Do you need to report American income to the Inland Revenue?

[Uwila]

If I earn money in the US, am I supposed to tell the IR and pay UK taxes on it? I am a permanent resident of the UK, but an American citizen. I know I have to report all income, including UK income, to the US (but don't have to pay taxes on it because I am paying taxes here in the UK). But, I want to know if the reverse is true. I am considering selling a website to a buyer in the US. He wants to go through a US broker and pay in US dollars. So, it makes sense for the whole thing to be a US transaction with my US bank account.

Uwila - hello! We saw each other on a thread a while back but didn't think it was the right time for a hijack to reply. Anyway, hope you're all doing well, don't forget to pop into the Junie thread every now and then to let us know how you are doing.

Anyway, short answer: yes, you have to declare all income on your UK tax return, and if you're not paying tax on it at source you will have to pay it here (in fact even if you are paying in the US you will prob have to make up the difference in the UK because of the lower rate of taxation in the US. You don't have to do that the other way round cos the taxes are higher here).

So for example, I had to declare all income on both my Swedish and my UK tax returns but the UK kindly took the view that, having been gouged for 60% of it in Sweden, they wouldn't take any more.

On the other hand, if the money isn't 'coming into' the UK you might be able to circumvent things. It's worth a conversation with the IR and quite possibly an accountant too.

Hi trib. Yes, nice to see you. Every now and then I venture over to the junie thread. But, I just can't keep up. There should be a junies who seldom post thread.

Anyway, wonder if it makes any difference that I am not an EU citizen? The only thing I can think that might get me out of paying the taxes is by being a mere resident and not citizen.

Yes, I thought of consulting a solicitor/accountant. But, they cost money and I'm hoping to get some free advice on MN.

I don't think it matters, Uwila, if you are resident here for tax purposes, you have to pay tax. Much as I would in the US, I assume! A call to the IR will be free (well, may cost the price of the call), I have never called them myself but I hear they are unusually helpful.

We did have our summary thread but I think now all of us Junies would struggle to do a weekly update. Best policy I think is just to jump in with an update of your own and not worry about what everyone else is up to

We are doing our taxes at the moment and I believe you have to declare your US income on your UK return if you are UK domiciled for tax purposes
This link has the forms that explain (?) the domicile business....
www.hmrc.gov.uk/cnr/p86_dom1.htm