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Sam, Accountant
Category: Tax
Satisfied Customers: 14192
Experience:  26 HMRC expertise, PAYE, Self Assessment ,Residency, Rental Income, Capital Gains, CIS ask for Sam Tax
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My wife is a US citizen but resident in the UK (with a

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My wife is a US citizen but resident in the UK (with a premanent leave to remain stamp). We have been married for 7 years. She receives a US Social Security pension in the US which is not (and never) remitted to the UK. It exceeds £2000 per annum. How is she taxed and what should she declare? Here UK income is a small UK Social Security Pension and a small income from elf employment for work carried out soley in the UK.


Thanks for your question, I am Sam and I am one of the UK tax experts here on Just Answer.

How long has your wife been resident in the UK - as at this stage you should either be declaring it - or claiming the remittance basis (where the income does not enter the UK) but this does see a loss of UK personal allowances (which are worth £11,000 x 20% = £2200) which would be relevant if there is UK income arsing for them to be utilised against, on which you advsie there is.

But as this is in excess of £2000 these are the two options and I should advsie that when your wife has been resident for 7 out of the last 9 years, then also a remittance basis charge arises, so lets see how best to take this forward for your wife

So when did your wife arrive in the UK AND how much is her annual income (approx)




Customer: replied 1 year ago.
SHe arrived originaly as a student in about 2001, Her permanent residency certificate is dated Sept 2006. Annual pension (US) income is $12000, annual UK income is about £7000 (net of self employmeny operatin costs).


Thanks for your response

Then this income should have either

1) declared as worldwide income from 2001 (its from the date she began to reside in the UK not the date of permanant residency) OR

2) Fallen within the remittance basis

But either way your wife should have registered for self assessment with HMRC and whilst for the first 6 years she could claim remittance basis - as this will see the loss of personal UK tax allowances which will see tax becoming due on any incomes that arose within the UK from that date.

However from the time she has been resident in the Uk to the 7th year, then not only does claiming the remittance basis see a loss of entitlement to UK personal tax allowances, it also sees a remittance basis charge (which starts at £30,000 a year) so my advsie is

Make a full disclosure to HMRC back to the year this US income commenced (or from 2001if it commenced prior to this) as this will mitigate the penalties and interest charges far more than not making a disclosed

And start this by amending the tax returns filed since the self employment began by adding in a foreign income page and then writing into HMRC re the earlier year disclosures

Let me know if I can assist further, or if you have all that you need, then it would be appreciated, if you could rate me for the level of service I have provided , or click accept



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