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Topic: UK PFIC like taxes?  (Read 520 times)

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UK PFIC like taxes?
« on: May 16, 2017, 05:39:46 PM »
I have a question regarding PFIC taxes.  I am an American by birth.  I have lived in the UK for 25+ years.  I recently streamlined 2013-2015 due to some PFIC issues I missed.   In my 2016 taxes, I chose to complete quite a few 8621 PFIC forms as I sold up several UK funds due to the low exchange rate...really don’t want to have to do that again.

I haven't explored the reverse side of this issue much.  Can anyone direct me to details of any UK PFIC-like taxes that are imposed by HMRC on funds American expats may hold that are not UK reporting but are US reporting.

Thanks.


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Re: UK PFIC like taxes?
« Reply #1 on: May 16, 2017, 06:07:35 PM »
The UK introduced OIG (Offshore Income Gain) rules in 1984. The United States introduced PFIC rules in 1986. Neither set of rules is new; if you were recommended to invest in either you might want to ask whoever recommended them why there were considered suitable.


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Re: UK PFIC like taxes?
« Reply #2 on: May 16, 2017, 08:15:22 PM »
Hi – Thanks guya for that quick reply.  I will have a good read of the UK OIG rules. 

Now that streamlining and my 2016 returns have covered my PFIC obligations due to my recent mass sell, I am deciding how to reinvest and taxation will form a large part of my choice.  My choice seems on balance to be either

a.)   Buy UK reporting/non US reporting and be hit with PFIC again.  Costs about £75 to £100 per 8621 plus tax rate of around 40% on top of around £1000 to prepare a standard 1040.

b.)   Buy US reporting/non UK reporting and be hit with OIGs.  I am currently looking into preparation costs for OIGs for my UK tax return. 

It would be nice if there was a reliable (c.) where we had a UK reporting/US reporting fund.  I see a thread on here suggests Vanguard ETFs but makes the good point that they may not always be dual reporting in the future.

If there is an option (d.), I would love to hear about it.


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Re: UK PFIC like taxes?
« Reply #3 on: May 17, 2017, 10:43:00 PM »
US Vanguard ETFs are you best option for pooled investments.....other that that I'd stick to interest accounts and individual securities.


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