Personal Financial Management

[rjm_cmyk 75]

Anyone know of any web resources concerning personal finances for the expat ? As a Brit I'm thinking about things like payment of state pensions , personal pensions , managing tax affairs and possibly even UK earnings after I emigrate.

Just wondering if anyone knew of any sites or books that might be useful ?

Such as this - http://www.hmrc.gov.uk/international/leave-uk.htm

Edited January 21, 2013 by rjm_cmyk

[TimeTravel 78]

You can check out Mint.com to see if it can be helpful for you.

[Owen_London 65]

One of the things I wanted to do before I moved was to sort out my finances so they were simplified and in the right place. Three months after the move, I still haven't finished, but I've made progress.

I did quite a bit of reading on the internet. The best option for some investments is to simply move them to the US, though you can't do that for a personal pension. One forum where I found some useful info is here, though I've never registered there: http://britishexpats.com/forum/forumdisplay.php?f=57

A few other notes:

- ISAs are not recognised as tax-free by the IRS, and they will tax them.

- I've seen several threads asking how to convert UK personal pensions into US 401k, and the few people who seem to know what they're talking about say that it's impossible.

[Nich-Nick 3,354]

I just want to add a tip

Before you leave, figure out how much income you earned in the UK from Jan1 until you quit work. You will be able to file a joint tax return with your USC spouse for tax year 2013 but will have to claim your joint worldwide income. Your UK income can be excluded from taxation but you will report the amount. It is self reported but figure it out before you toss your pay slips or bank statements. Better yet, bring those things that show 2013 income with you.

[rjm_cmyk 75]

Thanks for the tips guys. Not seen that much discussion on here about personal finance which I've thought a little odd but perhaps I'm just a bit OCD.

[Owen_London 65]

I just want to add a tip

Before you leave, figure out how much income you earned in the UK from Jan1 until you quit work. You will be able to file a joint tax return with your USC spouse for tax year 2013 but will have to claim your joint worldwide income. Your UK income can be excluded from taxation but you will report the amount. It is self reported but figure it out before you toss your pay slips or bank statements. Better yet, bring those things that show 2013 income with you.

That's not quite true. Most UK income will be covered by the joint tax treaty, but some UK tax-free investments are not recognised as such by the IRS. ISAs are one example, but there are others.

There is also the "foreign earned income exemption", but I think that only applies for those who are married but not currently tax-resident in the USA, and on this forum I think that would only apply for those going the CR1 route, who got married and then didn't enter the US until the following tax year. I could be wrong about that, though.

[Nich-Nick 3,354]

That's not quite true. Most UK income will be covered by the joint tax treaty, but some UK tax-free investments are not recognised as such by the IRS. ISAs are one example, but there are others.

There is also the "foreign earned income exemption", but I think that only applies for those who are married but not currently tax-resident in the USA, and on this forum I think that would only apply for those going the CR1 route, who got married and then didn't enter the US until the following tax year. I could be wrong about that, though.

I was addressing the OP, a K1 who will marry a US citizen in 2013. If he wants to file jointly with his new wife, they will report worldwide income on the 2013 tax return. He will fill out IRS Form 2555 or 2555EZ foreign income exclusion, but he will have to know what he earned worldwide and report it on the 1040 and the 2555. Positive that is correct. Even if he does not have a greencard in 2013, he can file jointly with his wife, which is most often the best scenario. That will be a year from now when they file, so thus the tip to make note of 2013 income before you throw out paperwork.

Edit to add: that is assuming he makes it to the US and marrys in 2013.

Edited January 22, 2013 by Nich-Nick

[Owen_London 65]

I was addressing the OP, a K1 who will marry a US citizen in 2013. If he wants to file jointly with his new wife, they will report worldwide income on the 2013 tax return. He will fill out IRS Form 2555 or 2555EZ foreign income exclusion, but he will have to know what he earned worldwide and report it on the 1040 and the 2555. Positive that is correct. Even if he does not have a greencard in 2013, he can file jointly with his wife, which is most often the best scenario. That will be a year from now when they file, so thus the tip to make note of 2013 income before you throw out paperwork.

Edit to add: that is assuming he makes it to the US and marrys in 2013.

I think we're talking at cross purposes, sorry. The bit I was disagreeing with was "Your UK income can be excluded from taxation". Some UK income cannot be excluded, since the IRS doesn't recognise the related UK tax concessions as being covered by the dual taxation treaty.

[rjm_cmyk 75]

Thanks guys.....

Really basic question - how does the US tax year run - calendar or odd like in the UK ? I expect/hope to be in the US by the Autumn/Fall so will legally marry in 2013

[Nich-Nick 3,354]

I think we're talking at cross purposes, sorry. The bit I was disagreeing with was "Your UK income can be excluded from taxation". Some UK income cannot be excluded, since the IRS doesn't recognise the related UK tax concessions as being covered by the dual taxation treaty.

Ok, I' m talking about earned income from a job for the average bloke who is going to marry an American. If the American has capital gains, that calculation is affected by total worldwide income too, so it's not always a simple report it and subtract it all in every case. Sorry I commented. It wasnt meant to be an all inclusive tax seminar.

Let's edit my poorly worded tip to:

United Kingdom K1s--bring all your foreign employment earning records and financial records from Jan 1 of the year you immigrate in case you need them for US tax filing at the end of that year. Is that valid?

[Owen_London 65]

Ok, I' m talking about earned income from a job for the average bloke who is going to marry an American. If the American has capital gains, that calculation is affected by total worldwide income too, so it's not always a simple report it and subtract it all in every case. Sorry I commented. It wasnt meant to be an all inclusive tax seminar.

Let's edit my poorly worded tip to:

United Kingdom K1s--bring all your foreign employment earning records and financial records from Jan 1 of the year you immigrate in case you need them for US tax filing at the end of that year. Is that valid?

Sure, that works for me, though I'd actually replace "UK K1s" with "Immigrants".

And rjm: Yes, the US tax year is a calendar year. Technically, it is possible to agree with the IRS to use different timing, but that's very unusual.