1. Why do I still need to file a US tax return if I live outside the United States?

The United States taxes US citizens and certain resident aliens on their worldwide income, even if they live abroad. This means that moving to the UK, or another country, does not automatically end your US tax filing obligations.

You may still need to report wages, self-employment income, pensions, interest, dividends, capital gains, rental income and other income, even where the income is already reported to HMRC or another tax authority.

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2. Why are all the figures on my US tax return shown in US dollars?

US tax returns are prepared in US dollars. If your income, tax, pension contributions, bank balances or investments are in pounds sterling or another currency, those figures need to be converted into US dollars.

This is one reason why your US return will not look identical to your UK tax return, P60, payslip, SA302, investment statement or bank statement.

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3. What exchange rate is used on my US tax return?

Different exchange rates may be used depending on the type of item being reported. For example, regular salary may be converted using an annual average rate, while a one-off sale, dividend, pension payment or capital gain may require a rate closer to the transaction date.

For FBAR reporting, the maximum account value is generally converted into US dollars using the appropriate year-end Treasury exchange rate or another acceptable rate where necessary.

Because different rates may be used for different purposes, the converted figures may not match exactly across every form.

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4. Why are the numbers on my US return different from my UK tax return?

The US and UK tax systems do not calculate income in exactly the same way. Differences can arise because of:

* Different tax years
* Different exchange rates
* Different rules for pensions
* Different treatment of ISAs and investments
* Foreign tax credit calculations
* Timing differences between when income is taxed in the UK and the US
* Differences between gross income, net income and taxable income
* US reporting forms requiring information that is not needed on a UK return

A difference does not automatically mean that either return is wrong. It often simply means the two systems are measuring the same facts in different ways.

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5. Why does my US tax return not match my P60 or payslips?

A P60 is a UK document and is prepared under UK payroll rules. A US tax return may use calendar-year figures, US dollar conversions, treaty positions, foreign tax credit calculations and other adjustments.

This means your US wages, foreign tax credits and other figures may not match your P60 or payslips line by line.

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6. What is the FBAR?

The FBAR is the Report of Foreign Bank and Financial Accounts, also known as FinCEN Form 114.

It is used to report certain non-US financial accounts where the total maximum value of all reportable foreign accounts exceeds $10,000 at any time during the calendar year.

The FBAR is filed separately from the US tax return and is not itself a tax calculation.

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7. Does filing an FBAR mean I owe US tax?

No. The FBAR is an information report. Filing an FBAR does not, by itself, create a US tax liability.

However, the income generated by the accounts, such as interest, dividends, capital gains or pension distributions, may still need to be considered on your US tax return.

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8. What accounts may need to be included on the FBAR?

The FBAR can include many types of non-US financial accounts, including:

* Current accounts
* Savings accounts
* Joint accounts
* Investment accounts
* Brokerage accounts
* Certain pensions
* Accounts where you have signature authority
* Some business or company accounts, depending on the facts

The FBAR is based on whether the account is reportable, not whether the account produced taxable income.

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9. Why do you ask for the maximum value of each account?

The FBAR is based on the highest value of each reportable account during the calendar year, not just the balance at 31 December.

This is why we may ask for the maximum balance, even where the account was only above a certain amount for a short period.

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10. Why are the numbers different between the FBAR and Form 8938?

The FBAR and Form 8938 are separate reporting requirements. They have different rules, different thresholds and different definitions of what must be reported.

Some accounts may appear on both forms. Some may appear on only one. Some assets may be relevant for Form 8938 but not the FBAR.

It is therefore normal for the FBAR and Form 8938 not to match exactly.

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11. What is Form 8938?

Form 8938 is the Statement of Specified Foreign Financial Assets. It is attached to the US tax return when the taxpayer holds specified foreign financial assets above the relevant threshold.

For taxpayers living abroad, the thresholds are generally higher than for taxpayers living in the United States. Whether Form 8938 is required depends on filing status, residence position and the value of the assets.

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12. Is Form 8938 the same as FATCA?

Form 8938 is part of the FATCA reporting regime for individuals. FATCA is also the reason many non-US banks ask US citizens and green card holders to complete US tax forms or confirm their US status.

The bank reporting under FATCA and your own Form 8938 reporting are related, but they are not the same thing.

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13. Do I need to report my UK ISA on a US tax return?

Often, yes. An ISA is tax-free in the UK, but it is not automatically tax-free for US tax purposes.

Income, dividends, capital gains and investments inside an ISA may still need to be reviewed for US tax and reporting purposes. Stocks and shares ISAs can be particularly complicated where they contain non-US funds.

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14. Are UK pensions reportable in the US?

UK pensions often need to be considered for US tax and reporting purposes. The treatment depends on the type of pension, whether contributions were made, whether the pension is employer-sponsored or personal, whether distributions were received, and whether treaty relief is available.

Pensions can also be relevant for FBAR and Form 8938 reporting, depending on the facts.

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15. Will I be taxed twice by the US and the UK?

Many taxpayers do not pay full tax twice because foreign tax credits, exclusions and treaty provisions may reduce or eliminate double taxation.

However, double taxation can still arise in some cases, especially where the US and UK tax the same income at different times or classify the income differently.

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16. What is the foreign tax credit?

The foreign tax credit is a mechanism that may allow US taxpayers to claim credit for foreign tax paid on income that is also taxed by the US.

For UK residents, this often means UK tax paid to HMRC may reduce the US tax due on the same income. The rules are technical and depend on the type of income, the year the tax relates to, and whether the foreign tax is creditable for US purposes.

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17. What is Form 2555 and the foreign earned income exclusion?

Form 2555 is used to claim the foreign earned income exclusion and, where applicable, the foreign housing exclusion or deduction.

This can allow some taxpayers abroad to exclude a portion of foreign earned income from US tax. However, it does not apply to all types of income. For example, it does not generally apply to pensions, investment income, rental income or capital gains.

In some cases, the foreign tax credit may be better than the foreign earned income exclusion, so the best approach depends on the taxpayer’s circumstances.

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18. Where is my IRS refund?

IRS refunds can take longer where a return is filed by paper, includes international issues, requires manual processing, is selected for additional checks, or includes items the IRS system cannot process automatically.

The IRS refund tracker is generally available sooner for e-filed returns than for paper-filed returns. For paper returns, it may take several weeks before the return appears in the IRS system at all.

A delay does not automatically mean the return has been lost or prepared incorrectly.

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19. Why was my US tax return filed by paper rather than e-filed?

In some cases, US returns prepared by non-US based preparers may need to be filed by paper where IRS e-file access is unavailable, restricted or the specific return cannot be accepted electronically.

Paper filing means the IRS must process the return manually. This can significantly increase processing time, especially during busy filing periods or where the return includes international forms.

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20. Should I send another copy of my US tax return if my refund is delayed?

Usually, not immediately. Sending a duplicate paper return too soon can sometimes create further confusion or delay.

If enough time has passed and there is still no evidence that the IRS has processed the return, we can consider the best next step. This may include checking transcripts, reviewing IRS refund tools, responding to notices, or sending further correspondence where appropriate.

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21. Why did I receive an IRS notice after filing?

IRS notices can be issued for many reasons. They may relate to payments not being matched, paper returns not yet being processed, missing forms, identity checks, estimated tax issues, foreign tax credit differences, or IRS system errors.

An IRS notice does not automatically mean your return was wrong. It should be reviewed carefully before any payment is made or response is sent.

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22. Can EDA call the IRS for me?

In some cases, a tax adviser can speak to the IRS with the correct authorisation in place. However, IRS phone access can be slow and not every issue can be resolved by telephone.

For many international cases, written correspondence, transcript review or formal responses may be more reliable.

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23. Can EDA make IRS or HMRC payments for me?

No. Clients should make tax payments directly to the relevant tax authority.

We can advise on the amount, payment reference and payment method, but we do not handle client tax payments or hold client money.

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24. What if I have not filed US tax returns for several years?

There may be options to catch up, depending on your circumstances. Some taxpayers may qualify for the IRS Streamlined Filing Compliance Procedures if their failure to file was non-wilful.

The correct approach depends on your filing history, residence position, income, foreign accounts, tax due and whether there is any risk of wilful non-compliance. This should be reviewed carefully before filing late returns.

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25. Do green card holders have US tax filing obligations?

Yes. A green card holder may still be treated as a US tax resident unless their status has properly ended for US tax purposes.

Simply leaving the United States does not always end US tax obligations. Green card holders should take advice before assuming they are no longer required to file.

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26. Can I just renounce US citizenship to stop filing US tax returns?

Renouncing US citizenship is a serious legal and tax decision. It may involve final US tax filings, expatriation reporting and possible exit tax analysis.

It should not be treated as a quick fix for missed filings or ongoing tax obligations. Legal and tax advice should be taken before making any decision.

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27. What song explains US tax for Americans moving abroad?

We sometimes describe the US tax system for Americans abroad as the “Hotel California” problem. Without quoting the song, the idea is that leaving physically does not always mean you have fully checked out of the US tax system.

For US citizens and certain green card holders, moving abroad does not automatically end US filing obligations. The tax position needs to be reviewed properly.

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28. What documents should I send each year?

The documents needed depend on your circumstances, but common items include:

* W-2s and 1099s
* UK P60s and P45s
* UK self-employment or company accounts
* UK tax return and tax calculation
* Bank interest statements
* Dividend and investment statements
* Pension contribution and pension distribution details
* Rental income and expenses
* Mortgage interest statements
* Details of foreign tax paid
* Maximum values of non-US financial accounts
* Details of ISAs, pensions and investment accounts
* Travel dates where residence or treaty position is relevant

Providing complete information at the start helps reduce delays and follow-up questions.

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29. When should I contact EDA each year?

Ideally, you should contact us once the relevant UK and US tax documents are available, but before the US extension deadlines.

You should contact us earlier if you have moved country, sold property, received pension payments, started self-employment, bought or sold investments, received inheritance, opened new accounts, formed a company, or missed prior-year US filings.

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30. Why do you need so much information?

US international tax reporting is detailed. The US return may require information that is not needed for a UK tax return, including foreign account values, pension details, investment holdings, foreign tax paid, entity ownership, residence dates and exchange rate calculations.

We ask for this information so that the return and related forms can be prepared correctly and consistently.

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Need help with US tax abroad?

EDA Professional Services assists US citizens, green card holders and other US taxpayers living abroad with US tax returns, FBARs, Form 8938, foreign tax credits, UK/US treaty issues and late filing catch-up work.

Please contact us if you would like help reviewing your US filing position.