At what point might we want a tax advisor?

What about UK citizens that pay via PAYE? Are they required to file a tax return as well?

Also, is there a certain date that the UK tax return is due? 

Do you know the name of the forms I need to submit?

Thank you!

Yael,

>> What about UK citizens that pay via PAYE? Are they required to file a tax return as well?

There are three circumstances under which you would either need to or want to file.  Read my post again.  That's your answer.

>>Also, is there a certain date that the UK tax return is due? 

Due 31 Jan 08.  If you have a refund, obviously file sooner.  If you owe, file 31 Dec 07, and then you will have more Foreign Tax Credits if you are using the paid method on your Form 1116 Foreign Tax Credit (on your US return).

>>Do you know the name of the forms I need to submit?

The form is a "Self Assessment" form, or SA, and found on the HMRC website.

What about UK citizens that pay via PAYE? Are they required to file a tax return as well?

Just my experience...

No one I know other than the self employed file tax returns.  There is certainly no obligation to do so, and if you have been in employment for the whole of the financial year and know that you have been paying the correct tax through PAYE then I can't see any point.

In the past when I have been without work for part of the financial year and have then been PAYE and have known that I have overpaid tax, a simple phone call to the tax office has got me my rebate.

I have now started filing my tax return, because o have gone self employed.

Also, my clients who are on work permits and are PAYE are not required to complete a self assessment form.

Vicky

Victoria - you were correct in the past but since 2005 the UK law changed so that one now has to claim annually to be taxable on the remittance basis.  Therefore, anyone who has any US source income or gains and has not filed a UK tax return making this claim could be "discovered" by HMRC to have failed to disclose sources of income.

Much better to my mind to file annually to avoid the possibility of a discovery notice from HMRC and to aid sleep knowing that everything is above board.  But as I said above, this is my preference.  Given that unless remittances are being made to the UK by withdrawing or spending dollars in the UK there will not normally be UK tax at stake many folks won't want to bother with the paperwork.

Victoria - you were correct in the past but since 2005 the UK law changed so that one now has to claim annually to be taxable on the remittance basis.  Therefore, anyone who has any US source income or gains and has not filed a UK tax return making this claim could be "discovered" by HMRC to have failed to disclose sources of income.

So, I would need to advise HMRC that I worked in the US during April and May 2006?

I'm just a bit confused because no one I know has ever heard of this and I couldn't find any information on the HMRC about this.  I guess its one of those hidden things.

Thanks for everyone's help.  I appreciate it.

Yael - you'd only have to report that income if you were not claiming the concessionary split-year basis in the year of arrival in the UK (assuming you arrived in the UK in May 2006); or alternatively if you were already UK resident by April 2006.

Your local HMRC office will have an enquiry counter where you can go for free advice if you find the UK taxsystem perplexing!

Victoria - you were correct in the past but since 2005 the UK law changed so that one now has to claim annually to be taxable on the remittance basis.  Therefore, anyone who has any US source income or gains and has not filed a UK tax return making this claim could be "discovered" by HMRC to have failed to disclose sources of income.

Much better to my mind to file annually to avoid the possibility of a discovery notice from HMRC and to aid sleep knowing that everything is above board.  But as I said above, this is my preference.  Given that unless remittances are being made to the UK by withdrawing or spending dollars in the UK there will not normally be UK tax at stake many folks won't want to bother with the paperwork.

So if my clients have any other source of income at any point in the financial year other than that which they get in the UK and on which they pay PAYE, I should advise that they complete a self assessment form?

Vicky

Yael - you'd only have to report that income if you were not claiming the concessionary split-year basis in the year of arrival in the UK (assuming you arrived in the UK in May 2006); or alternatively if you were already UK resident by April 2006.

Your local HMRC office will have an enquiry counter where you can go for free advice if you find the UK taxsystem perplexing!

Thanks, I get it now!   I think its probably best to file just to make sure I'm right.