New Resident, Freelancer -How do I pay taxes??

Help needed!  Sorry I'm a mess...

I'm a dual US/UK citizen who recently moved here, and last year worked for the first time in the UK as a British Citizen.  I worked two freelance jobs, both paying about 7k which pushes me over the 10k tax exemption, but neither took any taxes out of my pay. 

Do I need to sign up as a business on HMRC?  Or how do I pay taxes on what I made over 10k?
Is there a deadline to pay those taxes for last year?
Will I get some form saying how much I was paid and paid in taxes? I need to start working on my US taxes and need to report what I earned and paid here!

THANKS FOR YOUR HELP!

I'd suggest you talk to an accountant to make sure your UK taxes are covered.  Seems like any neighborhood firm should be able to handle it.  They'll also get you set up correctly for future work

Jimbocz is right to recommend an accountant. But there are steps you should be taking yourself.

First, go here and read up: https://www.gov.uk/log-in-file-self-assessment-tax-return/if-youre-already-registered

Click on 'register if you're self-employed and follow the instructions under 'if you haven't sent a return before'. It is not advantageous at £14K to register and file as a limited company, so you will be a sole trader.

If this is for the 2016-17 tax year, you've got time to sort yourself out. Your online return for 1 April 2016-31 March 2017 (which is essentially how things are calculated for accounting purposes) is due 31 January 2018. You also must pay self-assessment tax and Class 2 and 4 NICs by this date. You might also have to pay a 'payment on account' towards the 2017-18 tax year by this date, depending on if you are continuing to work as a sole trader in the new tax year. (You may, of course, pay before then.)

Once you are registered on the HMRC site, you will be able to walk through the form, get the calculation, submit the self-assessment return, etc. I encourage you to do this before the 15 June US expat tax-filing deadline, so that you have proof to send to the IRS and can comply by getting the foreign earned income exclusion (FEIE). It will also help you decide if you want to pay for an accountant.

I can tell you how I do things as a sole trader, to give you a point of reference but you by no means have to follow my model. I know other sole-traders who operate completely differently.

1. I set aside a percentage of each payment I receive from a client, socking that money into an ISA so I don't have to pay tax on the money I'll use to pay tax.

2. I keep all my business receipts -- e.g. Adobe Creative Suite subscription, Microsoft Office subscription -- in a digital folder. Admittedly, I don't have very complicated expenses, so it's easy to keep track.

3. Come mid-April, I create a Google Drive for my accountant. Inside, she gets my income spreadsheet, so she can see exactly how much I've brought in over the course of the tax year. She also gets my various expense receipts in an organised manner.

4. By the end of April, she comes back with how much I'll owe, and the payments on my March invoices come in. She submits to HMRC on my behalf (there is an online mechanism through the HMRC site for approving someone to be able to do so). I pay her (£180).

5. When HMRC recognises that my return has been filed (mid-May to early-June-ish), I pay the tax due by 31 Jan. This is because I do not work in arrears, and have the money set aside already. I know other people who work in the new tax year to pay the bill due in January, and it seems to work for them mentally, so long as they pay by HMRC's deadline. This is not an approach that works with my psychology.

6. In early June, I fill in the IRS FEIE form and 1040 (this year will be for 2016 US tax year), ultimately owing nothing to the IRS. Post the forms before the 15 June deadline, et voila! Another expat freelancer tax year done and dusted.

6. In early June, I fill in the IRS FEIE form and 1040 (this year will be for 2016 US tax year), ultimately owing nothing to the IRS. Post the forms before the 15 June deadline, et voila! Another expat freelancer tax year done and dusted.

Since the tax years for the US and the UK are different, I assume that your US figures are based on your spreadsheet of UK income from January through December? And you also file the FinCen (FBAR) form online if your foreign accounts have ever had more than a certain amount of money in them, correct? (FYI, I believe it was £6,810 for 2015 and now it's £7,700 for 2016, based on IRS exchange rates.)

Sorry to ask what I suspect are dumb, obvious questions -- I'm doing this myself for the first time this year as a self-employed person and I'm pretty nervous to get it right. I already do/file my own UK taxes once my accountant approves the calculations and figures I show him.

Many thanks!

Thanks all for all your help. Yes, Minxy, I'm doing it off spreadsheet calculations. The way the tax years don't line up here and in the US is really annoying and half of my confusion.

Guess I need a London accountant to help me get signed up to pay taxes here. Even tho I made barely over the threshold for reporting.  Here goes!

As a freelancer you need to be tracking your expenses and income. You are responsible for your own payroll and income taxes. You will need to register with HMRC and do a self assessment. You will also need to file US federal taxes and fill out a Schedule C making sure you don't pay US self employment taxes as you are already paying UK National Insurance.

Since the tax years for the US and the UK are different, I assume that your US figures are based on your spreadsheet of UK income from January through December? And you also file the FinCen (FBAR) form online if your foreign accounts have ever had more than a certain amount of money in them, correct? (FYI, I believe it was £6,810 for 2015 and now it's £7,700 for 2016, based on IRS exchange rates.)

I just send off my UK return that I print from the HMRC site, as part of my packet to the IRS. They know that not every tax year lines up with theirs, which I reckon is part of why you get a two-month extension. Sending them a spreadsheet is going to be a lot less official anyway. I haven't received any angry letters in response to any of the three returns I've done, but the IRS isn't really interested in people like us, making 'normal' amounts of money.

I don't have any experience with FBAR, because I move money into my husband's accounts immediately. We specifically did not get him an ITIN, and he is just 'non-resident alien' on my tax returns. (In fact, that's a great pet name. Going to start using that.)

I just send off my UK return that I print from the HMRC site, as part of my packet to the IRS. They know that not every tax year lines up with theirs, which I reckon is part of why you get a two-month extension. Sending them a spreadsheet is going to be a lot less official anyway. I haven't received any angry letters in response to any of the three returns I've done, but the IRS isn't really interested in people like us, making 'normal' amounts of money.

I don't have any experience with FBAR, because I move money into my husband's accounts immediately. We specifically did not get him an ITIN, and he is just 'non-resident alien' on my tax returns. (In fact, that's a great pet name. Going to start using that.)

The US government stopped requiring that one attaches a copy of a foreign tax return back - I think - in the 1970s. Sending the UK return would be very peculiar  indeed. Many US citizens in the UK cannot use HMRCs free software because it does not support the Residence and Domicile pages.

Being practical, if you are s self-employed US person, you'll probably want to use 31 December as your accounting year-end for both US and UK tax purposes.

The US government stopped requiring that one attaches a copy of a foreign tax return back - I think - in the 1970s. Sending the UK return would be very peculiar  indeed. Many US citizens in the UK cannot use HMRCs free software because it does not support the Residence and Domicile pages.

Being practical, if you are s self-employed US person, you'll probably want to use 31 December as your accounting year-end for both US and UK tax purposes.

So I need to buy US accounting software and generate an official statement of account through that? I'm counting down the days until I can renounce, so I just want to do whatever will keep them off my back until then.

So I need to buy US accounting software and generate an official statement of account through that? I'm counting down the days until I can renounce, so I just want to do whatever will keep them off my back until then.

Sorry, but I'm lost now. A US person claiming the foreign tax credit attaches IRS Form 1116 each year to the return (in sequence number order) and claims foreign tax paid or accrued each year.

Records are kept because both the UK and the US require that one does so. The UK may insist that that these are kept these digitally under MTD from next year. The IRS require no more than the completion and filing of any applicable IRS forms each year.

Sorry, but I'm lost now. A US person claiming the foreign tax credit attaches IRS Form 1116 each year to the return (in sequence number order) and claims foreign tax paid or accrued each year.

Records are kept because both the UK and the US require that one does so. The UK may insist that that these are kept these digitally under MTD from next year. The IRS require no more than the completion and filing of any applicable IRS forms each year.

Yeah -- I do that form, and the 1040. But I don't have to send the IRS anything official? I just ... send off whatever numbers I come up with, and they're meant to believe me? I would never have guessed in a million years that the IRS would take my word for it.

And, yes, I'm fully compliant on all UK filing standards for sole traders.

Yeah -- I do that form, and the 1040. But I don't have to send the IRS anything official? I just ... send off whatever numbers I come up with, and they're meant to believe me? I would never have guessed in a million years that the IRS would take my word for it.

And, yes, I'm fully compliant on all UK filing standards for sole traders.

US law requires that one self-assesses. If you are completing all of the numerous annual US income tax and information returns correctly; including making any appropriate treaty elections; the IRS require no additional information is filed with them unless you are unlucky enough to have a return selected for audit.

The system is identical in the UK. Both are self-assessment systems where (currently) the taxpayer files completed government produced forms. The UK system will however be changing from next year, while self-assessment tax returns are gradually made obsolete, but the US has no such plans.

US law requires that one self-assesses. If you are completing all of the numerous annual US income tax and information returns correctly; including making any appropriate treaty elections; the IRS require no additional information is filed with them unless you are unlucky enough to have a return selected for audit.

Absolutely gobsmacked. Assumed I had to prove myself two times over, like when you arrive at the border and start having a nasty go, even though you've got the passport.