# What are reasonable fees for US/UK tax help?



## LondonResident (Sep 27, 2013)

Hi everyone. I recently formed a UK limited company and I've been getting quotes for how much it will cost to file my US tax return (given form 5471 etc).

So far I've gotten quotes for £280 - £400 an hour for advice and £1400-£2000 for filing my US return. Does this seem normal? It seems really expensive to me and I'm not sure if I should get advice (I have a few specific questions) and share it with my accountant in the US and my accountant in the UK or just hire someone at that rate.

Thanks for your help.


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## Joppa (Sep 7, 2009)

Post on Expat Tax forum under General, but I believe you get free help from IRS attached to US embassy. Of course if your query is complicated, you need to get paid help.


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## LondonResident (Sep 27, 2013)

Thanks for your help. Is it possible to move this post there?


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## Bevdeforges (Nov 16, 2007)

Unfortunately, the IRS offices at the Consulate do not offer tax advice on "professional" taxes, only on personal taxes. Though you certainly have enough questions related to your personal returns.

The other option is to check into using an "Enrolled Agent" - a specialized tax professional certified by the IRS. There are a couple of enrolled agents in the UK, and a few in other European countries. NAEA | Powering America's Tax Experts is their professional association and if you click on Find an EA you can find the EAs in your country.

An EA is often a bit less expensive than a tax accountant, though some tax accountants are also EAs, so it varies.
Cheers,
Bev


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## LondonResident (Sep 27, 2013)

Hi Bev. Thanks for the link. I looked at the list of EAs in London and they are basically the same as those listed on the embassy website.

I'm really struggling with the fact that I need submit form 5471. I feel like a run-of-the-mill professional and don't understand why I need to pay so much to just submit *information*.

Are there any advocacy groups that try to lessen the burden on "normal" expats?


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## santafe (Sep 10, 2012)

We pay around €575, for 5471 prep but that is only for that form, I prepare the rest of the tax return myself and I do all the prep work for the 5471. The accounts have to be prepared according to US general accounting principles which are different to the UK rules, and all the the accounts must be prepared for the calendar year not your UK company tax year. The preparing of the accounts is time consuming, not the actual 5471 form. It may be worth paying for the first year and preparing them yourself in future. The 5471 form is also more complicated the first year as it includes info about who owns shares, etc , but subsequent years are more straight forward unless there are changes in share ownership. Also there is a issue with sub part F income which may or may not apply which is a complex area of this form, but our business does not generate this sort of income. 

We are a small software business, so it is pretty straightforward.


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## LondonResident (Sep 27, 2013)

Thanks, santafe. I'm a one-man IT consultant so I imagine it's straightforward for me as well. (I formed a company for the limited liability)

I've actually been wondering if I can fill out form 8832 and elect to be "A foreign eligible entity with a single owner electing to be disregarded as a separate entity". Would I still need to file form 5471? 

Separately I wonder if I could then pay myself using dividends and count the 20% UK corporation tax to my foreign tax credit (I don't know the legal jargon so pardon me if I'm stating things incorrectly).

This is specifically the advice I am seeking from the tax advisors over here: how do I pay myself?


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## Bevdeforges (Nov 16, 2007)

LondonResident said:


> Hi Bev. Thanks for the link. I looked at the list of EAs in London and they are basically the same as those listed on the embassy website.
> 
> I'm really struggling with the fact that I need submit form 5471. I feel like a run-of-the-mill professional and don't understand why I need to pay so much to just submit *information*.
> 
> Are there any advocacy groups that try to lessen the burden on "normal" expats?


AARO (based in Paris) and ACA (based in Switzerland someplace) are the two main expat groups that usually have an annual week of "lobbying" in Congress on behalf of expats. They do tend to have US tax attorneys on their boards, who always seem to advise that trying to change the "taxation by nationality" thing is pretty much a lost cause. (Though if the law were ever changed, these same board members would pretty much lose their livelihoods... so I've always wondered about that particular advice.)

Still, take a look at the websites of the two organizations and maybe you'll find a cause you can get behind. They do advocate for us overseas residents, especially when section 911 is threatened. (Section 911 is the FEIE.)
Cheers,
Bev


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## DavidMcKeegan (Aug 27, 2012)

If you go to one of the "big four" accounting firms then yes, those prices are easily seen (paying 2-3K a year for an expat return is not uncommon). However, there are some specialized expat firms out there (such as ourselves), that can do it for a fraction of the cost.

You sacrifice having a physical office to go to (most are conducted exclusively online), but you get the same expertise (if not better) as you would get with the big firms.

Also, if you change your business structure so that it is flowing through you (not as a separate entity), you can eliminate the need for Form 5471 in future years.

Let me know if you have any questions.

David


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