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Green card tax

Lazder

Registered Users (C)
Hi, can someone explain to me please.. if I go to USA and pick up gc and then come back to UK for lets say 6 months and in those 6months I am working and earning a salary in UK... Will this salary which already has been subjected to UK taxes then be subjected to USA taxes as well???

Thanks
 
Hi, can someone explain to me please.. if I go to USA and pick up gc and then come back to UK for lets say 6 months and in those 6months I am working and earning a salary in UK... Will this salary which already has been subjected to UK taxes then be subjected to USA taxes as well???

Thanks

You should consult a professional that is familiar with the UK and US tax laws.

What I write below is based on bits of information I gathered from different sources.

DO NOT ACT UPON WHAT I WRITE. CONSULT A PROFESSIONAL


The IRS will express interest in your UK income. In fact, according to the US law you must report at the end of the fiscal year all your incomes and investments around the the world. This is the famous FBAR (Foreign Bank Accounts Report).

Yet this does not mean that you have to pay additional tax in the US. It depends on whether the US and UK have a Tax Treaty and whether it applies to your income. If so, then the treaty will most likely prevent double taxation. For example, if your center of life, in a fiscal year, is in the US and the US tax is higher than the UK tax then you would need to pay only the difference. If it is lower, then you would not need to pay any additional tax in the US for that income. The income may be from a salary, property, investment etc.

Note that US taxes on investments outside the US may be a bit aggressive (Link: When Becoming a U.S. Resident, Beware of PFIC Rules).

Tax Treaty does not necessarily cover social security taxes. For this there should be a separate Treaty. If such a treaty exists then it protects you from double taxation. If not then, depending on where your center of life is and other factors, you may need to pay in the US the social security tax on your UK salary income.


Bottom line: consult a professional before doing anything irreversible that may cause you financial damage
 
Hi,

1) Once you become a PR (permanent resident, aka GC holder) you're world wide income is taxable.

2) Depending on the types of income you are referring to different rules apply:

If you were/are a full time employee of a company (not a limited company etc) things are MUCH simpler.
The UK does have a tax treaty with the USA which for 'earned' income nullifying double taxation for most people.
Google: 'IRS Foreign Earned Income' exclusion.

If you do have any investment income, things get more complicated, and it is possible that you will still owe tax on this in the US regardless of taxes paid in the UK.

3) If the aggregate value of your 'foreign' financial accounts exceeds $10000 USD at anytime during a calendar year; you will be required to lodge an FBar. Google: FBAR.

For a simple return it is possible to probably sort this out yourself; though you'll be stuck reading the IRS guidance for some time which may drive you a little crazy. I would recommend getting a professional familiar with foreign income to do your first return anyway. You can use this time to get more familiar with the US tax system and ask questions regarding those areas you are unsure about.

Prices can vary significantly, but you can get find more than capable help for a reasonable price.

AJK

Hi, can someone explain to me please.. if I go to USA and pick up gc and then come back to UK for lets say 6 months and in those 6months I am working and earning a salary in UK... Will this salary which already has been subjected to UK taxes then be subjected to USA taxes as well???

Thanks
 
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