Streamlined Filing Compliance Procedures

All You Need to Know About Streamlined Filing Compliance Procedures

If you are a US expat living in the UK, you have to file US taxes every year and report the money you have in foreign banks with the help of the Foreign Bank Account Report (FBAR). 

It is quite common that US and UK expats don’t know about their tax duties once they are living and working abroad, especially if they are the first ones from the family to settle in a faraway land. Many often misunderstand or overlook the tax duty and think that they have to file taxes only for the country that they now live in. 

In case of honest mistakes, IRS has a history of showing leniency allowing expats to catch up on their past taxes with Streamlined Filing Compliance Procedures. Through this procedure, expatriates who were unaware of their tax obligations are able to catch up with previous years’ filings and minimise the penalties.

How to know if you qualify for Streamlined Filing Compliance Procedures?

In order to qualify for the Streamlined Filing Compliance, you need to be living outside the US for at least 330 days during any of the previous three years.

You also need to confirm and prove that you failed to file the US tax returns due to a genuine misunderstanding or lack of knowledge.

Once you qualify for the Streamlined Filing Compliance Procedures, you will have to ensure the following:

  1. You need to file the missed income tax returns for the previous three tax years which were delinquent.
  2. You then have to file an FBAR for the previous six tax years.
  3. Once you have filed the two, now you need to provide a complete statement of explanation in which you mention in detail the reason why you didn’t file your income tax return and FBAR.
  4. Now, the last and the most straightforward of all the steps, you need to pay the tax along with the interest due for the previous three tax years.

Does this overwhelm you?

Well, Streamlined Filing Compliance Procedures do require a lot of paperwork. So, it is wise to consult experts who have in-depth knowledge of how things are done.

Xerxes provides late or delinquent tax filers with reliable advice and efficient assistance in getting tax compliant with the IRS with the help of the Streamlined Program. The agents enrolled in the IRS help you identify, gauge and calculate the additional penalties and interests.

If you have lived outside of the US for at least a period of 3 years and have not filed US taxes, you can reach us for a no-obligation chat. Speak to one of our members to know your options and all that you need to do to catch up with your missed tax filings.

It is wise to note here that the Streamlined Filing Compliance Procedures is strictly for US taxpayers who have genuine reasons for overlooking their previous years’ US tax responsibilities. Only in cases where your delay or delinquency is not wilful, you can qualify for the program and catch up with your unpaid taxes.

Do you need help getting caught up with taxes? Xerxes Associates LLP work closely with US and UK expats from all different backgrounds, circumstances and occupations as well as high-net worth individuals in order to help them through the complexities of US and UK tax compliance requirements. Contact us if you have any questions or would like to chat about your requirements in a friendly, no-obligation manner.

Contact us if you have any questions or would like to chat about your requirements in a friendly, no-obligation manner.

Tax Advice for US Expats Living In The UK

Tax Advice for US Expats Living In The UK

Xerxes Associates LLP makes filing US income taxes for US expats living abroad seamless and simple. We understand the dynamics of being a US citizen living abroad in countries like the UK and cities such as London. We take pride in helping you understand US expat tax laws and rules without overwhelming you with difficult tax terminology. We work with simple situations and very complex US expat tax returns.

We value our client’s confidence and we work hard to build trust and lasting relationships. Every US expat tax return is a unique and niche situation because the foreign country you reside in has a different currency, different types of retirement accounts, and different agreements with the USA.  If you also add the complexity of your personal tax situation, most inexperienced tax advisers simply do not deliver the service you will require and need.

The stakes are high with US expat tax returns because failing to file a foreign bank account report or another required international informational return can come with penalties of $10,000 or more.  The IRS can also deny the foreign earned income exclusion or foreign tax credits if they are used incorrectly.

Our US & UK clients enjoy working with Xerxes Associates LLP because we proactively engage with them on all key issues and help you ensure there are no misunderstandings of what the IRS requires.  A professionally completed, accurate tax return that is e-filed is really the best way to stay on the good side of the IRS!

Do you need help getting caught up with taxes? Xerxes Associates LLP work closely with US and UK expats from all different backgrounds, circumstances and occupations as well as high-net worth individuals in order to help them through the complexities of US and UK tax compliance requirements.

US Expats living in the United Kingdom can contact us if you live in any of the following areas;

  • – London
  • – Birmingham
  • – Manchester
  • – Leeds
  • – Scotland
  • – Wales
  • – All towns, cities and remote locations in England and Wales

Contact us if you have any questions or would like to chat about your requirements in a friendly, no-obligation manner.

US Tax Return London

US Tax Return London

Are you A US Expat Living Abroad & Haven’t Filed Your Taxes?

You might be living overseas and concerned that you haven’t filed US taxes. If you are an US expat, you might consider getting into tax compliance before it is too late. Our ‘US Tax Return London and UK’ product is a bespoke service designed to tackle any and all possibilities on your behalf. Here are some important points for you to understand about US tax returns.

 

  • – Filing US taxes is required even when working and earning an income overseas.
  • – Even if you earn an income overseas, you must file your US taxes.
  • – Not paying US taxes could cause problems when renewing your passport.
  • – It is impossible to predict what the US Government will do in the near future, particularly with regard to immigration.

 

If you use the ‘Foreign Earned Income Exclusion’ and the ‘Foreign Tax Credit’ together, you may not owe as much US tax as you think you do.

Self-employed people and people who live in countries not covered by the ‘Totalization Agreement’ may owe taxes that fund their payments to Social Security.

It is difficult to determine how many tax returns are needed to be filed in terms of previous years, however, people who file tax returns for the previous six years seemingly satisfy the IRS system. However, some people try to file less than six and the response from the IRS is not always favourable.

Here is some motivation to reach out to us and start the process; the pandemic stimulus payments will be provided to you if you file 2020 2021 returns (if you qualify). Contact us here. Xerxes Associates LLP is a leading firm of tax advisers qualified in both the United States (IRS) and the United Kingdom (HMRC) tax procedures.

There is nothing more complicated, confusing, time-consuming, or even a bit frightening than filing a tax return. With our help, Americans and Brits can understand US and UK tax easily. No matter what form you’re trying to complete, what questions you’re asking or how much tax you’re trying to save, we can help you.

Xerxes Associates LLP work closely with US and UK expats from all different backgrounds, circumstances and occupations as well as high-net worth individuals in order to help them through the complexities of US and UK tax compliance requirements (tax imposed on expatriates). If you have a query or would like a friendly no obligation chat about your requirements then please get in touch and we shall be happy to assist you.

Xerxes Associates Provide Comprehensive Tax Services To U.S. Expats

Xerxes Associates Provide Comprehensive Tax Services To U.S. Expats

There are a variety of expat services available however, Xerxes Associates LLP offers you a premium and efficient service which has made us the number one choice for U.S. expats living in the UK.

In order to meet your specific needs, Xerxes Associates LLP offers US Expats living in the UK a range of reliable services bespoke to your personal taxation requirements. There is no one better equipped to handle complex expat tax issues than the Xerxes Associates LLP team.

U.S. Tax Compliance Services

A U.S. citizen or U.S. green card holder must file a U.S. tax return annually to report their worldwide income, regardless of whether they owe any tax. It’s still necessary to file a U.S. tax return even if you earned all of your income abroad and paid taxes in your country of residence.

There are a number of exclusions and credits available to you and you can minimise your U.S. federal tax liability by optimising your tax return. Xerxes Associates LLP can help you achieve maximum tax optimisation and efficiency.

Xerxes Associates LLP provide the following range of tax preparation services:

– Completion of individual Federal US resident and non-resident tax returns (Form 1040 and Form 1040NR).

– Streamlined filing for delinquent filers.

– Preparing expatriation returns.

– Preparing and submitting Foreign Bank Account Reports (FBAR) forms.

– Completion of State Tax Returns.

– Planning for moving to or from the US.

– Planning of UK/US profit extraction from companies including the resolution of both the Repatriation Tax and the GILTI Tax.

– Claims for Foreign Earned Income deductions.

– Claims for Foreign Tax Credits.

– Crypto Tax Advice.

Our dual-qualified team of tax advisers can look after your personal tax affairs as well as those of your business. We have been helping our clients manage their tax affairs for over 10 years now and can assist you with all associated complexities.

Xerxes Associates LLP work closely with US and UK expats from all different backgrounds, circumstances and occupations as well as high-net worth individuals in order to help them through the complexities of US and UK tax compliance requirements (tax imposed on expatriates). If you have a query or would like a friendly no obligation chat about your requirements then please get in touch and we shall be happy to assist you.

Important Information for American Expats in the UK and their US taxes

Important Information for American Expats in the UK and their US taxes

No matter where they live, U.S. citizens and residents pay taxes on their worldwide income. Therefore, you must also report any income you report on your UK return on your US return. Filing requirements in the US are determined by your filing status and your income amount.

Finding conformity between your UK and US tax year

In the UK, the tax year runs from 6th April to 5th April, so submitting your US tax returns may be difficult as the IRS expects to see your earnings from January 1 to December 31.

This issue can be addressed in many ways, but we find the most accurate method is to use the following formula:

Take the amount of your P60 this year – The YTD amount from your PAYE statement from the previous year + The YTD amount from PAYE statement of this year = The amount current year amount.

In addition to calculating the amount of money you earned last year, this calculation can also be used to calculate the amount of money you paid to HMRC during the year.

Avoid paying taxes twice

There should never be a double taxation of the same income. Americans in the UK typically pay their income tax to the UK first, then file their US tax returns. Foreign Tax Credits are available in both the United Kingdom and the United States, thus allowing for a smaller tax due amount on foreign-sourced income.

Totalization Agreement

The Totalization Agreement came into effect in February 1984. As a consequence, US citizens living in the UK are not subject to double social security payments or taxation.

Exemption from foreign earned income – Form 2555

If US expats living in the UK meet either the Bona Fide Residence Test or the Physical Presence Test, they may qualify for a reduction or, in some cases, pay zero US tax.

Report of Foreign Bank and Financial Accounts – FBAR

Every year, Americans who have accounts outside the United States with a balance of at least $10,000 must file a FBAR, or FinCEN Form 114, by October 15. Bank, investment, and retirement accounts should be included in the report, converted into US dollars. The Form 8938 is required for taxpayers with UK accounts worth more than $200,000.

Xerxes Associates LLP work closely with US and UK expats from all different backgrounds, circumstances and occupations as well as high-net worth individuals in order to help them through the complexities of US and UK tax compliance requirements (tax imposed on expatriates). If you have a query or would like a friendly no obligation chat about your requirements then please get in touch and we shall be happy to assist you.

US Expat Tax Advice When Living In the United Kingdom

US Expat Tax Advice When Living In the United Kingdom

A PAYE system is used by most UK employers to withhold taxes from employees’ paychecks.

You will need to file a UK tax return if ‘any’ of the following applies to you;

  • – Your income is exceeding £100,000 including any benefits
  • – Your investment income exceeds £10,000 per year
  • – Your self-employment income is £1000
  • – You are the director of a company (unless you receive no salary and/or benefits)
  • – You and your partner have income exceeding £50,000 whilst claiming Child Credit
  • – You have income from a source external to the UK

 

A form should be sent to you if you are required to file by Her Majesty’s Revenue and Customs (HMRC). HMRC offers a tool that can be used for checking your tax filing obligations. In addition, you may be able to receive deductions from HMRC by filing a tax return.  Viable deductions  include donations to charities, private pension contributions and work related expenses over £2,500.

HMRC requires you to register online if you have not received a tax form from them. Avoid late filing penalties by doing this as early as possible.

The types of income you should report will depend on your residency status. The only income you need to report if you are a non-resident is UK-sourced. UK residents whose permanent home, or “domicile,” is outside the UK and who are not considered “ordinary residents” are subject to special rules.

Residency status is determined by how long you intend to stay in the UK and how many days you spend there physically. Generally, if you live in the UK for at least two years, spend more than 183 days here or average more than 91 days there over the past four years, you are considered a resident for tax purposes.

It is common for US expats in the UK to be considered non-UK domiciled. UK residence and domicile regulations are constantly being updated by HMRC. If you want to be clear about your domicile status while living in the UK, we strongly encourage you to speak with a UK & US tax experts sooner rather than later.

Xerxes Associates LLP work closely with US and UK expats from all different backgrounds, circumstances and occupations as well as high-net worth individuals in order to help them through the complexities of US and UK tax compliance requirements (tax imposed on expatriates). If you have a query or would like a friendly no obligation chat about your requirements then please get in touch and we shall be happy to assist you.

US Tax Returns And Tax Planning For US Citizens Living In The UK

US Tax Returns And Tax Planning For US Citizens Living In The UK

Xerxes Associates LLP have been preparing US taxes for Americans living in the UK for over 20 years. We are experts in all aspects of US tax procedures and we offer a professional, responsive and personalised service to all US and UK expats.

Every US citizen including Green Card holders (equivalent to a permanent stay visa) is required to file a US tax return every year. In addition to preparing individual US federal and state tax returns, Xerxes Associates LLP can also consider the tax efficiency of your funds, assets, savings and investments.

The ability for Xerxes Associates LLP to handle both UK and US taxes is important to our clients who have lived in the UK from a few days to a number of years. We are able to advise individuals on all matters related to taxable income from the US, UK and other parts of the world. Click here to view the full list of our packages and prices.

Tax filing requirements in the US do not stop just because you no longer earn income in the country. Citizens of the US are taxable on their worldwide income if they hold US citizenship. A US tax return must still be filed if you have an employment contract in the UK, but do not earn US income.

No matter how complex your US tax return is, Xerxes Associates LLP can assist you. We can even help if you have not filed for many years and want to get back on track. By taking advantage of the The Streamlined Tax Amnesty program, we can help chisel a route which is the best way for US citizenship holders in the UK to catch up on their US taxes.

Once you earn more than $12,400 USD as a single filer, you have to file a tax return. There is a threshold of $24,800 for married joint filers, and an additional threshold of $18,650 USD for heads of household. When your income exceeds the filing threshold, you’ll need to file a US 1040 Federal Tax return for that year, regardless of the currency.

Married couples filing separately need only earn more than $5 USD to file a US tax return. You must file a US tax return if you are married to a non-American and your worldwide income exceeds $5 USD. You still need to file taxes even if you do not work or earn an income.

You must file a US tax return if you are self-employed, or if your self-employment income exceeds $400 USD per year (in any currency from any country).

Xerxes Associates LLP work closely with US and UK expats from all different backgrounds, circumstances and occupations as well as high-net worth individuals in order to help them through the complexities of US and UK tax compliance requirements (tax imposed on expatriates). If you have a query or would like a friendly no obligation chat about your requirements then please get in touch and we shall be happy to assist you.

Are you looking for US tax accountants and advisors in London or the UK?  View our fees and packages for UK and US tax return services.

Choosing The Right US Expat Tax Advisor

Choosing The Right US Expat Tax Advisor

Who Can Provide US Expats With Expat Accountant Service And Expat Tax Assistance?

Xerxes Associates LLP are expert specialist US & UK tax accountants and advisers based in London with over 10 years of valuable experience. As US and UK tax accountants, we offer a professional, responsive and personalised service to all US and UK expats.

 

What Is The Difference Between A Tax Adviser UK, Tax Consultant London & Tax Accountant London?

Essentially they are the same in respect of the core preparation service they all provide. As UK & US Tax Advisers and Accountants, Xerxes Associates LLP offer more than just the basic advisory and tax return preparation services. We also offer all of the required key services to expats in both the United States and United Kingdom.

 

What is an Expat Tax Advisor?

Living and working outside of your home country? Then you will probably need to submit an expat tax return. The easiest way to do so is to instruct a company which employs expat tax professionals like Xerxes Associates LLP.  If you live and work in the UK then you need to search for expat tax advice UK, for locally based specialists like ourselves to ensure the smooth processing of your tax returns.

 

How To File US Taxes And Tax Return From The UK?

It’s simple to file U.S. taxes in the U.K. with Xerxes Associates LLP. Our expat tax advisors are here to help. Here’s how to file your U.S. expat taxes.

  • Head on over to our contact page and reach out to us. Alternatively, request us to call you by requesting a call back.
  • Once we have confirmed which service package suits you best, we shall start to prepare your return.
  • We file your return with the IRS and HMRC or as required.
  • You can sit back knowing your taxes are taken care of.

 

As Tax Accountants London & Providers of Tax Advice London, Do You Offer Your Services To Expats Living Elsewhere?

We offer our services to all US and UK expats living anywhere including the whole of the UK, USA and other parts of the world.

 

What Is UK Expat Tax Advice?

You can still be liable to pay UK taxes even if you are not a UK resident. If you’re leaving the UK permanently or going to work abroad for at least one full tax year, you must inform HMRC. We can help with all your local and expat tax obligations and submissions.

 

Can UK Tax Specialists Also Help With UK US Dual Citizenship Taxes?

Yes! Taxes are imposed by the United States on its citizens regardless of where they live and how they earn their income. If you are a dual citizen living abroad, you might owe taxes to both the United States and the country where your income is earned. Contact us for more information.

 

What Are USA To UK Tax And Financial Services

These are core elements of the services Xerxes Associates LLP offer, including Tax Advice

Tax Planning and Tax Compliance Services ( i.e. US tax returns, UK tax returns and forms preparation).

 

Are Tax Advisors UK Or Those Who Offer Tax Return Services UK Regulated? 

As IRS Certified Acceptance Agents we are authorised to certify the required identification documentation for the purposes of applying for a US Individual Tax Identification Number (ITIN).

 

Do Xerxes Associates LLP Offer International Tax Advice For Individuals In The UK?

We have a team of experts and consultants that have experience in advising individuals on international tax matters. We are dedicated to providing our clients with custom-tailored services. No matter what your priorities and aspirations in business and life are, we will provide you with expert advice from local specialists. Due to the unique nature of your needs, our solutions are customised specifically for you.

 

Xerxes Associates LLP work closely with US and UK expats from all different backgrounds, circumstances and occupations as well as high-net worth individuals in order to help them through the complexities of US and UK tax compliance requirements (tax imposed on expatriates). If you have a query or would like a friendly no obligation chat about your requirements then please get in touch and we shall be happy to assist you.

Are you looking for US tax accountants and advisors in London or the UK?  View our fees and packages for UK and US tax return services.

FBAR Tax & PFIC 8621 Tax Forms Explained

FBAR Tax & PFIC 8621 Tax Forms Explained

What Is A FBAR And Who Needs To File One?

An FBAR form must be filed by all U.S. citizens, residents, corporations, partnerships, limited liability companies, trusts, and estates. The purpose of an FBAR is to notify a financial interest in a bank account including any type of authority over a financial account which is located outside the United States i.e. in the UK or any other country. Further information will be required before submitting the FBAR US tax form.

 

What Is Meant By PFIC Or Passive Foreign Investment Company?

PFIC (passive foreign investment company) is a corporation based overseas that exhibits either one of following two characteristics in regards to income or assets:

  • An organisation’s gross income must be at least 75% passive, meaning derived from investments or other sources apart from regular business operations.
  • Investments comprise at least half of the company’s assets and produce income through earned interest, dividends, or capital gains.

 

What Is The PFIC Tax Form 8621?

A shareholder of a passive foreign investment company or a qualified electing fund needs to file Form 8621 – please see above.

 

What Does Country Of Domicile Mean?

Domicile refers to the place where you maintain a permanent residence. In other words, your country of domicile is where you permanently reside. When you intend to remain in this place indefinitely, it becomes your domicile and you become its domiciliary.

 

What Is A US Expat?

American citizens who move and plan to stay in another country are called expats.

 

What Is The Equivalent Of The IRS In England?

The British equivalent of the Internal Revenue Service (IRS) is the HM Revenue & Customs (HMRC). The HMRC ensures that the taxation system is implemented and enforced effectively.

HMRC Or Her Majesty’s Revenue & Collections Is The Authority That Handles Tax Returns For The United Kingdom.

 

Xerxes Associates LLP work closely with US and UK expats from all different backgrounds, circumstances and occupations as well as high-net worth individuals in order to help them through the complexities of US and UK tax compliance requirements (tax imposed on expatriates). If you have a query or would like a friendly no obligation chat about your requirements then please get in touch and we shall be happy to assist you.

Are you looking for US tax accountants and advisors in London or the UK?  View our fees and packages for UK and US tax return services.

Expat Tax Advice: If You Received A Letter From The IRS, Here's What You Should Do

Expat Tax Advice: If You Received A Letter From The IRS, Here’s What You Should Do

The IRS sends millions of notices to taxpayers every year. Reasons for sending these letters vary. The following list contains ten simple steps you should take when this notice arrives.

1. It shouldn’t be ignored. The IRS mostly sends letters and notices in connection with federal tax returns. The letter or notice will tell you why the contact has been made and give you instructions on how to respond.

2. Don’t panic! It is usually sufficient to respond to the notice in a simple manner.

3. Read the entire document carefully and completely. IRS letters usually contain specific instructions and information about what you need to do to resolve a particular question or problem.

4. Make sure you have filed your taxes. The purpose of these letters is typically to inform the taxpayer of a change or correction to their tax return. Compare the information in the letter with the tax return.

5. Don’t reply unless it’s absolutely necessary. This type of notice is usually informational and does not need a response. If you have to respond, you will be told exactly what to do in the notice. Do not reply unless the notice asks you to or if payment is required.

6. In the event that you need to respond, do so immediately. Despite your disagreement, you should reply. Write a response letter that explains why you disagree, and send it to the address listed in the notice. If the IRS needs more information or copies of documents to consider your position, make sure to include it. You will then need to wait a minimum of 30 days to receive an IRS response.

A date on the notice usually indicates one of three things:

– To preserve the right of appeal for the taxpayer;

– To ensure that the tax return is processed in a timely manner;

– Minimise penalties and interest;

7. Call only when necessary. The IRS usually does not need to be contacted in most cases. Before you call, ensure that you have the relevant tax return and notice at hand.

8. Your IRS letter may have arrived late. Whenever you receive a notice with a due date and the due date has passed or is too close, you should contact the IRS immediately to inform them of the late receipt and request an extension of time to respond. For overseas taxpayers with unreliable mail services, this is of particular importance. A one-month extension from the IRS is usually given right away, but you must contact the IRS to get one.

9. Please keep the notice. Make sure to keep a copy of all IRS notices and letters.

10. Need help from a professional? If you need professional tax assistance, notify the IRS that you have hired an accounting firm to assist you, and you would like time to allow your representatives to assess and respond on your behalf.

Xerxes Associates LLP work closely with US and UK expats from all different backgrounds, circumstances and occupations as well as high-net worth individuals in order to help them through the complexities of US and UK tax compliance requirements (tax imposed on expatriates). If you have a query or would like a friendly no obligation chat about your requirements then please get in touch and we shall be happy to assist you.

Are you looking for US tax accountants and advisors in London or the UK?  View our fees and packages for UK and US tax return services.