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Topic: I'm so confused..  (Read 1266 times)

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I'm so confused..
« on: December 16, 2005, 01:25:58 PM »
I'm from the states, but I just married my husband and am living with him in England. I just got my new, shiny FLR visa in the mail yesterday.  I know this means that I can now work in the uk, but what confuses me is the whole issue about taxes.  I have so many questions about what happens next, so I thought I might ask some people who have been there and done that.  Forgive me if some of these questions have been asked before.  I've tried looking them up, but I just don't understand.

1) If you are working in the uk are you required to pay taxes in the US?

2) If you do have to pay taxes in both, how do you go about doing it? 

3) Are there special forms to fill out?

4) Now that I'm married, how do I change my name on my SS card?

That's all the questions I have at the moment.


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Re: I'm so confused..
« Reply #1 on: December 16, 2005, 11:22:28 PM »
1) As a US citizen you are required to file annually in the US.  If your earned income is below $80,000 a year you can file form 2555 claiming exclusion from US taxes each year.

2) You file annually in the US just as if you live there.  In the UK only about a third of the population need to file because the PAYE system takes care of withholding.

3) You need to fill out a form P86 in the UK, and forms 2555 and TDF90-22.1 in the US.

4) Look at the US Embassy website in London.  It has the answer!


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Re: I'm so confused..
« Reply #2 on: December 16, 2005, 11:41:50 PM »
Be careful in trusting the PAYE system if you only work a partial year.  PAYE assumes you get paid the same amount every month for the entire year.  My wife was due a big fat return because she started working in September but the Inland Revenue assumed she worked a full year from April to March (UK tax year).

Here's a simple example, say you made 1,000/month for 4 months the Inland Revenue assumes you worked a full year at that pay level and therefore calculates your tax on an annual income of 12,000 (1,312 in annual tax or 109/month).  However, in reality you only made 4,000 which is beneath the personal allowance of 4,895 and you actually owe no taxes.


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Re: I'm so confused..
« Reply #3 on: December 22, 2005, 02:57:45 PM »
I know this is late in replying, but thank you for the all the help.  I'm a little less confused now. 


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