Living part-time in the US and part-time in the UK?

I have lived in worked in the UK for 20 years (dual citizen) but as my mother in the US is getting older, I want to find a way to be able to split my time between the US and the UK in the most (legally) tax-efficient way.

I work for myself and can work from anywhere so I have the flexibility to "design" this in a way that works best. By that I mean, I can do whatever is required to make one of these locations my official tax home because I am not bound by a company, contract or length of time in either location.

I could continue working for myself in the UK as I am now (running my own UK limited company) - OR - I could also accept an offer (currently on the table) to work remotely for a US company remotely but as their employee (and close my UK company).

I'd love to hear any thought or advice on this - particularly from anyone who has had experience with doing this themselves.

Thanks in advance!

As a USC you are taxed on your worldwide income regardless of where you live but as a UKC you are not taxed at all if you live in another country. However, I don’t know how the UK would tax a person living in the USA while owning and running a UK business

I would personally keep it simple and work for a US company while living in the USA. I would also set up to pay class 2 NI contributions while working in the USA. Super cheap, great value.

Thanks for that.

So if both countries consider you a resident if you’re present for 183 days or more …Is it safe to assume if spend 183 days in the US and 182 in the UK, that would put me in the clear to make the US my official tax home? And does that mean I forfeit my ‘Bonafide resident’ status and start again from zero if I decide to ever move back to the UK full time and need to claim a tax credit?


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Thanks for that.

So if both countries consider you a resident if you’re present for 183 days or more …Is it safe to assume if spend 183 days in the US and 182 in the UK, that would put me in the clear to make the US my official tax home? And does that mean I forfeit my ‘Bonafide resident’ status and start again from zero if I decide to ever move back to the UK full time and need to claim a tax credit?


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No, that’s not a good assumption. You have to be able to prove in which country you have more financial and family ties, as per the UK Statutory Residence Test. I think that if you are not tax resident in the UK then you will lose access to some of the things that taxes pay for such as the NHS, the right to benefits etc.

https://www.gov.uk/government/publications/rdr3-statutory-residence-test-srt/guidance-note-for-statutory-residence-test-srt-rdr3

I think that you'll find this is not a simple area and just spending 182 days in the UK in a year won't cut it. I suspect that you'll find you will actually have 2 tax residencies. The tax treaty (UK/US) will potentially help you with some of your tax burden.

The following may be worth reading and digesting:

https://www.gov.uk/government/publications/dual-residents-hs302-self-assessment-helpsheet

When it comes to Uncle Sam and the IRS, well that may be a different story!