Relinquishing US Citizenship - Serving RAF - Advice needed

[tutgby]

Hi Guys,

Long story short I am currently serving in the RAF but was born in the USA. I left when I was a year old and have never been back. Recently I have heard stories about the US Govt charging about $2000 for someone to relinquish their citizenship....personally seems a bit ridiculous given I had to gain citizenship to leave the country! There's also chat about having to complete tax returns for the last 5 years of which the US Govt wants to tax.

However, as I serve in the UK Armed Forces and have sworn an oath etc. I believe that makes me 'unpalatable' from the Yanks' point of view of being a citizen and that it is easier to relinquish citizenship without being penalised.

Has anyone on here had experience of doing this? And if so I would be grateful if you could PM me with how you did it, what you did etc. etc. and whether you were charged for the privilege? I believe the rules have been changed fairly recently so recent experience would be great but in truth anyones experiences would be welcomed!

Thanks in advance,

Ed

[Pontius Navigator]

IIRC I met an RAF Sgt who had dual nationality.

[ORAC]

Both the UK and USA allow dual nationality, so there is no need to relinquish US citizenship if you don't want to - it might prove advantageous in future.

There are minor inconveniences - ask Biris Johnson!!

The USA does tax worldwide, so you do have a requirement to submit tax returns, but there is a reciprocal tax regime so as you pay your UK taxes it is just a paperwork issue, and not overly expensive - there are a lot of accountants who can do it for a few pounds.

Boris found they would not let him in with a UK passport, requiring his "national" US passport - so If you haven't got one, get one if you wish to visit.

[Army Mover]

I have dual-nationality (UK/US); it was never a problem in 24-years service.

[cliver029]

ORAC

"Boris found they would not let him in with a UK passport, requiring his "national" US passport"

I suspect that was part of the "Boris effect", my Daughter-in-law lives in the "States"
and has used both on entering at various times, it also might depend on the TSA staff on shift at the time....who knows the secret of the TSA mentality.

[ian16th]

The USA tax guys have become very aggressive in recent times.

As said, all US citizens are liable for US tax, the dual tax agreement might take care of 'normal' income tax, but I believe that some people have problems when buying and selling property.

Uncle Sam comes after what he sees as a capital gain.

Check the Telegraph Ex-pat pages, it has been on there.

[Bare Plane]

There is also a requirement for US citizens to file a Report of Foreign Bank and Financial Accounts (FBAR) Google FBAR for the info. Basically, if you have more than $10,000 in foreign (non-US) banks, you have to file this report. And it is cumulative. $10,000 over various accounts. And it doesn't have to be your money. I have signature authority for my school Parents Counsel and have to include that amount. I would recommend contacting the US Consulate near you and ask them. they should have a person responsible for answering tax questions. My daughters have dual citizenship and have to deal with these problems. I would recommend counsel from an authority.

[heights good]

I think the only time it becomes an issue is if you are applying for a Developed Vetting security clearance. I know of people from the 5 Eyes community with dual citizenship that have had issues and have had to give up the foreign citizenship.

[ian16th]

Double Trouble: The Pain of Dual Citizen Expat Taxes - Expat - WSJ (http://blogs.wsj.com/expat/2016/03/29/double-trouble-the-pain-of-dual-citizen-expat-taxes/)

https://travel.state.gov/content/travel/en/legal-considerations/us-citizenship-laws-policies/citizenship-and-dual-nationality/citizenship-and-foreign-military-service.html

When Is Dual Citizenship Not A Good Idea? | Investopedia (http://www.investopedia.com/articles/personal-finance/040715/when-dual-citizenship-not-good-idea.asp)

May be of interest to the O/P

[son of brommers]

I have dual nationality, UK and RSA. I lost out on a job with LM as needed both UK and US clearance. UK fine but US refused on dual grounds. US embassy in London advised that even if I gave up my RSA citizenship, I wouldn't get US clearance as I still have family in RSA.

[Whenurhappy]

I've got dual nationality (FVEY) and very specific clearances; in 2001 I was told to relinquish my other nationality by the UK (when I was working for the US State Department). I pointed out the tautology that this required me to formally renounce the Queen as Head of State! Fast forward to a couple of years ago when I had to undergo additional vetting for my latest appointment and my dual nationality was simply not raised as an issue.

[Bare Plane]

another financial filing issues is FATCA: HERE is a link for info: https://www.irs.gov/businesses/corporations/fatca-information-for-individuals

[Heathrow Harry]

In general if you have decent US accountant to do your US Tax return the amount of tax you pay in the UK covers any US tax bill

If however you are into "avoidance" you may run into problems

The answer is to do it regulalry so that they don't haul you in whenever you arrive at JFK.....................

[Jimlad1]

I know some UK/US nationals who havent had any problems, despite working in very sensitive areas.

More widely, does any other country insist on this tax arrangement of filing taxes even if a dual national - seems a bit complicated to me!

[ORAC]

".....Eight OECD nations have worldwide systems, including the U.S., Greece, Ireland, South Korea, and Mexico."

Hmmm, I am a dual UK/Irish citizen, as are millions, and was not aware of that. Certainly never done a return.

Ahhh, that's OK. For Ireland you have to be resident or domiciled during the tax year to be liable.

http://irishabroad.com/Irish-World/Expats/Moving-to-Ireland/Working/taxation/

[Trim Stab]

I think the only time it becomes an issue is if you are applying for a Developed Vetting security clearance. I know of people from the 5 Eyes community with dual citizenship that have had issues and have had to give up the foreign citizenship.

'Five Eyes" = UK, Aus, NZ, Canada, USA - so no problem with dual citizenship of UK/US for that level of clearance, or any combination.

[msbbarratt]

The US taxes one for things one has not been taxed for in the UK. So it's not double taxation, but it is tax plus.

For houses that may be problematic. One doesn't pay capital gains on the profits from the sale of one's main house in the UK. They do tax that in the USA, so that might one day attract the attention of the IRS...

There's only two countries in the world that tax this way: the USA and the communist dictatorship of Eritrea...

[1771 DELETE]

The tax agreement that every one is talking about is a Federal tax agreement with the UK. The UK has several taxation agreements with countries around the world, however in the American case, it is not an agreement with individual states, you will therefore be taxed twice on your earnings by some states, not all and not a military pension in some states. Before taking out dual citizenship, careful thought has to be given to the long term consequences, for me i had to so that i could have a USCG masters ticket and have a boat thats federal documented. Its not such a hinderance to those living in the states but if you are dual and living else where it can be a royal pain.

[PersonFromPorlock]

....who knows the secret of the TSA mentality[?] Terry Pratchett.

“The universe, they say, depended for its operation on the balance of four forces which they identified as charm, persuasion, uncertainty, and bloody-mindedness.”'They' may have been wrong about the charm and persuasion, though.