calling UK tax folks

There is always Lotto.......   You will win.....I'm sure of it!! 

I've been transferring lots of $ to £ recently taking advantage of the good exchange rates for both living expenses and our plan to buy a house . (We have had an offer accepted but are still months away from completion, but exchange rates can swamp any loss in better returns). 

For example, if you compare $50,000 at an exchange rate of 1.5 (~last year's average) compared to a rate of 1.3.  That is a difference of £5,128 so you would need to be earning ~10% more in the USA compared to the UK.  Of course the exchange rates could drop further rather than go up....

Ah, so maybe my question wasn't so silly after all.  I wondered if I was missing something available here but, as I am a year and a half older than you are, I don't think the ISA world works for me either.

Oh yeah... and that second FLR-M is due in just under a year - oh joy!   

I'm 61, wife will be 61 next month and we are both maxing out our ISA's.  I don't think there is an age limit, and no minimum time to hold it for, it can be withdrawn the same year.  (I'm talking cash ISA's for us)

http://www.moneysavingexpert.com/savings/ISA-guide-savings-without-tax

In case anybody knows this.......when the rules say "when you turn 59 1/2".....does that mean I can immediately sell my ROTH after 3 January which is exactly on the half year, or do you have to wait until the end of the month or some such thing?

I think the official date would be a day before 6 months after your birthday......but I'd probably wait a couple of weeks passed that to be on the safe side.

I'm 61, wife will be 61 next month and we are both maxing out our ISA's.  I don't think there is an age limit, and no minimum time to hold it for, it can be withdrawn the same year.  (I'm talking cash ISA's for us)

http://www.moneysavingexpert.com/savings/ISA-guide-savings-without-tax

Good point about the amount of money the advantageous exchange rate can yield.  I hate to think about how much more I could have gotten from the $100,000 I transferred here in March 2015.... but it was so much worse the year before, and it's best not to dwell on crazy making things like that - too much like gambling. 

Thanks for the link about ISA's.   

I was under the impression ISA's weren't possible for me as a retired USC who has never worked here in the UK - something I'd best look into I suppose. 

It's strange what my brain does whenever I look at any tax/financial type stuff.... goes all fuzzy like. 

It's strange what my brain does whenever I look at any tax/financial type stuff.... goes all fuzzy like. 

Yep.......that's me. Some people can remember all the details.....I can't. That's one of the reasons I have been trying to simplify things. I think I finally have a good idea of how things should work out.....but it's taken a while.

Good point about the amount of money the advantageous exchange rate can yield.  I hate to think about how much more I could have gotten from the $100,000 I transferred here in March 2015.... but it was so much worse the year before, and it's best not to dwell on crazy making things like that - too much like gambling. 

Thanks for the link about ISA's.   

I was under the impression ISA's weren't possible for me as a retired USC who has never worked here in the UK - something I'd best look into I suppose. 

It's strange what my brain does whenever I look at any tax/financial type stuff.... goes all fuzzy like. 

There's nothing wrong with an ISA, it's the investments within the ISA that can be toxic to US citizens. You must avoid investment funds like unit trusts etc. You'd be ok owning individual stocks and bonds or a cash ISA, however, you'll have to pay US tax on any gains so you need to keep good records and be comfortable with some basic accounting and the tax treaty.

Apologies, but another long one.

On the thread topic:

I was on the phone,  again,  today to HMRC with a problem generated,  again,  by foreign pensions. I can report the gent I talked to completely understood the problem,  was most knowledgeable concerning the problem, courteous, very helpful, patient, and went to great lengths to make sure both he and I were fully cognisant of each others concerns and viewpoints. The problem, as always, was due to HMRC computer programmes.  All in all, once again, a pleasant conversation with HMRC. The subject was double taxation on income BY HMRC (nothing to do with US or other countries tax).

Now the rant. If I hear one more time, either on this site or BE, the words " It's simple, just file the forms once a year, there's nothing more to it" especially by those who have yet to be totally immersed in completing UK returns concerning foreign pensions, I'm going to SCREAM!

Sorry about that. Some may not have any reporting problems, but others may.

Constant vigilance is required. My HMRC gent immediately (and on several different occasions) acknowledged the problem was due to HMRC computer programmes. Today, I received my self assessment tax calculation. After carefully reading the documents, and an additional letter from HMRC, I discovered one small sentence on the opening page which would have resulted in double taxation of the same income by HMRC with a tax hit of roughly £2,000. It had nothing to do with the calculations of my 2015/16 return. In time, it would have evened itself out as for both HMRC and myself, but would have caused an extreme amount of unnecessary confusion for my US tax return. In all fairness, the US return would eventually come right, but I would not enjoy filing amended tax returns every year. For those of us not in the compliance industry, there are better ways to spend the time.

Also, and without discovering the problem and taking the action I took today, the problem with HMRC could have become even more difficult thanks to the current turmoil in exchange rates. (Some of the pros may now begin to recognise what the problem was).

All of this long winded diatribe is a way to get to Becca's question.

Exchange rates are a constant PITA. Everyone has to learn to live with them and realise they have no control over them. Sometimes you win, sometimes you lose.

My only suggestion would be the following: if you know you are going to return to the US eventually, make your primary plans in $US. IF you know you will spend the rest of your life in the UK, then make all your primary planning in £s. Due to cross country pensions, etc. one may always be subject to currency conundrums, as well as US tax exchange rate driven problems. But, IMHO, your savings plans should be centred on the country where you intend to live the final segment of your life. Great savings rates in the US mean nothing if when transferring the funds where needed results in an exchange rate at the time which totally obliterates the extra earnings made. Saving an additional $10,000 in the US may result in a loss if the exchange varies sufficiently at the time it is transferred. Moving assets when rates are advantageous is always a good plan, but in the end, there's nothing one can do in 'predicting' when the correct time to transfer will be at its best.