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US tax resident now but still receive UK income

US tax resident now but still receive UK income

Old May 19th 2011, 12:11 pm
  #1  
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Smile US tax resident now but still receive UK income

Hi All,

I am a British cittizen but live in NYC and have become a US resident for tax purposes and have a question on some UK earned income. The details:

- live in US and earn main income there
- US income taxed in US
- earn some self employed income in UK
- US resident so need to declare to US authorities all income - right?
- do I declare in GBP or USD?
- double taxation treaty means i donb't get taxed twice - right?
- shd I pay UK income tax on the UK income or just declare it to the US? I think US tax is lower rate so I prefer to US tax but not sure if I have to pay in UK as it is earned there?

Any help would be HUGELY appreciated!!

Al
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Old May 19th 2011, 12:21 pm
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Default Re: US tax resident now but still receive UK income

Originally Posted by fraystein View Post
US resident so need to declare to US authorities all income - right?
Right... even income from the UK.


do I declare in GBP or USD?
For a US tax return, convert everything to $US.


double taxation treaty means i donb't get taxed twice - right?
Right, well... generally. There are exceptions but most people don't need to worry about them.


shd I pay UK income tax on the UK income or just declare it to the US?
If the income isn't automatically taxed in the UK and if you have the choice, use the country that gives you the lower tax rate. Regardless, you still need to declare the income on your US tax return.

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Old May 19th 2011, 1:56 pm
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Default Re: US tax resident now but still receive UK income

Thanks - super fast reply!

Pretty sure US is lower rate of tax but not sure if I have the choice... Need to find out but I suspect Her Majesty's Revenue & Customs will want their greedy hands on any income earned there.

Thanks!
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Old May 20th 2011, 4:05 am
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Default Re: US tax resident now but still receive UK income

Originally Posted by fraystein View Post
Thanks - super fast reply!

Pretty sure US is lower rate of tax but not sure if I have the choice... Need to find out but I suspect Her Majesty's Revenue & Customs will want their greedy hands on any income earned there.
They will want tax on UK source income but normally you can claim the personal allowance and the lower rate tax bands so it would usually be less than the equivalent US federal tax.

"Greedy hands" ... a pejorative comment like that suggests you might wish to look for a genuinely low tax jurisdiction to make your future. Perhaps Singapore or Panama?
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Old May 20th 2011, 12:27 pm
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Default Re: US tax resident now but still receive UK income

Originally Posted by JAJ View Post
Perhaps Singapore or Panama?
Singapore doesn't have low taxes though...
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