American Expat's Money Guide: United Kingdom
Transfers, banking, and US + local taxes for Americans in United Kingdom. Currency: GBP.
The quick answer
- US tax treaty
- Yes
- Totalization (SS) agreement
- Yes
- Special expat tax regime
- 4-year Foreign Income & Gains (FIG) regime
- Bank account as a US citizen
- Yes
Local top marginal income-tax rate (headline): 45%. Effective rates depend on income, residency status, and any special regime. Figures here are general and can change — verify against current law before relying on them.
Informational only — not financial, tax, or legal advice. Cross-border tax is fact-specific; confirm with a qualified cross-border CPA or adviser before acting. Some links are affiliate links — we may earn a commission at no extra cost to you. Full disclaimer.
Cost of living vs. New York City
United Kingdom is about 32% cheaper overall
Typical 1-bed city-centre rent: $3,073/mo. Compare cost of living →
Approximate — Numbeo, NYC = 100, as of 2026-06.
1 Moving your money (USD → GBP)
USD→GBP is a major, highly liquid corridor; a specialist FX/transfer service beats a bank wire's rate substantially on a relocation lump sum.
See exactly what your amount costs across the mid-market rate, a typical bank, and a specialist — then send with the cheapest.
2 Banking as an American in United Kingdom
Americans can open UK accounts, but typically need a UK address and proof of residence (visa/BRP, utility bill); as a US person you'll be asked for your SSN/TIN for FATCA. Major high-street banks serve US persons; 'international/expat' accounts exist for non-residents but often require large minimum balances. Verify current eligibility with each bank.
Local banks generally accept US persons under the FATCA agreement, though some are cautious about the extra reporting.
3 Taxes — the part everyone gets wrong
The US side (you still file)
- You file a US return on worldwide income. FEIE or the Foreign Tax Credit usually prevents true double taxation — which one wins depends on your income and local rates.
- FBAR (FinCEN 114) if your foreign accounts top $10,000 combined at any point in the year.
- FATCA (Form 8938) may also apply above higher thresholds.
The United Kingdom side
United Kingdom offers a special regime — 4-year Foreign Income & Gains (FIG) regime. The old non-dom 'remittance basis' was abolished on 6 April 2025 and replaced by a residence-based 4-year FIG regime: new arrivals who were non-UK-resident for the prior 10 years get relief on qualifying foreign income and gains for their first 4 years of UK residence. Crucially, FIG is a UK relief only and does NOT reduce US tax for American citizens, who remain taxed on worldwide income. Top income-tax rate is 45% (England/Wales/NI); Scotland's top rate is 48%. Verify current rules on gov.uk.
Where this gets people
- UK ISAs are a trap for US persons — tax-free to HMRC, but the funds inside are usually PFICs to the IRS (a Form 8621 per fund). The 25% tax-free pension lump sum also isn't tax-free to the IRS.
- The UK tax year runs 6 April–5 April, not the calendar year, which complicates foreign-tax-credit timing on your US return.
- The new 4-year FIG regime is a UK relief only — it doesn't reduce your US tax as an American citizen.
- A "special regime" headline rate is not your effective rate — eligibility and exclusions matter a lot.
- State taxes can follow you abroad depending on the US state you left — don't assume you're done with them.
Cross-border tax is fact-specific and the penalties are real. A US-expat tax specialist handles FEIE/FTC, FBAR, and FATCA correctly.
Get expat taxes done with Bright!Tax →4 Investing & brokerage
US brokers sometimes drop customers with a non-US address. A broker that explicitly supports non-resident Americans is the standard fallback. Beware buying local (non-US) funds — PFIC (Passive Foreign Investment Company) rules make them a US tax nightmare.
Open an account with Interactive Brokers →5 Healthcare & insurance
Legal residents generally gain access to United Kingdom's public health system, but there's usually a gap before residency and coverage kick in. Many new arrivals and nomads bridge the gap with international coverage.
See SafetyWing coverage →6 Common residency routes
Your residency route determines your tax residency and bank access — they're connected.
Frequently asked questions
Do Americans living in United Kingdom still have to file US taxes?
Yes. US citizens file with the IRS on worldwide income no matter where they live. The US–United Kingdom tax treaty and tools like the Foreign Earned Income Exclusion (FEIE) or the Foreign Tax Credit usually prevent true double taxation, but you still must file. This is general information, not tax advice.
Do I need to file an FBAR if I move to United Kingdom?
If your foreign financial accounts add up to more than $10,000 at any point in the year, you generally must file an FBAR (FinCEN Form 114). Many expats also have FATCA (Form 8938) obligations. Penalties for missing these are steep — confirm your situation with a cross-border professional.
What's the cheapest way to move money to United Kingdom?
For a relocation lump sum, the cost is almost entirely the exchange-rate spread, not the visible fee. Banks commonly bury 1–3% in the rate. Compare your specific amount with the transfer cost tool before sending.
Can I keep my US brokerage account after moving to United Kingdom?
Some US brokers restrict or close accounts once you have a non-US address. A broker that explicitly supports non-resident Americans is the common fallback. Don't change your address until you've confirmed your broker's policy.
Data last verified 2026-06-03. Primary source: official reference.
Informational only — not financial, tax, or legal advice. Cross-border tax is fact-specific; confirm with a qualified cross-border CPA or adviser before acting. Some links are affiliate links — we may earn a commission at no extra cost to you. Full disclaimer.