If you have answered yes to our poll, you may be required to prepare a US Federal Tax Return with the IRS. US tax law states that a US Citizen must declare worldwide income no matter where he or she lives around the world.
EDA Professional Services is a Scottish based accountancy firm that can assist US Citizens with their filing requirements. We can also help even if you are not based in the UK.
Currently Scotland has different levels of taxation than the rest of the UK. This means that you can end up paying more tax in Scotland (the higher rate threshold did not increase in Scotland meaning that the 40% rate comes at a smaller level). As there is no tax treaty with the US and Scotland it may mean that you cannot claim any additional taxes you pay in Scotland as a Foreign Tax Credit on your US Return.
Depending on the level of taxes that may be due to the IRS, you may be required to prepare up to four years tax returns – even if there is no balance due.
If you are a US citizen living in the UK and would like to discuss this, please do not hesitate to contact us at email@example.com. We look forward to hearing from you.
Please note that though this blog specifies the UK where Americans are living, it can also refer to other countries around the world. The United States has primary taxing rights over (more or less) every country.
Did you know that you have to file details of your Foreign Bank Accounts with the American authorities?
The deadline for submission of the Foreign Bank Account Reporting (FBAR) Forms is 30 June 2015. This relates that the bank accounts that you have outside the USA during the calendar year ended 31 December 2014.
To decide whether you are required to file an FBAR for 2014 you must check the following:
1. Have a non-US Bank account or have an interest in a foreign account
2. The accumulated total of all your accounts is greater than $10,000. About £6,000 if you are in the UK.
What you need to do is review your bank accounts and look at the highest value of your accounts during the year. Sometimes you could have 2 bank accounts and transfer money between these accounts (i.e. the same money transferred). Once the values are converted to US Dollars and is above $10,000 you must file the form with the Department of the Treasury before 30 June.
Failure to file this form can result is serious penalties.
If you have any questions about this form, please do not hesitate to contact us now at firstname.lastname@example.org.