I am a dual UK/US citizen. I wasn't born in the US but mom and dad were both Americans. Should I renounce US citizenship or leave the UK?
They both died some years back. The bank I am with is asking me to sign self-certification forms about my tax residency and liability to pay US taxes and file paperwork. Said bank is not happy since after searching their records they think mom and dad evaded their US tax responsibilities. My financial advisor believes that I'd be better off renouncing my US citizenship or moving to the US permanently if I want better financial security.
What are your thoughts on this. Should I renounce my US citizenship, or move to the US. Which would be better?
And which country do you believe has a better future?
- Brother HesekielLv 78 months ago
You should not renounce your US citizenship, worth about $1M, and you should not again smoke acid drugs. Looks like the last time you did that, it caused some brain damage.
Whether you want to live in the UK or in the US depends on many things. Generally speaking, the EU will implode within the next decade, whereas the US will thrive, as long as no crazy Democrat-Socialists try to change the American way of life. Just watch the currency exchange rate and the predictions for the coming years, and there's all you need to know. In addition, part of the UK already look like India, which makes me very sad, and I like India a lot.
I know of course that the UK cut itself off the EU, but I'm afraid it won't prevent it from being dragged down by the suffering EU economy.Source(s): An immigrant from Europe, I live on the American Riviera and work as an attorney in Santa Barbara, California.
- FoofaLv 78 months ago
No one here can know what kind of life you've built for yourself in the UK. Obviously if you're happy there and have a great job it probably makes no sense to consider moving to the US. But, yes, the US laws pertaining to the taxation of expats is the single most motivating factor in people renouncing their US citizenship.
- ObserverLv 78 months ago
This is a legal issue and I would be talking to an immigration attorney not people on a web site that probably have no idea what you are talking about.
- 8 months ago
First thing to check is if you actually have both citizenships. What passports do you physically have?
You are only certainly a British citizen if you were born in the UK prior to 1983. After that time you are only British if one of your parents had British citizenship or settled status.
You are only a US citizen if your parents submitted a consular report of a US citizen's birth abroad before you were 18 years old.
But let's suppose for the sake of argument that you are a passport carrying citizen of both countries. There are no downsides to holding British citizenship. US citizenship really only two drawbacks; one is that non US banks hate 'US person' customers because of FATCA regulations and the other is that you have to file a US tax return every year (although many thousands of US citizens residing outside the US do not).
You do not explain how your British bank came to think you were a 'US person'. Mine certainly has no clue and they have never asked but the work-around is to keep less than £10,000 in your account to avoid FBAR reporting requirements.
With respect to the filing of US tax returns, this is not onerous. You can file a non resident tax return on line. The double taxation treaty between the two countries means that you will only owe if you sell your UK principal residence as you will be liable for US CGT.
Personally I would never get rid of a citizenship. It gives you more options. I have three, that is a perfect number because it allows me to truthfully answer 'no' to the question 'are you a dual citizen' which is in any case a very stupid question as nobody is dual anything.
So to the final part of your question; which country has the better future. Sorry, my crystal ball is at the repair shop currently. Can't help you on that one. If I had to chose a single place with a fascinating past and an exciting future, it would be India. But I don't think India wants me so I'll stick with what I have.
Hope that helps!
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- ibu guruLv 78 months ago
You face a common problem for Americans & dual-nationals living outside the US. Many banks now refuse to open or maintain accounts for Americans (or duals) due to onerous US reporting requirements on accounts. Also, all American citizens, legal permanent residents, persons staying/working in US, and certain other "US persons" as defined in law must file US income tax returns, regardless where they live. US taxes all income from all sources worldwide, regardless where you live.
You could have been born & residing in UK your entire life, and you still have to file US income tax returns annually. You may also be subject to FBAR (report of foreign bank accounts, now FinCEN Form 114), and Form 8938 (report of foreign assets), and penalties for failure to file as required and ON TIME are downright draconian.
There may be some concerns your parents failed to file annual income tax returns while they were still alive. But since they are both deceased, you probably have no way of checking on that now anymore. Of immediate concern is whether you have filed annually for your entire life. Certainly if you have been failing to file, you don't ever want to think about attempting to enter the US!
As for renunciation, do you really have ties to US, intentions to live in the US, etc? Or are your family, friends, ties, job, property, etc, all in UK? No good reason to keep US citizenship if you lack ties or commitments to US. Renunciation is expensive, but after taking oath of renunciation AND actually receiving your Certificate of Renunciation, you no longer are subject to IRS filing & paying requirements. And you solve your problem with your bank.
- W.T. DoorLv 78 months ago
Both the UK and the USA accept dual/multiple nationality so there is no reason for you to renounce either citizenship. Do NOT listen to your "adviser" who wants you to renounce US citizenship. I think you need a new adviser.
There is nothing complicated about filing US taxes from abroad, and I have done it off & on for 16 years. Your first US$100,000 is exempt from US taxes and you get credit for foreign income taxes you have to pay if you make more than $100,000/year.