You think your tax-filing days are over when you hop across the English Channel as an expat American in the UK. Think again. The US is a strange country where it taxes individuals on the basis of citizenship, and not residence. So, you still need to report your income to the IRS — even if you’ve been gone for decades.
It may be daunting to prepare US taxes in the UK, but knowing your duty as an expat is the only thing that is needed in order to remain in good standing and avoid paying large penalties.
Are US Expats in the UK Required to File?
Yes — U.S. citizens, green card holders, and resident aliens who meet certain qualifications must report an annual federal tax return to the IRS if they are above the minimum income levels, no matter where they reside.
For 2023 (report in 2024), the minimum reporting requirements were:
- $13,850 if single and under age 65
- $27,700 if filing jointly
- $5 for self-employment (yes, five dollars)
You’re earning in London, receiving a full wage, and paying taxes in the UK — but you still need to file a U.S. tax return.
Essential Reminders for Expats When Filing US Taxes from the UK
As an expat living abroad, your U.S. tax return may be filled with extra forms and complexity beyond the standard Form 1040.
This is what usually applies:US
1. Foreign Earned Income Exclusion (FEIE) – Form 2555
This allows you to exclude a maximum of $120,000 (2023) of foreign earned income from U.S. tax. To qualify, you will have to meet either:
- The Physical Presence Test (330 days outside the UK within 12 months)
- The Bona Fide Residence Test (a whole tax year in the UK)
Exclusion is limited to earned income — not investment income, passive income, or pensions.
2. Foreign Tax Credit (FTC) – Form 1116
Rather than offsetting income, you can deduct a dollar-for-dollar amount for tax paid to HMRC in the UK. This is generally preferable if you are above the FEIE limit or pay a high tax rate in the UK.
Proviso: You cannot claim FEIE and FTC on the same income.
3. FBAR (Foreign Bank Account Report) – FinCEN Form 114
If at any point in the year you have over $10,000 combined in all foreign accounts, you are required to file an FBAR. They include:
- UK bank accounts
- ISAs
- Foreign pensions
- Investment accounts
Fines for non-filing can be enormous — up to $10,000 per infraction or more if willful.
4. FATCA Reporting – Form 8938
Filing US taxes in the UK may also involve filing foreign financial assets. For FATCA, if you hold more than $200,000 (single) or $400,000 (married) of foreign assets, you need to file Form 8938.
Tax Treaties: US and UK Cooperation
The US and UK have a tax agreement and a totalization agreement. These do not exempt you from filing, but:
- Minimize double taxation
- Make it clear which country has taxing rights over pensions, social security, and self-employment
- Avoid dual contributions to both countries’ social security systems
However, treaties are complex and should be handled carefully. Many benefits aren’t automatic — they must be claimed on your return.
When Are U.S. Taxes Due for Expats?
| Deadline | What It Covers |
| April 15 | U.S. tax filing due date |
| June 15 | Automatic 2-month extension for expats |
| October 15 | Final extension deadline if requested |
| October 15 | FBAR filing deadline (automatic extension) |
Although expats have until June 15 to submit penalty-free, taxes due are still due on April 15. Interest thereafter applies.
What If You Haven’t Been Filing?
You’re not the only one. Expats are unaware that they have a continuing tax obligation. The better news? The IRS has an amnesty route with the Streamlined Foreign Offshore Procedures.
The program enables qualified taxpayers to:
- File the last 3 years of tax returns
- File 6 years of FBARs
- Avoid penalties for late filing
Your non-compliance with the rules has to be non-willful — i.e., you weren’t aware you needed to file.
How to File US Taxes in the UK
There are three primary methods of doing so:
1. Utilize Expat-Friendly Tax Software
Some sites are designed specifically for Americans living overseas. Make sure software allows you to file Form 2555, 1116, FBAR, and FATCA.
2. Hire an Expat Tax Specialist
If your finances are complex (multiple incomes, pensions, investments, business proprietorship), it can spare you precious time and risk to hire an expert.
3. IRS Free File
If your income level is under $79,000 and your tax situation is straightforward, you may be eligible to prepare for free using IRS-certified software — but expat options are limited.
FAQs: Filing US Taxes from the UK
Do I actually have to file if I already pay tax in the UK?
Yes. America taxes on citizenship, not on residence. But tax credits and exclusions generally avoid twin taxation.
FEIE keeps money out of tax, and FTC allows you a credit for tax you’ve already paid to the UK. You have to decide on the basis of what is best for you.
Is my U.K. pension taxable in the U.S.?
Yes. The IRS treats most U.K. pensions as taxable, though tax treaties can influence if and when you need to file.
Do I need to report my U.K. bank account?
Yes, if the total balance of all foreign accounts ever held at any time during the year exceeds $10,000, you must report an FBAR.
What if I haven’t filed for years?
You could be eligible for the IRS Streamlined Filing Compliance Procedures to return to compliance penalty-free — but only if the IRS hasn’t already contacted you.
Final Thoughts
It’s not optional to report US taxes in the UK — and it may cost you in penalties, interest, and even disqualification from renewing your passport. But the American tax system is also designed to protect Americans abroad with exclusions, credits, and treaties that can prevent them from being taxed twice.
Whether you’ve been an expat in the UK for a long time or are fairly new to it, complying is simpler if you know what your obligations are and seek appropriate assistance. Life at the border complicates tax, but by planning ahead and seeking expert advice, you can avoid getting into hot water and be in control of your destiny.
