As a US Person, setting up your financial life in the UK can be complex – even knowing the questions to ask can be difficult. Moving abroad can be overwhelming and not having professional advice when it comes to your financial matters can be costly, especially when dealing with two tax jurisdictions.
Every person’s life situation looks different and there is not a “one size fits all” solution when it comes to moving to the UK. Asking these 6 simple questions can serve as a roadmap to setting up your financial life in the UK:
Have you relocated to the UK yet?
Pre-move planning can be the most effective and efficient! If you have not relocated to the UK yet, there may be planning opportunities to complete prior to becoming a UK tax resident that could save you money and excess taxation. Get in touch sooner rather than later. If you have already moved, don’t worry, it is not too late. There are plenty of planning items to accomplish once you’ve moved to the UK and on an ongoing basis – speak to a Tanager Advisor to learn more.
What type of US assets do you have?
Do you have an old or current 401k plan or any type of US retirement plan? Do you have a taxable brokerage account in the US? Are you perhaps sitting with large cash balances at a bank? Speaking to an advisor about your existing US assets is one of the first places to start – we want to ensure your US assets are the most tax efficient as possible from a US/UK perspective while still playing an important part in your investment and financial plan.
Do you have UK based assets? If so, how are they comprised?
Even if you’ve only been in the UK for a short period of time, you may have started the process of setting up UK account structures and maybe you’re even contributing to them. Perhaps you have a workplace pension or maybe you decided to setup an ISA or a General Investment Account. As a US person in the UK, you still have IRS filing requirements each year. It is important to make sure that your UK assets aren’t creating a tax problem or inefficiency on your US tax return. What types of accounts you have and what you hold within those accounts matters.
Are you planning to stay in the UK or move back to the US?
Uncertainty in future plans is quite common and isn’t always a bad thing. Having a flexible financial plan will allow you to have maximum flexibility when deciding how long you anticipate living in the UK. Flexibility is optimised when investing and structuring your assets in a way that is tax efficient from a US and UK perspective.
Do you have a financial plan in place that incorporates your new life in the UK?
Don’t neglect your goals and your financial plan! Just because your financial life may have an added layer of complexity, doesn’t mean you should neglect setting goals and having a financial plan in place. Maybe you wish to buy a home in the UK some day, or perhaps you want to raise a family or maybe you’d like to start a small business. Whatever your goals may be, talking about them with a Financial Advisor who understands the US/UK complexities is important.
Do you have a network of professional advisors that are helping you with your transition?
Working with a Tanager Financial Advisor, a dual qualified accountant and a solicitor who specialises in US/UK estate planning can help to ensure that you are taking all the proper steps in seamlessly setting up and maintaining your life in the UK. Working with these individuals will give you the peace of mind that you are optimising your new UK life.
While this certainly isn’t an all-inclusive list of the questions to ask or the potential complexities you may face, this will help you get off to the right start. Having a financial plan in place will give you the peace of mind you deserve when moving your life abroad. We are here to help! Connect with a Tanager Financial Advisor today and start the conversation.
This is not advice or a recommendation. You should consult with your tax attorney and accountant to determine whether any of these actions are appropriate in your personal circumstances.
Certain investments carry a higher degree of risk than others and are, therefore, unsuitable for some investors. Past performance is not a reliable indicator of future results. The value of investments, and the income from them, can go down as well as up, and you may not recover the amount of your initial investment.