# British Citizen / American Resident moving to Thailand - Residency Decision



## BritAmerican

I am planning a potential move to live and work in Thailand and will likely stay in Asia indefinitely. I am a British citizen and have been a US resident green card holder (married to my American wife) for the last 6 years. I will be working for an American company but will be paid locally in baht and my company will not provide tax equalisation.
Does anybody know if there are advantages/disadvantages of remaining a US resident or reverting to the UK as my home country while building up my residency in Thailand. We do not expect to return to either the US or UK.
Thanks for this and any other advice as I review my company's offer to make the one-way move!


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## Fatbrit

Well you certainly don't want US residency if your primary goal is avoiding Uncle Sam and his cousins. US permanent residents and citizens are taxed on their worldwide income. Your wife doesn't have an out, but you do! The question over whether you should try to hold on to it is moot anyway since you appear to be abandoning it.

Generally, the UK doesn't tax non residents.


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## singto

Fatbrit said:


> Well you certainly don't want US residency if your primary goal is avoiding Uncle Sam and his cousins. US permanent residents and citizens are taxed on their worldwide income. Your wife doesn't have an out, but you do! The question over whether you should try to hold on to it is moot anyway since you appear to be abandoning it.
> 
> Generally, the UK doesn't tax non residents.


That's not exactly true Fat Brit - U.S. citizens are not taxed on the first $84,000 of their income.


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## Fatbrit

singto said:


> That's not exactly true Fat Brit - U.S. citizens are not taxed on the first $84,000 of their income.


They're taxed as in they have to fill out a tax return. There is indeed an $84k bonus (at the moment!) and if you're resident in the UK, the double taxation agreement will cut in and might save your bacon. However, you have to plan accordingly because it doesn't save all bacons. Is there a double taxation agreement between Thailand and the US?

Normally, many people would be advised to naturalize as a USC before they leave to preserve their right of return. However, since the OP stated he had o plans to return and seemed particularly anxious about tax, I didn't bother pushing it.

OP possibly also has confusion about his US PR status. The most common misconception that the length of the status is tied to the expiry of his green card. Nothing could be further from the truth.


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## singto

Fatbrit said:


> They're taxed as in they have to fill out a tax return. There is indeed an $84k bonus (at the moment!) and if you're resident in the UK, the double taxation agreement will cut in and might save your bacon. However, you have to plan accordingly because it doesn't save all bacons. Is there a double taxation agreement between Thailand and the US?
> 
> Normally, many people would be advised to naturalize as a USC before they leave to preserve their right of return. However, since the OP stated he had o plans to return and seemed particularly anxious about tax, I didn't bother pushing it.
> 
> OP possibly also has confusion about his US PR status. The most common misconception that the length of the status is tied to the expiry of his green card. Nothing could be further from the truth.


If you are taxed on your income in Thailand you are not taxed on the same income in the US and vice versa.

The bonus effectively negates any taxes on the first $84,000 earned in Thailand. You do not pay taxes on the first $84,000 earned in Thailand–at least for now.

I've got no idea about the UK-Thailand connection but for me, I've never had any problems with taxes as I somehow always come in under the amount of the credit.


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## Fatbrit

singto said:


> If you are taxed on your income in Thailand you are not taxed on the same income in the US and vice versa.
> 
> The bonus effectively negates any taxes on the first $84,000 earned in Thailand. You do not pay taxes on the first $84,000 earned in Thailand–at least for now.
> 
> I've got no idea about the UK-Thailand connection but for me, I've never had any problems with taxes as I somehow always come in under the amount of the credit.


So perhaps the OP should consider naturalization before leaving? Incredible how many leave the US then decide they want to come back.


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## BritAmerican

Thanks for the input. I suspect I'll need to do plenty of more research. If I choose to give up my US residency (I would need to travel back to the US every 6 months to keep it) and was then a British citzen paying taxes in Thailand, would the UK still collect tax on me even though I have not lived there for 14 years?


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## Guest

Have you checked the comparative levels of tax for your level of income? I would have thought that would be a key factor. Thailand isn't exactly a high tax country.

Whether you can live for the bulk of the year in Thailand, working for a Thai-registered company (or if not, have you looked into the work visa requirements?)... and not pay tax locally... you need professional advice. Double taxation ? The draft agreement:

http://www.thailawforum.com/database1/double-taxation.html

The full 31 page version is in force. It'll be on the web somewhere - happy reading!


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## Fatbrit

BritAmerican said:


> Thanks for the input. I suspect I'll need to do plenty of more research. If I choose to give up my US residency (I would need to travel back to the US every 6 months to keep it) and was then a British citzen paying taxes in Thailand, would the UK still collect tax on me even though I have not lived there for 14 years?


Popping back every 6 months would NOT preserve your US residency. Might have worked for some folks in the pre-9/11 world but it doesn't work now. You will quite quickly run into a slanging match with the more powerful dark forces at the border. The only guaranteed way to preserve your right to live and work in the US is to naturalize as a USC.

You will not be taxed by the UK authorities on any income from outside the UK, nor will you be required to complete a tax return.


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## Bevdeforges

singto said:


> If you are taxed on your income in Thailand you are not taxed on the same income in the US and vice versa.
> 
> The bonus effectively negates any taxes on the first $84,000 earned in Thailand. You do not pay taxes on the first $84,000 earned in Thailand–at least for now.
> 
> I've got no idea about the UK-Thailand connection but for me, I've never had any problems with taxes as I somehow always come in under the amount of the credit.


Actually, if both husband and wife are working in Thailand (don't know how likely it is) you can double that "bonus" as each is entitled to their own exclusion - but only on earned income. 

In any event, the wife would continue to have to file (as a US citizen) no matter what. If she has no earned income, then her exclusion doesn't help her husband (though he would not have the US filing obligation if he is no longer US resident). She would be filing "married, filing separately" which can complicate things a bit depending on your particular situation.

Other than the tax situation, however, the only consideration I can think of is that of going back to the US. You may not want to return at this point, but having the right to return does give you the advantage should an interesting job arise based back there.
Cheers,
Bev


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## BritAmerican

Thanks again to everybody for the input and ideas.
Bev: my wife will likely do charity work and have no income other than a little US investment (<$5k/year).
We currently jointly own a home in the US and will look to sell if the housing market lets us!
We would likely have her file separately so I would be interested to know what the major complications could be.
I will be taking some professional advice but it is very helpful for me to hear from real life experiences and other input as I have found the professionals can often overlook things, especially for the serial movers like us!
Thanks!


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## Winkie

Just an aside, but do also note that Charity work (voluntary/unpaid) can also land you in Vis troubles, and officially you require a Work Permit. Therefore if anything milding prominent is planned, please take note.


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