US Expat Taxes in the UK: What Americans Living in Britain Must File and How to Avoid Double Tax

As a US citizen you file a US federal return every year your income reaches the filing threshold, wherever you live. Moving to Britain does not end that. The UK then taxes you as a resident on top of it, so the same salary, interest and gains are reported to two tax authorities.

You report the same income twice, but you are not meant to be taxed on it twice. Either the Foreign Tax Credit sets the UK tax you have already paid against your US bill, or the Foreign Earned Income Exclusion leaves your UK earnings out of US tax. You use one or the other on the same income.

Once your UK bank, ISA and pension accounts pass $10,000 combined at any point in the year, you file an FBAR, a report of foreign accounts that goes to FinCEN rather than the IRS. Above that threshold, you need to file Form 8938. However, most of the time expats are confused if they need to file in both countries or not.

This guide covers what you file in each country, which relief stops the double tax, how UK accounts, ISAs and pensions are reported, the deadlines on both sides, and what changes on your first US return after the move.

US and UK taxes at a glance for Americans in the UK

The US taxes you because you are a citizen; the UK taxes you because you live there. The two systems run on different tax years, different returns and different deadlines, and only the US asks you to report your accounts in the other country.

The two things that decide most cases are which double-tax relief route you use and what you have to report about your accounts.

Do you still have to file US taxes if you live in the UK?

Yes. The US taxes its citizens on worldwide income wherever they live, so moving to the UK does not end your US filing. You file Form 1040 for every year your gross income reaches the filing threshold, even when the Foreign Tax Credit or the exclusion brings your US tax down to zero.

Your worldwide income means everything, not just what you earn in Britain: UK salary, UK interest, UK dividends and UK gains all go on the return, converted into US dollars. According to the IRS, the filing rules for citizens living abroad are generally the same as the rules for citizens living in the US. Nothing you do on the UK side removes the obligation, and that includes the 4-year FIG regime, which changes your UK tax only.

The income levels that trigger a US return

Your filing status sets the threshold, and for most people it is the same figure as the standard deduction. These amounts are for filers under 65.

Two things catch people out. Net self-employment earnings of $400 or more mean you file whatever your gross income is, and UK earnings that you exclude under the Foreign Earned Income Exclusion still count towards the gross income test, so an excluded salary can be the very thing that puts you over the threshold. The 2026 amounts are the inflation-adjusted figures the IRS published for that tax year.

Dual US-UK citizens and green card holders

Taking British citizenship does not remove US filing. A dual US-UK citizen is still a US citizen for tax purposes and files on the same basis as anyone else reading this page. A green card holder is a US resident alien and is also taxed on worldwide income, so the same return, the same thresholds and the same account reporting apply.

One warning for green card holders only: a long-term green card holder who claims to be a UK resident under the treaty tie-breaker can be treated as having expatriated, with the tax consequences that follow.

Do you also have to file a UK tax return?

The UK taxes you by residence, not citizenship. Once you are UK resident under the Statutory Residence Test you pay UK tax on your worldwide income, usually through PAYE. You need a Self Assessment return only if you have income that PAYE does not cover, or HMRC asks you for one.

When you become UK tax resident

You are automatically UK resident for a tax year if any one of three tests is met. You spent 183 days or more in the UK in that tax year; or your only home was in the UK for a period of 91 days or more in a row and you stayed in it on at least 30 days of the tax year; or you worked full-time in the UK for any 365-day period that includes at least one day of the tax year.

If none of those applies, you can still be resident under the sufficient ties test, which weighs the number of days you spent here against your connections to the UK, such as family, accommodation and work.

The year you arrive is treated differently again. Split-year treatment can divide that tax year into a non-resident part and a resident part, so the UK taxes you as a resident only from the point you arrive rather than for the whole year, as GOV.UK explains.

Residence is decided tax year by tax year, 6 April to 5 April, so the answer can change from one year to the next.

How much UK income tax you pay

These are the UK income tax bands for 2026-27 in England, Wales and Northern Ireland.

The Personal Allowance falls by £1 for every £2 of adjusted net income above £100,000, so it runs out entirely at £125,140. Scotland sets its own bands and rates for income other than savings and dividend income.

Those rates matter for your US return as well. UK tax on a salary is usually heavier than US tax on the same salary, which is why the Foreign Tax Credit normally covers the US tax on your UK earnings in full.

When you need a Self Assessment return

If your only income is a PAYE salary, you usually do not file a UK return at all. You file when you have income that PAYE cannot collect: self-employment income over £1,000, rental income, untaxed savings interest, dividends, or foreign income, which for an American often means US interest and US dividends.

The dates are fixed. For the 2025-26 UK tax year you register for Self Assessment by 5 October 2026, file a paper return by 31 October 2026, and file online and pay by 31 January 2027, according to GOV.UK.

The 4-year FIG regime changes your UK tax, not your US return

The 4-year foreign income and gains regime can take your non-UK income out of UK tax for your first four years of UK residence. It replaced the remittance basis from 6 April 2025 and is open to you if you were not UK resident for the previous 10 tax years. The conditions are set out in HMRC's guidance on the regime.

It covers foreign income and gains such as non-UK dividends, interest and capital gains, but not foreign employment income. Claiming it costs you the Personal Allowance and the capital gains annual exempt amount for that year.

Which US forms do Americans in the UK file?

Every American in the UK above the threshold files Form 1040; most add Form 1116 or Form 2555 to deal with double tax, and anyone with UK accounts over $10,000 in total files an FBAR. Which of the rest you file depends on what you own.

The FBAR is the odd one out. It goes to FinCEN through the BSA E-Filing System, the Treasury's own electronic filing portal, rather than to the IRS with your return, a distinction the IRS sets out in its comparison of Form 8938 and FBAR requirements.

On the UK side the paperwork is shorter: the SA100 return, with the SA106 foreign pages and the SA109 residence pages where they apply.

How do you avoid being taxed twice on the same income?

Usually you are not. You either use the UK tax you have already paid as a Foreign Tax Credit against your US tax, or you exclude up to $132,900 of 2026 UK earnings with the Foreign Earned Income Exclusion. You cannot do both with the same income.

Because UK income tax on a salary is usually higher than US tax on the same salary, the credit generally brings your US tax on UK earnings to zero and leaves unused credit to carry forward. The two routes are not equally good, though, and the better one depends on what your income is made of.

The Foreign Tax Credit: using the UK tax you have already paid

The credit gives you a dollar of US tax relief for the UK income tax you paid or accrued on the same foreign income. It is capped at the US tax on that income, so it can take your US bill on your UK salary to zero but never refunds UK tax.

Anything above the cap is not lost. Unused credit carries back one year and forward ten, which is how most Americans in the UK build up a reserve of credit for a year with less UK tax.

The credit also reaches income the exclusion cannot touch, including UK interest, dividends and capital gains, as the IRS sets out. You claim it on Form 1116.

The Foreign Earned Income Exclusion: leaving UK earnings out of US tax

The exclusion removes up to $130,000 of 2025 earnings, or $132,900 of 2026 earnings, from your US taxable income, per qualifying person. It works on earned income only: wages, salary and self-employment income. UK interest, dividends, capital gains and pension income stay fully taxable on your US return. A separate housing exclusion or deduction can cover part of your UK rent or housing costs on top.

You qualify under one of two tests. The bona fide residence test asks whether you have been a resident of a foreign country for an uninterrupted period that includes a whole tax year. The physical presence test asks whether you were in a foreign country for 330 full days in any 12 consecutive months, which the IRS treats as the mechanical alternative.

Which one usually works better in the UK

The exclusion can still suit lower earners, or someone with little UK tax to credit, and the choice is worth modelling with your own figures before you make it.

What the US-UK tax treaty does and does not change

The treaty does not stop the US taxing you. Article 1(4) of the 2001 Convention, the saving clause, lets the US tax its own citizens as if the treaty did not exist, apart from a list of exceptions in Article 1(5). Those exceptions are where the treaty still helps an American in the UK, most often with pensions, which Articles 17 and 18 deal with, as the IRS's treaty documents show.

When you do rely on a treaty position to change how income is taxed, you disclose it on Form 8833.

How do you report UK bank accounts, ISAs and pensions?

UK accounts are foreign accounts for US purposes. If they total more than $10,000 at any point in the year you file an FBAR, and above much higher thresholds you also file Form 8938. An ISA is not tax-free on your US return, and UK funds held in or out of an ISA are usually PFICs.

This is where most Americans in the UK get caught out, because none of it depends on owing US tax. The reporting applies even in a year when the Foreign Tax Credit takes your US bill to zero.

FBAR and Form 8938 thresholds for people living in the UK

Two separate reports, two different thresholds.

The higher Form 8938 thresholds apply because you live abroad. For this purpose that means you are a bona fide resident of a foreign country for an uninterrupted period including the whole tax year, or you were present in a foreign country for at least 330 full days in a 12-month period ending in the tax year, as the Form 8938 instructions set out.

When you add up the FBAR total, count everything: current accounts, savings accounts, ISAs and many pension accounts all go into the same $10,000 figure, and once you cross it you list every account, not only the large ones.

ISAs are not tax-free on your US return

An ISA's UK tax-free status stops at the UK border. Nothing in the US-UK treaty exempts ISA interest, dividends or gains from US tax, so they are reported on Form 1040 like any other income. Cash ISA interest is simply US taxable interest. A stocks and shares ISA is worse: it is a reportable foreign account in its own right, and the funds held inside it are tested separately under the PFIC rules.

UK funds and the PFIC rules

A passive foreign investment company is a foreign corporation that makes most of its money from investments rather than from trading, and UK-domiciled funds commonly meet that test. The test is 75% or more passive income, such as interest and dividends, or 50% or more passive assets.

Holding one costs you in two ways. You file Form 8621 every year, one for each holding, and the US taxes the fund less favourably than it would tax the same money held in a US fund.

UK workplace and personal pensions

Your UK pension accounts are generally reported on the FBAR and, above the thresholds, on Form 8938. How the US taxes the contributions, the growth inside the scheme and the withdrawals depends on the treaty's pension articles. Those articles are among the provisions a US citizen can still use despite the saving clause, so the answer varies with the type of scheme you are in.

The 25% UK tax-free lump sum is the point to watch. It is tax-free in the UK, and that does not make it automatically tax-free in the US.

What are the deadlines, and in which order should you file?

Your 2026 US return is due 15 June 2027 if you live in the UK, but any US tax you owe must be paid by 15 April 2027. Because the UK tax year ends on 5 April, the UK return covering most of 2026 is not due until 31 January 2028. Most Americans in the UK therefore file the US return from payslips and estimates rather than waiting for the UK return to be finished.

US and UK deadlines for 2026 and 2026-27

The 15 June date is an automatic two-month extension. It applies to a citizen whose tax home and abode are outside the US on the regular due date, and you attach a statement explaining the qualifying situation. Interest still runs from 15 April on anything you have not paid, as the IRS sets out.

Form 4868, filed by the June date, moves the filing date to 15 October, but it gives you no extra time to pay. The further extension to 15 December is discretionary, is requested by letter before the October date, and is closed to anyone who already has a Form 2350 extension.

The FBAR extension to 15 October works differently from all of these: it is automatic, and there is nothing to apply for.

Why the US and UK tax years do not line up

Your US tax year 2026 sits across two UK tax years. January to 5 April 2026 falls in UK 2025-26, and 6 April to December 2026 falls in UK 2026-27. No single UK return matches a single US return, which is why the two sets of figures never arrive in a convenient order.

In practice, work out your US tax first and pay anything owed by 15 April 2027. For the UK tax that sits behind your Foreign Tax Credit, use your 2025-26 UK figures for January to 5 April 2026, and payslips or a reasonable estimate for 6 April to 31 December 2026.

If the final UK figure turns out to be materially different from the estimate, amend the US return.

How do you file and pay US tax from the UK?

You can e-file a US return with a UK address, and you can pay the IRS without a US bank account, but two of the IRS's own payment tools need one, so decide your payment route before 15 April. Filing itself is the easy part: a Form 1040 with a foreign address can go through IRS Free File where you are eligible, through commercial software, or through a tax professional, as Publication 54 confirms.

Paying takes more planning. IRS Direct Pay and EFTPS both require a US bank account, which many Americans in the UK closed years ago. If that describes you, the IRS lists foreign electronic payment options instead, including a same-day international wire and debit or credit card payments through IRS-authorised processors. A wire from a UK bank takes time to arrive, so start it well before the payment date rather than on it.

Everything on the return goes in US dollars, so your pounds have to be converted. You can use the IRS yearly average exchange rate for amounts you received through the year, or the spot rate on the date of each transaction, as long as you apply your choice consistently. The payment date itself is in the deadlines table above.

What changes on your first US return after moving to the UK?

Nothing about who files changes. As a US citizen you report the whole calendar year's worldwide income, before and after the move, because there is no US split year for citizens. What changes is the paperwork: the UK income, your first FBAR, and a choice about whether to wait until you qualify for the exclusion or use the Foreign Tax Credit straight away.

Four things are new in that first year:

• Your US return covers the whole calendar year, including the months before you left.
• You file your first FBAR if your UK accounts pass $10,000 at any point.
• You decide between claiming the Foreign Tax Credit now and waiting until you qualify for the exclusion.
• On the UK side, split-year treatment and the 4-year FIG regime may both be open to you.

Planning points before and during the move

• Review your US brokerage and retirement accounts before UK residence starts.
• Think about the PFIC rules before you buy any UK funds.
• Check how your US state treats you after you leave, which the state tax section below covers.

Social Security and National Insurance: which do you pay?

Usually only one. The US-UK Social Security agreement assigns most workers to a single system, so you are not meant to be paying into both at once. If you are employed by a UK employer and working in the UK, you normally pay UK National Insurance only and nothing to US Social Security.

The main exception is a posting. A worker sent to the UK by a US employer for five years or less stays covered by US Social Security alone, according to the Social Security Administration. If you are self-employed, you are normally covered by the country you live in, which for an American resident in Britain means the UK system.

Whichever country keeps your coverage issues a certificate of coverage, and that certificate is what shows the other country that you are exempt from its contributions.

The agreement matters on your US return as well as your payslip: the Foreign Earned Income Exclusion does not reduce US self-employment tax, so for a self-employed American in the UK it is the agreement, not the exclusion, that keeps those contributions on one side of the Atlantic.

Do you still owe US state tax after moving to the UK?

Possibly. Each state sets its own residence rules, quite separately from your federal filing, and some states can keep treating you as a resident after you move abroad if your domicile or your ties remain there. California and New York are the two that catch Americans in the UK most often, because leaving the state is not the same thing as ending residence there.

The second trap is relief. A state return does not automatically give you the Foreign Earned Income Exclusion or the Foreign Tax Credit just because your federal return does; each state applies its own rules. So you can reach $0 of federal tax on your UK salary and still face a state bill on the same income.

What if you are behind on your US taxes?

There is a published route for Americans abroad whose failure to file was not wilful: the Streamlined Foreign Offshore Procedures. Under it you file the most recent three years of delinquent or amended returns with all the information returns that go with them, and the most recent six years of delinquent FBARs. You pay the tax and interest due, and you certify that your conduct was non-wilful on Form 14653. There is no miscellaneous offshore penalty.

To use the foreign version of the procedures as a US citizen, you have to meet a non-residency requirement: in at least one of the most recent three years you were physically outside the US for at least 330 full days and had no US abode in that year, as the IRS sets out for taxpayers residing outside the United States. Living in the UK for a few years will usually satisfy it, but it is a condition, not an assumption.

Which route fits you turns on whether the conduct was non-wilful, and that is a judgement worth making with advice before you file anything.

What are the most common mistakes Americans in the UK make?

Most problems are missed forms rather than extra tax. Americans in the UK assume UK rules carry over to their US return, or that one country's paperwork covers the other.

“PAYE already takes my UK tax, so I can stop filing in the US.” US filing follows citizenship, not where your tax is collected, so you file Form 1040 every year your gross income reaches the threshold. Stopping leaves you with unfiled years that have to be caught up later, usually through the Streamlined procedures.

“A UK fund is just a fund.” UK-domiciled funds commonly meet the PFIC test, inside an ISA as much as outside one. Buying one without checking creates an annual Form 8621 and a tax treatment that is worse than the same money held in a US fund.

“My ISA is tax-free, so it stays off my US return.” An ISA is tax-free under UK rules only; its interest, dividends and gains are US taxable income and go on Form 1040. Leaving them off understates your income and, for a stocks and shares ISA, usually means a missed Form 8621 as well.

“The exclusion is the obvious choice, so I will take it.” The exclusion leaves nothing behind, while the Foreign Tax Credit carries unused credit back one year and forward ten. Defaulting to Form 2555 in a high-UK-tax year throws away relief you could have used later, and costs you the additional child tax credit.

“I excluded my salary, so I can still credit the UK tax on it.” No credit is allowed for foreign tax on income you have excluded. Claiming both on the same earnings is a double claim that has to be unwound.

“My return is due 15 June, so my payment is too.” The June date extends the filing deadline only; US tax for 2026 is payable by 15 April 2027. Waiting until June means interest runs from April on whatever you owe.

“The treaty or the FIG regime takes me out of US tax.” The saving clause lets the US tax its citizens as though the treaty did not exist, and FIG changes your UK tax only. Relying on either can leave income with no UK tax paid on it and a full US bill on the same money.

Frequently asked questions

What to do next

Five actions, in order. Each one gives you what you need for the next.

1. List every UK and US account you hold, with its highest balance during the year and its balance on 31 December.
2. Work out whether your 2026 income reaches the US filing threshold for your filing status.
3. Decide between the Foreign Tax Credit and the exclusion, using your own UK tax figures.
4. Put 15 April 2027 in your diary for the US payment and the FBAR, and 15 June 2027 for the return.
5. Check the UK Self Assessment triggers against your income, together with the 31 January dates that go with them.

Taxule prepares US tax returns, FBAR and FATCA for Americans in the UK, including Form 8938, using the UK tax you have already paid.

If you have years you have not filed, start with the catch-up section above before you start on this year's return.