Financial Advice for Expats in the United States

Living in the US as an expat presents complex financial challenges, from navigating dual-tax obligations to managing pensions across borders. Our independent wealth managers provide expat-focused solutions, helping you comply with IRS, HMRC, and SEC rules while optimising your investments, pensions, and tax position. Whether you’ve recently relocated or are working or retired in the US, bespoke planning is essential to avoid pitfalls.

The United States tax system includes federal and state income tax. As a tax resident, you’ll typically be taxed on your worldwide income and assets, including wages, investments, pensions, and rental properties.

The Internal Revenue Service (IRS) determines residency using the ‘green card test’ or the ‘substantial presence test’. This means that you will usually be considered a tax resident if you are either a green card holder, and therefore a lawful resident, or spend most of your time in the US. 

Expats who are not permanent residents and who don’t have a Social Security Number (SSN) will still need to register for an ITIN (Individual Taxpayer Identification Number) to file their returns.

Federal income tax is progressive, with current rates ranging from 10% to 37%, while state taxes vary. Some states, such as Florida and Texas, do not levy additional income tax, while others, like California and New York, apply higher rates.

Our independent financial advisers in the US help expats calculate their tax liabilities, avoid penalties, and leverage available allowances and UK–US tax treaties to prevent double taxation.

The UK–US tax treaty is an agreement designed to prevent double taxation on the same income or event, and sets out the rules that dictate where an income or asset should be taxed. For example:

• US tax residents will generally pay American tax rates on UK pension incomes, including lump sums that may have been tax-free in the UK.
• Some forms of income, such as UK dividends, may be subject to reduced US withholding tax rates provided the appropriate forms are submitted. 
• Expats can submit a Treaty-Based Return Position Disclosure called IRS Form 8833 to claim treaty benefits.

Our US wealth management team can, of course, provide more guidance about the best ways to ensure your tax reporting is accurate and takes advantage of all treaty provisions that can reduce your tax liability.

Decisions about how to manage your pension as an overseas expat are complicated and will always depend on your circumstances and the value of your funds. While it isn’t possible to directly transfer a UK pension scheme into a US retirement account such as an IRA or 401(k), we can advise on:

• Alternatives such as consolidating your pensions into a Self-Invested Personal Pension (SIPP) and other  international pension structures
• The tax implications of receiving your pension in the US and the impacts on your retirement planning
• Strategies that can minimise US tax obligations on lump sum payments
• Different transfer solutions, including ROPS, where applicable, and repatriation planning if you intend to relocate in the future

Pension planning is always based on your domiciliary and residency position, age, and income profile.

Yes. If you are a legal US resident or become a citizen, you must report overseas accounts if they exceed $10,000 at any time during the year. These disclosures can be made by submitting:

• A Foreign Bank and Financial Accounts (FBAR) declaration via FinCEN Form 114
• Foreign Account Tax Compliance Act (FATCA) disclosures using Form 8938

Failure to report foreign accounts can result in severe penalties, and our financial advisers will help you remain compliant with all cross-border disclosure requirements.

There is no federal inheritance tax in the United States, but six states —Iowa, Kentucky, Maryland, Nebraska, New Jersey, and Pennsylvania—impose local inheritance taxes.

However, estate taxes may still apply at a federal level for estates valued above $13.99 million as of 2025. For expats with cross-border assets, it is essential to determine how both the UK and US inheritance tax rules will apply.

Our full-service wealth management team helps you structure your estate using US and UK-compliant planning tools to minimise tax exposure, protect your heirs, and ensure your wealth is distributed according to your wishes.

Typically, UK pension contributions are not possible once you become non-resident, but there are considerations as follows:

• You may still be eligible to receive benefits from pension funds such as Self-Invested Personal Pensions (SIPPs)
• New contributions made to your pension funds may mean you require  an income that is taxable in the  UK
• The US tax treatment of pension contributions varies from that in Britain, and bespoke guidance is advisable to ensure you know the most tax-efficient way to manage UK-located retirement funds

We can help clients evaluate the best way forward, whether to consolidate pensions, retain UK schemes, or explore products such as international SIPPs that offer enhanced flexibility and control.

US tax law does not recognise UK-specific products that offer British tax exemptions, including ISAs and Premium Bonds. This means that:

• ISA dividends, interest, and capital gains are fully taxable in the US
• Premium Bond winnings must also be declared

Our financial solutions can extend to restructuring your UK savings assets to ensure they are optimised and reinvested to maximise returns within the US tax environment.

Expats in the US must be conscious of the reporting requirements in the US linked to FATCA and PFIC rules, given the additional compliance requirements in place. We can offer advice around:

• Offshore investment platforms and customised advisory accounts
• Tax-efficient portfolio structuring to adhere to PFIC requirements
• Ongoing investment reviews focused on growth and  cross-border compliance

Our independent advisers can assist in investment selection and ensure your assets are diversified, compliant, and aligned with your financial goals.

Capital gains tax in the US applies to worldwide taxable gains for tax residents, although Foreign Tax Credits may apply if the asset is based overseas. The exact rate of tax will also depend on the amount of time you have held the asset before realising a gain:

• Short-term assets held for less than one year are taxed at the regular income rates
• Long-term assets are subject to capital gains of between 0% and 20% depending on your taxable income
• State-specific capital gains taxes may also apply

The sale of cross-border assets such as UK-based property or shares may trigger US and UK capital gains obligations, which means that treaty reliefs should be applied to avoid double taxation.

The healthcare system in the US is considerably different from that in the UK, given that there is no national health service. Expats must arrange comprehensive medical insurance and usually need to provide evidence of this to comply with the terms of their visa or permit. Expats will normally need to:

• Purchase robust private health insurance and dental coverage
• Review their potential eligibility for Medicare, while noting that the federal health insurance scheme is unavailable to most new expats
• Consider global health plans designed specifically for expatriates 

Health insurance costs include monthly premiums, co-pays against treatments received, and deductibles, with emergency or specialist care often carrying high fees. We can assist with private medical cover comparisons and advice on planning for health-related costs in retirement.

Currency fluctuations between GBP and USD can have a significant impact on pensions, transfers, and investments, which is why careful structuring of your assets and timings when transferring or drawing on funds between the UK and the US is so important. We can assist with:

• Currency hedging and foreign exchange risk reduction strategies
• Suggesting international investment platforms that offer multicurrency accounts
• Cross-border income planning

Our advisers are here to help manage your financial accounts to avoid unnecessary exchange rate volatility.

Possibly, yes, although this will depend on how your circumstances mean you are categorised via the UK’s Statutory Residence Test (SRT). Dual residency can complicate your tax position and mean that:

• You may be liable to submit UK tax returns, even if you pay tax in the US
• Treaty tie-breaker rules will need to be used to  determine your residency status for tax purposes

Chase Buchanan’s expat specialists can analyse your situation and provide further advice on residency planning, with in-depth knowledge of the intricacies of residency evaluations such as split-year treatments.

Expats who own homes in either country must be aware of the respective tax obligations arising, which include:

• US property taxes, which vary by state, and capital gains taxes on the sale of real estate assets
• UK capital gains taxes, income tax on rental income and council tax

We can recommend the best ways to ensure property ownership is tax-efficient and assist in managing reporting obligations in both jurisdictions.

The EB-5 visa is a US program that may be appropriate for expats planning to relocate permanently. It offers a potential route to permanent residency through investments of at least $800,000 in Targeted Employment Areas, or $1.05 million elsewhere. Investments must be made into a new business venture that creates at least ten full-time jobs.

The investment must remain in place for at least two years, and the business must be commercially viable. The EB-5 pathway can lead to permanent residency and onward citizenship, and our advisers can assess your eligibility, outline alternative routes, and help you coordinate your tax strategy to align with US investment-based immigration.

Expats who have recently relocated to the US will not usually have an SSN immediately, because in most cases, you become eligible to apply for an SSN once you become a long-term resident, take up an employment position or become a citizen. However, you will need to apply for an Individual Taxpayer Identification Number (ITIN) through the IRS.

An ITIN is necessary for anyone who needs to file US tax returns, open some types of investment accounts, and comply with reporting obligations.

Our cross-border tax specialists can assist with your ITIN application, ensure you’re meeting all IRS filing requirements, and guide you through early-stage relocation administration to avoid delays or penalties.