# American living in the UK, working for US company



## leom (Oct 18, 2012)

Hi everyone -

I've recently moved to the UK from New York, which is awesome. Which isn't so awesome is that I'm looking to continue working for my NY based company as an overseas contractor. From what I've gathered I need to setup a limited company and bill them through that, but aside from that detail I don't know what else to do (or if that's even right). As you might expect, I want to ensure I'm correctly paying my taxes in both countries.

Any advice (and more importantly a reference for a CPA qualified in US and UK taxes) would be greatly appreciated.

Thanks,


----------



## Bevdeforges (Nov 16, 2007)

What your tax obligations are for the US will depend on how long you're planning on staying in the UK (or outside the US anywhere). The FEIE won't help you until you have been outside the US for 12 consecutive months, or for an entire calendar year, depending on how you want to do things.

But as far as finding a tax adviser - let me suggest looking into an Enrolled Agent rather than a CPA (or CA, as they're called in the US). NAEA | Powering America's Tax Experts is the website for the Enrolled Agent professional association. At the top of the page, there is a link for "Find an EA" and they have a few EA's in the UK who are also UK accountants.

The site explains the EA qualification - and many EAs outside the US combine local and US tax knowledge and experience.
Cheers,
Bev


----------



## leom (Oct 18, 2012)

Fantastic, thank you very much Bevdeforges!

I'm planning to stay in the UK indefinitely (as I've recently gotten married) so it's good to know the FEIE won't help me just yet.


----------



## Bevdeforges (Nov 16, 2007)

Don't write off the FEIE just yet. Normally (and this is explained in Pub 54, which you can download from the IRS website), your first year outside the US, you simply file extensions for that year's tax returns until you hit the one-year anniversary of your arrival in the UK (or wherever).
Cheers,
Bev


----------



## BBCWatcher (Dec 28, 2012)

I would point out that the tax rate in the U.K. is often higher, with a top marginal rate of 45% (and a 40% rate that kicks in at a fairly modest amount of income), so it may be better to take the Foreign Tax Credit for everything instead of using the Foreign Earned Income Exclusion/Foreign Housing Exclusion. The pure FTC approach might make it easier to put money in a U.S. Roth IRA account, for example, and I suspect (though haven't verified) that gains to a U.S. Roth IRA could be shielded from both U.S. and U.K. taxes through the U.S./U.K. tax treaty.

I know the FEIE is popular, but that doesn't mean one should automatically assume it's best. "It depends."


----------

