have to pay UK NI. I think the more pertinent question is do you need/want to? As already pointed out, it really depends on whether you intend to retire in the US or UK.

To qualify for Socal Security in the US, you have to pay 40 quarters of SS (10 yrs). So, if you think you are going to stay here, it might make sense to start SS payments now.

Having said that..... the UK/US have some sort of agreement re: credit for paying NI/SS overseas. So, if you retire in the US without 10 yrs of SS payments (you don't say how old you are), you can apply to be given credit for your UK NI paymennts. Vice versa, if you return to the UK to retire, and decide on UK pension, the UK will give you credit for US SS payments, as if you'd been paying NI payments. (If you do have 40 quarters of US SS payments, you can claim US SS retirement even if you've moved back to the UK).

What I haven't been able to figure out from reading the NI and SS Web sites is how this all translates into how much you'll get in state pension/SS retirement.

I think there's an expat financial company that gives advice on this stuff (don't know how much advice costs). If I find it, I'll post the address.

[Later] Found it:

http://www.britpensions.com/

Not sure whether you can stop paying them immediately or not - and I've no idea how working for a UK Company/being paid in the Uk will affect it. When I first came overseas, I worked for a UK company for 5 or 6 years that kept up my contributions for me, so never really needed to find out. But now that I am not working for a UK company, I looked into it, and found that 1) the voluntary contributions are pretty low, and 2) you have up to 6 years from when they were originally due, to pay them. So even if you stop paying now, I don't think you need to make a definite decision on whether you want to keep them up to date until the end of the decade. You should get (or can ask for) an annual statement showing your missed contributions and the final penalty free due dates. Best bet is to talk to the IR Centre for Nonresidents - +44 191 2257975.