US Citizens in the UK
A conditional bilateral agreement between the US and UK tax authorities has recently been signed. Under the agreement (which has still to receive parliamentary approval) banks will pass information on US account holders to HMRC who will then notify the IRS.
This is just a further measure brought about by the IRS to capture information on US citizens living abroad who are required to file IRS returns.
Many US citizens perhaps do not realise that even though they are not residing in the US nevertheless they still have to file and IRS return for their worldwide income and even though they pay taxes in the UK in some instances there still may be further tax to pay in the US.
An example of this is capital gains tax on the sale of a main residence and dividend income. There are also onerous disclosure requirements on an IRS return where US citizen owns more than 10% of a company. Penalties for non-compliance are quite severe.
Here at Tuchbands we act for several US citizens whom we advise with regard to US tax return filings.
Written by Philip Woolfson
Philip is a Senior Partner of Tuchbands, a dynamic firm of North London accountants based in Golders Green. Philip has handled accounts and taxation for a wide range of industries, from property investment through to the fashion industry and in his 35 years has helped hundreds of businesses to thrive in both rising and falling markets.