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TaxRobin
TaxRobin, Tax Consultant
Category: Tax
Satisfied Customers: 32149
Experience:  International tax
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I am a British Citizen going to be studying in the US

Customer Question

Hi, I am a British Citizen going to be studying in the US (Florida) for 2 years.
JA: Have you talked to a tax professional about this?
Customer: I am weinghing up my options as i have been offered an option to do some remote work for the company with which i am currently employed - but I need some advice as it relates to tax and national insurance here in the UK and Tax in the US No I haven't yet
JA: For which tax year do you need advice?
Customer: I will start my course 22nd August 2022 and expected to end 2024/2025
JA: Is there anything else the Accountant should know before I connect you? Rest assured that they'll be able to help you.
Customer: I am currently employed full time in the UK (effectively resigned) and if I decide to accept this role (subject to proper permisions and conditions of my F-1 student visa) I will be self employed working maximum of 20 hours per week
Submitted: 16 days ago.
Category: Tax
Expert:  TaxRobin replied 16 days ago.
Hello and thank you for allowing me to assist you.
Customer: replied 16 days ago.
Hello
Expert:  TaxRobin replied 16 days ago.

The exact language in US Immigration and Customs Enforcement’s guidance states: ‘A student on OPT may start a business and be self-employed. The student must be able to prove that he or she has the proper business licenses and is actively engaged in a business related to the student’s degree programme.'”

USCIS notes that those on an F-1 visa may not work off-campus during the first academic year, but may accept on-campus employment subject to certain conditions and restrictions. After the first academic year, USCIC notes that F-1 students can engage in three types of off-campus employment:

  • Curricular Practical Training (CPT)
  • Optional Practical Training (OPT) (pre-completion or post-completion)
  • STEM Optional Practical Training Extension (OPT)

F-1 students could be eligible to work off-campus on a case-by-case basis as a result of special situations such as severe economic hardship or special student relief.

Most F-1 students are considered nonresident aliens by the IRS. As a nonresident alien, you will need to file form 1040-NR (federal tax return) to assess your federal income and taxes. Important: As of 2022, the IRS no longer uses form 1040-NR-EZ.


Customer: replied 16 days ago.
does that mean I can’t work for my current employer (re
Expert:  TaxRobin replied 16 days ago.

Not in the first year

Customer: replied 16 days ago.
Related to my degree subject)
Expert:  TaxRobin replied 16 days ago.

Right

Customer: replied 16 days ago.
Ok - if I were to get the permission to work during my 1st year from USCIS (currently seeking advice from my Designated Student Officer about this), what would the tax implications be?
Expert:  TaxRobin replied 16 days ago.

You will pay NON RESIDENT Tax in US and get a credit on UK tax

Customer: replied 16 days ago.
if that doesn’t work and I were to work in my 2nd year, what are the tax implications here in the UK and US
Expert:  TaxRobin replied 16 days ago.

The same...you will pay tax in US because you are physically in the US and working but UK will allow a credit

Customer: replied 16 days ago.
Ok thanks and how would I go about filing for UK tax credit?
Customer: replied 16 days ago.
Ok, this is for working (remotely) in the UK
Expert:  TaxRobin replied 16 days ago.

You usually need to fill in a Self Assessment tax return if you’re a UK resident with foreign income. 

Expert:  TaxRobin replied 16 days ago.

You are IN The US working so they will tax you.

Customer: replied 16 days ago.
It would be UK income
Expert:  TaxRobin replied 16 days ago.

Not by US Law

Customer: replied 16 days ago.
Ok I understand
Expert:  TaxRobin replied 16 days ago.

Generally, U.S.-sourced income includes all income received from U.S. organizations or individuals and compensation received from both U.S. and foreign organizations or individuals for work performed in the U.S.

Customer: replied 16 days ago.
just to summarise,Likely not able to work first year (even if I’m working in my field of study, remotely in the UK)If I am able to work, I will need to complete a Self Assessment tax return in the UK and file tax form 1040-NR in the US
Expert:  TaxRobin replied 16 days ago.

Correct

Customer: replied 16 days ago.
Ok thank you very much for your help
Expert:  TaxRobin replied 16 days ago.

You are welcome