Does anyone know how to denounce their British Citizenship

[Leaannb]

My 18 yo who is a dual citizen of the UK and US would like to denounce his British citizenship due to tax reasons. Any idea how?

@AlternativePerspective

Is this some kind of stealth boast?

How on earth could this be a stealth post? What is there to be boasting about? Dual Citizenship? Paying taxes to 2 different countries. What is there to boast about

None of this makes sense. You say you’re going to contact a “solicitor” tomorrow. So you’re in the U.K., seeking British advice. Is your DS here too currently?

Looking at it - does he have significant unearned income (eg investment income)? What you need is a tax advisor. For someone who is spending more than half the year in the UK, giving up a UK passport and therefore the right to work here or to easily enter the country is a major step. It's not something I'd be encouraging my child to do unless the benefits were immense.

Even for the other way round (if he is not tax resident in the US), there aren't many 18 year olds with jobs that allow them only to work 50% of the year and still pay them over the 100k threshold to have to pay US taxes! What is he doing at 18 to be making $200k a year pro-rata?

If he's living in the UK and working remotely for a US company for six months of the year then he is working in the UK. His US company will probably have a tax presence in the UK and need to collect PAYE. Again, not having a US passport won't change this.

@GroundAlmonds

None of this makes sense. You say you’re going to contact a “solicitor” tomorrow. So you’re in the U.K., seeking British advice. Is your DS here too currently?

No. Im in the US. One of my son's is living in Newmarket and has 18 months. My 3rd son will be moving in January for 4 years. He is the dual citizen.

@Nomaigai

Looking at it - does he have significant unearned income (eg investment income)? What you need is a tax advisor. For someone who is spending more than half the year in the UK, giving up a UK passport and therefore the right to work here or to easily enter the country is a major step. It's not something I'd be encouraging my child to do unless the benefits were immense.

Even for the other way round (if he is not tax resident in the US), there aren't many 18 year olds with jobs that allow them only to work 50% of the year and still pay them over the 100k threshold to have to pay US taxes! What is he doing at 18 to be making $200k a year pro-rata?

If he's living in the UK and working remotely for a US company for six months of the year then he is working in the UK. His US company will probably have a tax presence in the UK and need to collect PAYE. Again, not having a US passport won't change this.

My son joined the US military. He is being transferred to the UK in January for 4 years. With COLA and hazard pay pay and housing allowance he will be making about 60 thousand a year. He won't be there for 6 months but 4 years

How on earth could this be a stealth post? What is there to be boasting about? Dual Citizenship? Paying taxes to 2 different countries. What is there to boast about a poster asked whether he is even paying enough tax at eighteen for this to be an issue and you replied “very much so.”

That implies that at eighteen your child is very much on a higher income which most eighteen year olds, in fact most people on here definitely are not.

I assume that if he renounces his British citizenship so he doesn’t have to pay tax here in the UK he doesn’t intend to use any services here such as the NHS?

Agreed none of this makes sense! How can he be in the UK for over six months a year if he's in the US for four years?

But nothing changes the basic advice - the UK tax system doesn't work like the US one. Disclaiming his nationality isn't going to make a difference to the tax he has to pay. If this were the other way around then (working in the UK, US passport) then it would do if he was on over 100k a year.

No he will be there for 4 years for now.

Right so he is eighteen, holding dual US/UK nationality, embarking on a four year degree course (?), with a large, unearned US income?

Or are you going to tell us he is earning $$$$s whilst also studying FT in GB?

Madness to renounce the citizenship of the country he is doing his undergrad in. What if he decides to settle here? You are here. His university peer group will be here.

I think you’re underestimating the dollar value of British National’s to a British domiciled young adult, quite honestly.

Also, paying tax on money you haven’t earned is never as painful as taxed earnings.

Cross post. Finally getting clearer. You need to get specific tax advice on taxes from an expert in overseas military postings.

@AlternativePerspective

How on earth could this be a stealth post? What is there to be boasting about? Dual Citizenship? Paying taxes to 2 different countries. What is there to boast about a poster asked whether he is even paying enough tax at eighteen for this to be an issue and you replied “very much so.”

That implies that at eighteen your child is very much on a higher income which most eighteen year olds, in fact most people on here definitely are not.

I assume that if he renounces his British citizenship so he doesn’t have to pay tax here in the UK he doesn’t intend to use any services here such as the NHS?

Why would he use NHS when he has always used US military benefits. He has joined the US military and being stationed in the UK in January. Yes with his cola pay, hazard duty pay and bonuses he will have to pay tax

My son joined the US military. He is being transferred to the UK in January for 4 years. With COLA and hazard pay pay and housing allowance he will be making about 60 thousand a year. He won't be there for 6 months but 4 years

Ah okay. Military, not Uni.

60k is great either in £ or $ at the age of 18, but it’s not going to attract the kind of tax bill
that is worth renouncing a citizenship over.

Get tax advice first.

@GroundAlmonds

No he will be there for 4 years for now.

Right so he is eighteen, holding dual US/UK nationality, embarking on a four year degree course (?), with a large, unearned US income?

Or are you going to tell us he is earning $$$$s whilst also studying FT in GB?

Madness to renounce the citizenship of the country he is doing his undergrad in. What if he decides to settle here? You are here. His university peer group will be here.

I think you’re underestimating the dollar value of British National’s to a British domiciled young adult, quite honestly.

Also, paying tax on money you haven’t earned is never as painful as taxed earnings.

What part of he is in the US military and is being stationed there do you not understand? He isn't studying in a UK school. He will be attending college through a US university online. He will earn evey dime of his money

Double tax agreements would normal exclude military income when posted overseas from local tax but I don't know how this works for US-UK and whether UK nationality does indeed matter (seems unlikely).

What part of he is in the US military and is being stationed there do you not understand? He isn't studying in a UK school. He will be attending college through a US university online. He will earn evey dime of his money

What part of he is in the US military and is being stationed there do you not understand? He isn't studying in a UK school. He will be attending college through a US university online. He will earn evey dime of his money

Gosh you’re very rude.

I X posted with you. Try scanning down the page. You could have just put all the information in your OP, instead of making us all struggle through the hints and drip feeds.

@GroundAlmonds

My son joined the US military. He is being transferred to the UK in January for 4 years. With COLA and hazard pay pay and housing allowance he will be making about 60 thousand a year. He won't be there for 6 months but 4 years

Ah okay. Military, not Uni.

60k is great either in £ or $ at the age of 18, but it’s not going to attract the kind of tax bill
that is worth renouncing a citizenship over.

Get tax advice first.

That tax bill hurts like hell. Even when I was 22 it hurt like hell. Now it just makes me angry but I won't denounce due to my property obligations and finial obligations

Why don’t you check what @Nomaigai is saying first though? What she is saying sounds likely.

This is what tax treaties are for.

@Nomaigai

Double tax agreements would normal exclude military income when posted overseas from local tax but I don't know how this works for US-UK and whether UK nationality does indeed matter (seems unlikely).

It doesn't. When I was stationed there I was taxed by earned income from US military and property

@GroundAlmonds

What part of he is in the US military and is being stationed there do you not understand? He isn't studying in a UK school. He will be attending college through a US university online. He will earn evey dime of his money

What part of he is in the US military and is being stationed there do you not understand? He isn't studying in a UK school. He will be attending college through a US university online. He will earn evey dime of his money

Gosh you’re very rude.

I X posted with you. Try scanning down the page. You could have just put all the information in your OP, instead of making us all struggle through the hints and drip feeds.

If you don't want me to be rude to you then don't be rude to me. You were very condescending and troll hunting

@HeronLanyon

Renounce not denounce - only saying as it’s less judgmental ! Read your title and thought it was an act of furious flouncy disgust about something (lots to choose from right now in U.K. and us !)

I love the UK except in Winter. SAD is a very real thing. If it wasn't for that I would be happily living in my house in Cambridge

@Leaannb there’s no need to renounce his UK citizenship and he won’t be subject to dual taxation. The US & the UK have a tax agreement that if someone pays taxes in either country then it’s credited toward the income/social security taxes. His income is is also below the usual threshold for what’s called the Foreign Income Exclusion that’s part of this agreement. That’s around $108,000 and is adjusted every year. A few years back it was $95,000. If your son doesn’t have physical assets like property in the US or UK, then he’ll be fine.

PM if you want and I can give a reference for an American accountant who works with overseas clients (me included) and some American in UK FB groups that would be more helpful than posting on here. :)

@Leaannb
When I was stationed there I was taxed by earned income from US military and property

It was likely the property that was taxed and not the income.

You were active duty military stationed in the UK and were taxed by the UK on US property income? You would of course be taxed by the UK on UK property income.

On the actual military income, again take specific tax advice. As I said I don't know the UK-US DTA but this seems wrong. There is no point him renouncing his nationality unless it's going to make a difference.

And the actual term is renounce not just for politeness either. That’s what the process is called. :)

I don't believe the foreign income exemption applies to US military - he will be fully taxed in the US.

[quote JingsMahBucket]@Leaannb there’s no need to renounce his UK citizenship and he won’t be subject to dual taxation. The US & the UK have a tax agreement that if someone pays taxes in either country then it’s credited toward the income/social security taxes. His income is is also below the usual threshold for what’s called the Foreign Income Exclusion that’s part of this agreement. That’s around $108,000 and is adjusted every year. A few years back it was $95,000. If your son doesn’t have physical assets like property in the US or UK, then he’ll be fine.

PM if you want and I can give a reference for an American accountant who works with overseas clients (me included) and some American in UK FB groups that would be more helpful than posting on here. :)[/quote]
He owns property in US but not UK