1. Helping you piece together
the Expat tax puzzle

2. Helping you piece together the Expat tax puzzle
Changes to UK Tax System Impacts American Expats
What are the implications?
 UK is now taxing worldwide income
 Impacts international earners
 Impacts US citizens living in the UK

3. Helping you piece together the Expat tax puzzle
UK Residency is Based on Length Stay
Each day you are physically in the UK at midnight,
counts as one day for tax purposes
 If you plan to stay in the UK less than 2 years, your
residency status will be based on the number of days
your are in the UK at midnight
 If you plan to stay in the UK more than 2-3 years, you
could be regarded as a resident and may be impacted if
you purchase property in the UK
 If you plan to stay for 3 years or more, you would qualify
as a resident from the date you arrived, for tax purposes

4. Helping you piece together the Expat tax puzzle
UK Residency is Based on Length Stay
 Your residency status will not impact
the taxable amount of your UK earned
income
 UK earned income is not taxed based
on your residency status
 Only foreign earned income is taxed
based on your residency status

5. Helping you piece together the Expat tax puzzle
Tax Implications based on Domicile Status
Domicile Status is Intangible compared to Residency status.
Domicile Status is based on the following:
 Your father’s domicile at the time of your birth
 If your father changes his domicile status
before your 16th birthday, your domicile will
be the same as your father’s
 You will retain the same domicile status as
your father unless you take legal steps to
change it or leave the country of domicile
permanently

6. Helping you piece together the Expat tax puzzle
Implications based on HMRC New Tax Rules
UK Tax for Long Term Visitors:
As of 6 April 2008, long term visitors residing in the UK more than 7 of the last 9
years, can only use the remittance basis if they pay a fee. Otherwise they must either
pay taxes on foreign income.
 Exception: Expatriates earning less than £2,000 in
foreign income are exempt from paying tax or the fee
 All other non-UK domiciled individuals who are UK
residents are required to either:
 Pay the £30,000 annual fee
 Be taxed in the UK on their worldwide income
Note: You should ensure your accountant checks the country specific
taxation treaties to ensure you are not double taxed

7. Helping you piece together the Expat tax puzzle
How to Avoid Double Taxation
 There are double taxation treaties
that can help you avoid being double
taxed.
 You may qualify for tax credits to
avoid double taxation.
 See an experienced UK Tax Advisor
for specific information for your
particular case

8. Helping you piece together the Expat tax puzzle
Tax Implications for Expatriates
If you are not a permanent resident of the UK and you are domiciled abroad
you will need to pay taxes on an arising basis or on a remittance basis.
Arising Basis
• All UK and Foreign income and gains
are taxed
or
Remittance Basis
• UK income and gains, and all foreign
income and gains brought into the UK are
taxed
• Foreign income left abroad is not subject
to the UK remittance basis tax guidelines

9. Helping you piece together the Expat tax puzzle
Tax Implications for Expatriates
Under the remittance basis all foreign business interests or investment income
arising abroad, will not impact your tax burden in the UK including:
 Interest Earned
 Dividends
 Income from property

10. Helping you piece together the Expat tax puzzle
See Your Tax Advisor
US citizens (expatriates) living or working in the UK should contact an
experienced chartered tax advisor for more information:
 An experienced tax advisor can help determine residence and
domicile status, and ensure UK tax returns are completed properly, thus
saving you money
 UK tax system is based on “self assessment” where
individuals asses their own residence and domicile position, which can
lead to mistakes if you are not famililar with all aspects of the law
 Rules governing residence and domicile are complex and it is best to
seek expert advice in determing your status
 Understanding of residence and domicile is based on “case law” rather
than legislation or guidance from the HMRC, this make the determination
of status even more complex

11. Helping you piece together the Expat tax puzzle
Let Us Help You!
For more information on American Taxation for
Expatriates or UK tax questions for US citizens,
please contact Greenback Tax Services at:
www.greenbacktaxservices.com