United Kingdom Expat Tax Guide 2025
FEIE, Foreign Tax Credits, banking, visa options & filing strategies for US expats in United Kingdom.
How United Kingdom Taxes Work
United Kingdom's tax system: Worldwide income for UK tax residents; remittance basis available for non-domiciled.
FEIE vs Foreign Tax Credit
FTC is typically better than FEIE due to UK rates (20–45%). Totalization agreement covers SS. Non-dom status may help.
The FEIE allows you to exclude up to $130,000 of foreign earned income from US taxation in 2025.
Social Security & Self-Employment Tax
United Kingdom has a totalization agreement with the US. This prevents double Social Security taxation.
Banking for US Expats
HSBC, Barclays, and Monzo accept US expats. FATCA compliance is standard.
Visa Options
Skilled Worker visa, Innovator Founder visa, or Global Talent visa.
Cost of Living
High — $3,000–$5,000/month in London, $2,000–$3,000 outside London.
Frequently Asked Questions
Do US expats in United Kingdom need to file US taxes?
Yes. US citizens must file regardless of where they live. The FEIE can exclude up to $130,000.
Should I use FEIE or FTC?
FTC is typically better than FEIE due to UK rates (20–45%). Totalization agreement covers SS. Non-dom status may help.
What is the cost of living?
High — $3,000–$5,000/month in London, $2,000–$3,000 outside London.
Compare FEIE vs FTC vs Combined strategies for United Kingdom.
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