IRS CLARIFIES US NON-DOM TAX STATUS
The Internal Revenue Service (IRS) has issued a Revenue Ruling (Revenue Ruling 2011/19)confirming that US taxpayers can claim credit for the remittance basis charge.
The IRS decision means that non-dom US tax payers who are resident in the UK and choose to pay tax on the so-called remittance basis can set the annual £30,000 levied by the UK tax authorities for doing so against their US tax bills.
According to the Treasury’s consultation document on the taxation of non-domiciles, around 5,400 individuals paid the remittance charge in 2008/09. A significant proportion of these are likely to have been US taxpayers.
The IRS Revenue Ruling is available at www.irs.gov/pub/irs-drop/rr-11-19.pdf