US Taxes for Americans Living in the United Kingdom
Living in the UK as a US citizen means you have obligations to both the IRS and potentially HMRC. The US-UK tax treaty provides significant relief, but applying it correctly requires understanding which income is sourced where, when treaty tie-breaker rules apply, and how FEIE interacts with UK PAYE. We handle both sides: your US Expat return and, where needed, your UK Self Assessment.
Is this for me?
- US citizens or green card holders residing in the United Kingdom
- Paying UK income tax (PAYE or self-assessment) and US taxes
- Claiming treaty benefits to avoid double taxation
- Working for UK employers with PAYE withholding
- Planning your residency transition and split-year treatment
Why this is complex
- UK income tax is paid at source (PAYE) but doesn't cover all your US obligations
- The US-UK tax treaty has nuanced provisions that require professional interpretation
- FEIE is usually the wrong choice for UK-based Americans, FTC works better
- UK residents must declare worldwide income to HMRC once resident
- Pension contributions and NI affect the FEIE calculation in subtle ways
Recommended plans
- ✓ Everything in Premier
- ✓ Foreign Earned Income Exclusion (Form 2555)
- ✓ Foreign Tax Credit (Form 1116)
- ✓ FBAR filing (FinCEN 114) included
- ✓ Statutory Residence Test & split-year review
- ✓ Non-resident landlord and UK property income
- ✓ UK company salary/dividends for non-residents
- ✓ Everything in Leaver / Non-Resident
- ✓ Multiple properties or investment types
- ✓ Additional advisory support as needed
What's included
Our AI gathers your information, spots missing data, and drafts your return, faster and more accurately than forms alone.
A licensed CPA (US) or qualified accountant (UK) reviews every return before it's filed. No AI-only filings.
No hidden fees. The price you see is what you pay, including all forms covered by your package.
[INSERT: customer testimonial, e.g. "financial analyst in London, UK, saved money and stress using Nomadic.Tax"]
- financial analyst, London, UK
Frequently asked questions about US Taxes for Americans Living in the United Kingdom
Do I owe both US and UK taxes?
You will certainly file in both countries, but the US-UK tax treaty and the Foreign Tax Credit typically prevent double taxation. UK taxes paid are generally credited against your US liability dollar-for-dollar. Many Americans in the UK end up owing zero additional US tax after the FTC is applied.
Should I use FEIE or the Foreign Tax Credit for UK-source income?
For most Americans in the UK, the Foreign Tax Credit is more advantageous than FEIE, because UK tax rates are generally at or above US rates. Using FEIE in a high-tax country like the UK can actually backfire in some situations. We model both options for your specific income level.
I'm moving to the UK mid-year, what happens to my taxes?
The UK has split-year treatment rules that determine which part of the year you're treated as UK-resident. On the US side, there are no split-year rules, you remain a US taxpayer for the full year. We coordinate both returns to avoid gaps and overlaps.
Do I need to register for UK Self Assessment?
If you have income beyond PAYE (self-employment, rental income, foreign income, or income over £100,000), you'll need to file a UK Self Assessment return. Even some employed Americans in the UK need to file to claim treaty benefits properly.
Related tax guides
Why FTC is almost always better than FEIE for Americans in the high-tax UK, and the 5-year trap to avoid.
UK bank accounts, ISAs, and SIPPs all count toward your FBAR threshold.
How HMRC's Self Assessment works for Americans in the UK, SA109 non-resident pages explained.