Moving to the UK Mid year

I'm a 28 year old dual US/UK citizen (born in the UK, received US citizenship when my parents went through the process when I was young) currently living in the US, and I hold both a US and UK passport (both brand new, expire 10 years from now). I'm wondering what my tax situation will be when I file next year. I'll give a quick breakdown of what I believe my life will be like for the rest of 2016.

1. Quitting my job in April to spend two months bumming around the US. I will have made about $15,000 pre tax at my current job by the time I quit
2. July 1st, 2016 - last day in the US, flying to Gatwick. I will have $19,000 in savings that I'll be bringing with me, planning on opening a Lloyds bank checking/savings account (they have a set up that allows people who have just arrived to open up a bank account without proof of residence). I think I may keep <$3000 in my US bank account so my student loans keeping pulling from that (unless that would make my tax situation more complicated).
3. First few weeks will be spend in the UK, visiting relatives.
4. Going on a 4-6 month backpacking trip of Europe/South East Asia. During this time I suspect I will earn 2-4000 Euros doing odd freelance web design work that I will have deposited into my UK bank account.
5. Return to the UK to settle down and find a permanent job, probably in November/December, with no plans to move back to the US. At most I might make about 5,000 pounds in the UK at the end of the year.
6. The money I have in my bank account is my only assets, I dont have any other sort of income.


Hopefully thats enough information that someone will be able to answer a couple questions I have.

1. How far out can I push filing my US tax return to be able to claim the bonafide residence test? My last day in US soil will be July 1st, 2015, and I dont think I'll be visiting the US before July 1st, 2016.
2. Other than filing my standard US tax return, is there anything else I need to file? I've been reading other forum posts and people are mentioning a foreign bank account form?
3. Will I have any issues with the Affordable Healthcare Act since I wont have any US health care from July 1st on wards (I will have a National Insurance Number and UK healthcare). If I wait to file my 2015 US return until I qualify for the residence test, will I skip any of the fees associated with not having health insurance?
4. Will it make my tax situation more complicated to keep money in my current US bank account to keep paying my monthly student loan payments? Or would it be easier come tax time if everything is UK based?
5. Other than these issues, are there any other surprises I haven't come across yet that I should know about?


The tax system in the US is insane, and people wonder why I'm moving.

I appreciate any and all help

The tax system in the US is insane, and people wonder why I'm moving.

I appreciate any and all help

I'll think about your questions a little later on, but my most obvious comment is that by moving to the UK you have done nothing to simplify your US taxes. You will have to file just like you did in the US, with the added complications of accounting for foreign income and also dealing with UK tax.

I'll think about your questions a little later on, but my most obvious comment is that by moving to the UK you have done nothing to simplify your US taxes. You will have to file just like you did in the US, with the added complications of accounting for foreign income and also dealing with UK tax.

It was a joke, I'm not moving because of taxes Thanks for the help!

1. How far out can I push filing my US tax return to be able to claim the bonafide residence test? My last day in US soil will be July 1st, 2015, and I dont think I'll be visiting the US before July 1st, 2016.

You get an automatic two month extension as a US citizen living abroad, but you can apply for up to six months.

https://www.irs.gov/pub/irs-pdf/f4868.pdf

2. Other than filing my standard US tax return, is there anything else I need to file? I've been reading other forum posts and people are mentioning a foreign bank account form?

If you hold foreign accounts you might have to file FBAR and 8938 forms. There are also other foreign forms that sometime crop up, but any good tax software package will let you know if you have to file those.

3. Will I have any issues with the Affordable Healthcare Act since I wont have any US health care from July 1st on wards (I will have a National Insurance Number and UK healthcare). If I wait to file my 2015 US return until I qualify for the residence test, will I skip any of the fees associated with not having health insurance?

The ACA is not applicable to US citizens that meet the overseas bona fide residence or physical presence tests.

4. Will it make my tax situation more complicated to keep money in my current US bank account to keep paying my monthly student loan payments? Or would it be easier come tax time if everything is UK based?

If it's just a checking account there should be no issues.

5. Other than these issues, are there any other surprises I haven't come across yet that I should know about?

Almost certainly, if you are self-employed outside the US make sure you understand the issues with self employment taxation like FICA and NI. Also make sure you actually qualify as being UK resident and eligible for the NHS before you take off for an extended vacation.

On the first point about the extension for filing - there is actually a specific extension available for those that won't have met the Bona Fide Residence test until after the 'usual' extended deadline of 15 October.   So in this case, you won't meet the BFR test for 2016 until you have spent the full 2017 calendar year with a tax home outside of the US (though you would possibly meet the Physical Presence Test earlier).   If relying on the BFR test, you won't be able to file your 2016 return and claim BFR until 1 January 2017, so this extension is specifically for people in that situation.

The extension form is a 2350 and may be found here https://www.irs.gov/uac/About-Form-2350

On the first point about the extension for filing - there is actually a specific extension available for those that won't have met the Bona Fide Residence test until after the 'usual' extended deadline of 15 October.   So in this case, you won't meet the BFR test for 2016 until you have spent the full 2017 calendar year with a tax home outside of the US (though you would possibly meet the Physical Presence Test earlier).   If relying on the BFR test, you won't be able to file your 2016 return and claim BFR until 1 January 2017, so this extension is specifically for people in that situation.

The extension form is a 2350 and may be found here newcomer link: https://www.irs.gov/uac/About-Form-2350 [nonactive]

I'd be able to qualify for the physical presence test if I extend to Oct 15th 2017, right? I don't plan on visiting the US in that time, and if I do, not more than a week or so.

Thanks to everyone for their help.

Yep, if you will meet the Physical Presence Test by 15 October then the 'standard' extension will cover you.

I'm very confused.  When you mention a Physical Presence Test, is that a specific form?  Does that automatically occur due to having a foreign address?  I use my old HR Block preparer in the states for my US taxes.  I've told her I have to file so that they know I'm outside the country but have no income as I'm a housewife.  Is there a specific form I should request that she file?

Thanks!