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I have a bit of a complication to my move to the UK. I am moving to the UK for a couple of years from the US. I am being paid by the US Government. I have a couple of questions about how this works.

  1. I know there's a treaty between the US and UK. It's my understanding that, as a US citizen working for the US government in the UK, I pay US taxes. Is that true?
  2. My employer does not give me health insurance, but a sum of money to buy it. Does that mean that I need to buy health insurance in the UK? How does this work exactly? Do I need to pay the National Healthcare Service tax in the UK in addition to the US taxes? I'm really confused by this one.
  • This might be best split into two questions, as they're rather different – Gagravarr Aug 11 '14 at 8:43
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    Would you be classed as a diplomat in the UK? Do you have 2 passports (one normal US and one diplomat US)? – Vagish Aug 11 '14 at 15:42
  • Nope, I am working at a University there on a US government funded grant that is paying for me to be a researcher at the university there. I will have a Tier 2 workers visa. – Tyler Kelly Aug 11 '14 at 19:23
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I'll answer your question in 2 parts as you asked.

  1. Yes, you will pay income tax and whatever social security in the USA for USA income in the UK. Only time you get taxed in the UK is if the USA doesn't tax you. (See the Income Tax Treaty and HMRC). You still need to report all global income to the USA and UK.

  2. If you satisfy the residence conditions which you should, then you get free NHS cover. If you want private you can get your own insurance in the UK. There isn't an extra tax for healthcare, there is only income tax in the UK.

    Foreign diplomats are exempt from paying for treatment in the NHS, see here.

    Since you will be on a Tier 2 visa (and not working for a UK business), you should be covered after 12 months of residing in the UK. See here also here. You can however get limited free healthcare for things like emergency treatment (but it is limited). You can get expat insurance from the USA, or apply for coverage in the UK. I would think getting covered through a USA company would be easier. I've done that for when I was abroad for extended periods of time before using a UK expat insurer.

    Anyone who has lived lawfully in the UK for the 12 months prior to treatment. An absence of up to 182 days is allowed but you must have had immigration permission to be in the UK for the full 12 months

  • It seems your answer only covers the more common case of someone moving to the UK to work for a UK business. The OP did not specify exactly what her status is but working for a foreign government could be different. – Gala Aug 11 '14 at 15:30
  • @Gala I've looked at the rules. And he should be exempt if he is a foreign diplomat. My friend works in the US embassy in India and she was classed as a foreign diplomat, even had a US diplomatic passport. – Vagish Aug 11 '14 at 15:41
  • @Vaghish Diplomat are indeed generally exempt of all taxes. But what I meant is are you familiar with this situation or are you just answering based on the general case and your reading of the treaty? – Gala Aug 11 '14 at 15:48
  • @Gala I am somewhat familiar with the situation since I'm a UK citizen earning income in the UK living in the USA with my wife. And she plans to move to the UK at some point so I have read a lot about this. I haven't dealt with diplomatic status before myself. – Vagish Aug 11 '14 at 16:00
  • Thank you. I said this in the comments above. I am working at a University there on a US government funded grant that is paying for me to be a researcher at the university there. The UK university is not paying me a cent. I will have a Tier 2 workers visa. – Tyler Kelly Aug 11 '14 at 19:24

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