# USA or UK - trying to find advice on the tax / financial differences for a UK/USA couple



## JHKL (Jul 21, 2021)

I'm hoping someone can point me in the right direction to start my research on a Tax/financial question... my fiance and I (he is USA, I'm UK), are starting to discuss where we would like to live long term once married. We both work and can work in either country due to work permits, and both earn similar amounts, but we would like to put down more secure roots in one place. Is there a beginner's guide to the differences between moving to the USA versus moving to the UK in regards to tax and fianances. Obviously I assume we will need a good accountant later down the line, but for now we are just trying to weigh up the pros and cons.


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## Nononymous (Jul 12, 2011)

One obvious thing to consider is that if you live in the US, you will be able to deem yourself non-resident as far as the UK is concerned, and will only file US tax returns. If it's the other way around and you live in the UK, your husband as a US citizen will be required to file both US and UK tax returns. That in itself is mostly just paperwork - he'd receive credits for UK taxes paid so would likely owe nothing to the US - but US tax compliance can severely limit his options for investment, because many things that are normal in the UK are rather toxic as far as the IRS is concerned.


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## Bevdeforges (Nov 16, 2007)

I've moved you over here to the Expat Tax section because we have more "international" perspective on taxation here.

The biggest thing to consider/understand is that the US partner (your fiance if I'm reading your post correctly) will continue to be subject to US taxation no matter where in the world you live - and that can have some knock-on effects on you, particularly if you have joint financial accounts or if you have been living for some time in the US on an immigrant visa.

You and your fiance may want to take a look at IRS publication 54 on "overseas taxpayers" for an overview of what is involved.There are tax treaties between the US and UK (or between the US and other countries) that attempt to avoid dual taxation, and there are also reporting requirement about foreign (to the US) financial accounts and assets that your fiance will have to report on annually to the IRS. All of this may affect how you want to set up your family finances no matter where you decide to live.

The other big matter that will affect your family finances will be that of what is covered under your country of residence's tax system. In the UK (as well as in most of Europe), taxes are somewhat higher than the US Federal taxes, however you'll be covered for health insurance, certain other "welfare" benefits (unemployment, family allocation, housing assistance, etc.) and there may well be a mandatory retirement system. Just for the record, you are generally subject to the labor laws (including benefits and "social insurance" contributions) of the country in which you are considered "tax resident" - even if US citizens are always considered "tax resident" no matter where in the world they may be living.

One other source to take a look at are the tax guides published by the large, international public accounting firms. This is the PWC (Price Waterhouse Cooper) guide for the UK as an example: United Kingdom - Overview I tend to go to this one since I used to work for Price Waterhouse, but all the big accounting firms have something along the same lines. Your current employer may be able to get you a paper copy of the tax guide put out by their public accounting firm.

That should get you started, at least. Holler as you have further questions.


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## 255 (Sep 8, 2018)

@JHKL -- @Nononymous & @Bevdeforges have given good advice, but I would urge you to look further. Your overall taxes will be similar with either location, despite the complications of your soon to be U.S. citizen husband (Congratulations,) as long as he maintains his U.S. citizenship (a quick perusal of this forum will yield a litany of ex U.S. citizens, that live overseas.)

There are advantages and disadvantages to living in either country. The U.S. has many varied locations and some great job opportunities. Your individual career fields may come into play. Europe in general (including the UK,) has a much more robust social assistance network.

Of course, there is another option -- i.e. to live in a totally different country, that might meet your needs. As far as taxes go, there are many countries in the world where you might pay very low or even zero taxes. Cheers, 255


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## Bevdeforges (Nov 16, 2007)

One small caveat to what 255 has said here. Way back in my MBA school days, and continuing through my public accounting training and service, they drilled into us the notion that you should never take a "life decision" based solely or even "primarily" on the tax aspects. You take big decisions (like where to live) based on all the facts and considerations and then you work out the tax side as it comes up. Tax policy changes all the time and there are usually ways to deal with it. Paying low or zero taxes on a low or zero income isn't really much of an advantage over paying high taxes on a huge salary - though it depends quite a bit on the other aspects of living in a particular place.


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