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taxadvisor.uk
taxadvisor.uk, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 4996
Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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Just completing my UK tax return. I hold dual nationality.

Resolved Question:


Just completing my UK tax return.
I hold dual nationality. UK/US. Have two employers one UK based where I now reside and one US based.
I am a home worker US employment. I now have purchased a home in UK on which I have a mortgage. Can I claim any tax relief.
Thanks
Submitted: 2 years ago.
Category: Tax
Expert:  taxadvisor.uk replied 2 years ago.

and welcome to the site. Thank you question.

Unfortunately, there is no relief interest on private residence unlike the USA, I'm afraid.

Confirmation of this can be found here

http://www.theguardian.com/uk/1999/mar/10/budget1999.budget3

I hope this is helpful and answers your question.

If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.

Customer: replied 2 years ago.

Sorry to hear that. Apologies in reply. Broadband went down. Must be snow on airways. Just one final query. I pay tax in US at 8% do I claim all the tax I paid on my US salary as Foreign Tax Credit relief and insert the tax paid figure in box 2 of the foreign income part of my tax return.

Expert:  taxadvisor.uk replied 2 years ago.

Flora, thank you reply and welcome back.

You claim foreign tax credit relief against foreign tax paid.
You don't have to work out the FTCR yourself.
You should complete the section "Foreign tax paid on employment, self-employment and other income" on SA106 Page F6.

More information on this can be found here

https://www.gov.uk/government/publications/self-assessment-foreign-sa106

I hope this is helpful and answers your question.

If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.

Customer: replied 2 years ago.

When I don't insert a figure at 2 and just insert my income and tax paid and tick x to claim at 30-32 I appear to owe the tax man a sum equal to the tax I have already paid in US. There does not appear to be a calculation made when I look at summary. When I insert the tax paid in 2 as the FTCR I don't owe any. My tax is paid and taken at source from my UK salary.

Expert:  taxadvisor.uk replied 2 years ago.
Flora, thank you reply.

If you are UK resident purposes, then you are taxed in the UK on worldwide income.

You claim foreign tax credit relief against tax suffered from your US employment.

If you have paid foreign tax on your employment income, you should also fill in the employment page.

If you wish to work out FTCR yourself, look at helpsheet 263 to calculate FTCR on income. The link is here

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/323640/hs263.pdf


I hope this is helpful.
Customer: replied 2 years ago.

Had a look at form-designed by a sadist I think

I just have salary income and tax paid and no idea which boxes they go in.

Sorry-help??

Expert:  taxadvisor.uk replied 2 years ago.

Flora, thank you reply.

This is what I would do....

Complete
- Employment pages UK salary and US salary.
- section dealing with foreign tax paid on employment (SA106 page F6 of what to be provided).. state values in GBP and not USD

- Any other information box (on page TR7) and notify that foreign income is shown within employment pages.

I hope this is helpful.

Customer: replied 2 years ago.

I have done that leaving Foreign Tax Credit Relief box at 2 vacant. Comes out showing I owe tax equivalent to what I paid as tax in US. Self assessment does not appear to give me any credit so appears I am paying tax twice.??

So suspect I just have to pay the tax man. ??

Expert:  taxadvisor.uk replied 2 years ago.
Flora, thank you reply.

You stated you had paid tax in US at 8%.
In the UK the basic tax rate is 20%...
So you would be expected to pay a similar amount here (20%-8%).

I hope this is helpful.
Customer: replied 2 years ago.

But it looks like I am paying twice.?

Expert:  taxadvisor.uk replied 2 years ago.

Flora, thank you reply.

It looks like you are paying twice because of the big differential in income tax rates.. 20% in UK and 8% in US.

If you had paid income tax at 20% in the US then there would be no further tax to pay to UK authorties under Double Tax Agreement between the two countries.

Under DTA you don't pay tax twice on the same income.

I hope this is helpful.

taxadvisor.uk and other Tax Specialists are ready to help you
Expert:  taxadvisor.uk replied 2 years ago.
I thank you my answer.

Good luck.