# IRS Form 1116



## chammer

Hello, I'm considering using the foreign tax credit when filing my US taxes. 

I live and work in the UK and am on PAYE. Does anyone know, does National Insurance deductions count as tax paid? 

Thanks!

Carolyn


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## Bevdeforges

Simple answer: no

You can take the tax credit only for income taxes paid. No other sorts of tax can be used for the form 1116 tax credit.
Cheers,
Bev


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## BBCWatcher

And it's the IRS's definition of income taxes. Occasionally that definition exceeds a foreign country's own definition. As one example, a lot of countries deduct tax from bank interest payments before you even see the interest. Generally those taxes on bank interest -- whatever they're called -- are income taxes according to the IRS.


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## Bevdeforges

Generally, if a bank deducts taxes at the source that's income tax and considered as such by the home jurisdiction. What isn't considered creditable "income tax" are things like VAT (not even deductible as "sales tax" in the days that sales tax was deductible) and what in the US they call "payroll taxes" - usually social insurances (National Insurance in the UK).
Cheers,
Bev


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## chammer

Thanks for the very rapid replies. I've now successfully completed my 2011, 2012 and 2013 returns!! Using 2555-EZ I do not owe anything  

Thanks again!


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