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Us Tax Form Advice
2 Answers
I'm a US Resident Alien, and a college student still studying in the UK.
My mother recently moved to the US, and through her she encouraged me to get a green card to give me options on where to stay after I graduate.
I want to start an online business, the ad networks I'm signing up with are asking for a form. I'm stuck between the W-8Ben, 8233 and the W9.
I'm not sure if I want to stay in the US, so I don't want to pay US taxes (not to mention US tax laws are intimidating compared to the UK), and I'm staying in the UK for most of the year (and I'll probably stay here when I graduate).
Which tax form should I choose?
My mother recently moved to the US, and through her she encouraged me to get a green card to give me options on where to stay after I graduate.
I want to start an online business, the ad networks I'm signing up with are asking for a form. I'm stuck between the W-8Ben, 8233 and the W9.
I'm not sure if I want to stay in the US, so I don't want to pay US taxes (not to mention US tax laws are intimidating compared to the UK), and I'm staying in the UK for most of the year (and I'll probably stay here when I graduate).
Which tax form should I choose?
Answers
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If you'll be living in the UK for most of the year, and operating a business from here, you'll be a UK taxpayer and not a US one. (Your nationality is irrelevant). IRS form W-9 only refers to a business-
00:49 Wed 06th Sep 2017
If you'll be living in the UK for most of the year, and operating a business from here, you'll be a UK taxpayer and not a US one. (Your nationality is irrelevant).
IRS form W-9 only refers to a business-contractor relationship which is subject to US taxation, so it doesn't apply to you.
IRS form 8233 only applies to non-US citizens in the USA, who are seeking exemption from certain taxes. So, since you're outside the US tax system anyway, that also doesn't apply.
IRS form W8-BEN has to be submitted to any company that would normally be obliged to deduct US taxes from payments if it's necessary to show that the person completing the form isn't subject to US taxation. So that appears to be the one you need.
However I need to add a caveat to the foregoing. If you're going to declare that your business is UK-based you'll need to register with HMRC for self-assessment and to declare the nature of the business which you're running. I think it's likely that you can't do that without a National Insurance number and you can't get one unless you've currently got the right to work here. So if your student visa prohibits you from taking up employment in the UK you could have a problem.
IRS form W-9 only refers to a business-contractor relationship which is subject to US taxation, so it doesn't apply to you.
IRS form 8233 only applies to non-US citizens in the USA, who are seeking exemption from certain taxes. So, since you're outside the US tax system anyway, that also doesn't apply.
IRS form W8-BEN has to be submitted to any company that would normally be obliged to deduct US taxes from payments if it's necessary to show that the person completing the form isn't subject to US taxation. So that appears to be the one you need.
However I need to add a caveat to the foregoing. If you're going to declare that your business is UK-based you'll need to register with HMRC for self-assessment and to declare the nature of the business which you're running. I think it's likely that you can't do that without a National Insurance number and you can't get one unless you've currently got the right to work here. So if your student visa prohibits you from taking up employment in the UK you could have a problem.
If I understand you correctly then you are not a US citizen. My understanding is that not only have US citizens to complete a Federal tax return and answer to any demands they make but it will depend on which US state has you as a resident there whether you have to pay state tax - I don't know how green card holding non-US citizens living outside the US are affected by US tax law (except in the last year of residence or part of year there - then probably a return is mandatory). I am unfamiliar with the effects of reciprocal tax agreements on federal tax obligations in your case but I have been told that these have no effect on any state taxes which may be payable. I would have thought that unless living in the US, green card holders have the right to enter and seek work but unless they take that up they remain as any other foreigner outside he country (card or no card) - but I don't know.
US tax procedures are notorious for not being much interested in where US citizens live and even though such individuals never set foot in the country for years, the US authorities continue insisting on tax returns being submitted and at least some taxes being paid. The only way to definitely shake them off is to renounce any claim to US residence/citizenship. I know of one person who as a late teenager decided (against his twin brother's advice) to take joint US citizenship when with their mother they had been living in the US, the other I believe has a green card. Guess which is smiling and who not now that they are now back where they came from (one files returns and continues to pay in both places, the other not) ?
Chris is right that you must conform to UK regulations if/when living/operating in the UK. Regarding the US situation in your case, I suggest you seek very reliable advice so as not to put a foot wrong or unnecessarily going through procedures which are not required of you. Also consider what a green card does for you (pluses and minuses), whether you want one.
US tax procedures are notorious for not being much interested in where US citizens live and even though such individuals never set foot in the country for years, the US authorities continue insisting on tax returns being submitted and at least some taxes being paid. The only way to definitely shake them off is to renounce any claim to US residence/citizenship. I know of one person who as a late teenager decided (against his twin brother's advice) to take joint US citizenship when with their mother they had been living in the US, the other I believe has a green card. Guess which is smiling and who not now that they are now back where they came from (one files returns and continues to pay in both places, the other not) ?
Chris is right that you must conform to UK regulations if/when living/operating in the UK. Regarding the US situation in your case, I suggest you seek very reliable advice so as not to put a foot wrong or unnecessarily going through procedures which are not required of you. Also consider what a green card does for you (pluses and minuses), whether you want one.
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