opening a UK savings account from the US

Cook_County

digerati is advocating tax evasion, which is illegal and could get the you extradited to the United States to face criminal charges. In addition the husband has a duty of trust as a trustee which he simply can't ignore.

It is also impossible to apply for a refund before leaving the United States because you can't file the 2007 returns until early in 2008. These returns will ask you to declare whether you have to file forms 3520 and 3520-A.

I am sorry to sound harsh but hiding does not eliminate tax problems which might be correctable through proper advice.

obsessed_saver

Get your parents-in-law (or your parents, depending who is resident in the UK and who is paying the lower rate tax) to open a savings account in the UK (in their name) and store the money there first. And then they can give it you once you return to the UK. Guess there's no two ways about this. Opening a new account will require proof of identity like a utility bill, driving license, tax coding notice, etc.

stogiebear

I have (or had) a simlar problem...

I was sending my brother about 1,500 quid a month to a savings account he opened for me at the Abbey. As it was in his name when that amount became sizeable he became worried and so I came back to the UK to open a bank account. (I also phoned the tax people and they said that my brother storing money for me was fine if it was easily provable but still - if he croaked then I would be in trouble!)

Well - it was impossible to open an account in the UK so I had to start getting sneaky about it. So - here is what to do when you are NOT living in the UK but you need to re-establish credit in the UK for a later return...

First - get a friend (or family member) with good credit to allow you to use his address as a residency address.

Second - get yourself on the electoral roll.

Third - Get your friend to add you to either the phone bill or the water bill. (Preferably both.) (Yes you can be added to the bill so both names appear clearly on the statements.)

Fourthly - get your second form of photo ID - which is a UK drivers licence. (I assume if you are an expat you already have a UK passport, right?

Wait a few weeks and then open up a savings account. Your credit won't be checked for this but they will check to make sure that you are who you say you are on the electoral roll.

Large deposits WILL be investigated as suspicious and referred to the cops, by the way so have your legal stuff tight and correct.

Next - you'll probably start recieving piles of junk mail from the tax office who have clicked that you are now (supposedly) a resident. Call them and ask them to stop mailing yuo their demands for tax and NI etc and tell them the truth about why you are opening an account and that you are just trying to establish credit now so you won't have these hassles later...

After about three months apply for a premium current account with the people that you have a savings account with. You'll get a Visa Electron or something similar.

After another three months apply for their basic Visa credit card and from then you'll be flying... as much junk mail as you can burn as wintry fuel!

Good luck...

weezypops

Cook_County wrote: »

It sounds as if you may have significant US tax problems.

As beneficiaries of a foreign trust you must also file Forms 3520 and 3520-A along with your US tax return each year. Your husband should also have disclosed signature authority on your annual foreign bank reporting forms.

Penalties for failure to file Forms 3520 and 3520-A are a whopping 35% of the value of the trust. Penalties for failure to file the foreign bank forms are even more horrid than that.

You may even find that the trust may be US resident because it has a US resident trustee so could be subject to US courts - but you'd need a US lawyers opinion on this.

This is not a DIY type of issue and you should urgently take legal advice before leaving the United States.

I don't really understand why US tax comes into it though. The money has always been in the UK and will stay in the UK. The account we're opening will be a UK account, we'll only be spending it there. We're only here in the US on a work visa, we're not permanent residents, so it's never been something that's come into our finances here. Our UK finances and US finances are seperate.

Plus, we're not beneficiaries of the trust in that we get regular money from it, so it didn't add to our income at all last year, nor will it add to our US income this year - it's a one-off payment.

barak

Cook_County wrote: »

All I was saying was that 100% of the UK tax liability can be avoided

There is no liablilty for UK tax if you are living and taxed elsewhere.

Cook_County

weezypops wrote: »

I don't really understand why US tax comes into it though. The money has always been in the UK and will stay in the UK. The account we're opening will be a UK account, we'll only be spending it there. We're only here in the US on a work visa, we're not permanent residents, so it's never been something that's come into our finances here. Our UK finances and US finances are seperate.

Plus, we're not beneficiaries of the trust in that we get regular money from it, so it didn't add to our income at all last year, nor will it add to our US income this year - it's a one-off payment.

I am sorry but US tax does come into the picture. You are currently resident in the US so are taxable in the US on worldwide income and gains. Being US resident also subjects you to worldwide reporting on foreign trusts. Failure to comply is something where imprisonment is one of the weapons used by the IRS in appropriate cases because failure could be a criminal offence.

Ever since you became US resident you have always had to declare your savings and bank accounts in the UK to the IRS and US Treasury. There is no such thing as keeping them separate.

You/your husband and the trustees need legal advice urgently.

Cook_County

barak wrote: »

There is no liablilty for UK tax if you are living and taxed elsewhere.

This is not correct in this case because the OP will be returning to the UK in this current UK tax year so there is potential for UK tax on all income from 6 April 2007, unless the split-year concession outlined in IR20 is both claimed and applicable (so for example it can't be applied to UK source bank interest).