Atlanta companies should be aware of a new income tax provision between the U.S. and United Kingdom, signed July 24, that gives tax relief to U.S. and UK citizens who are residents in another country, said Michael Bates, the new British consul general in Atlanta.
The treaty “enables and promotes open markets, enterprise and business flexibility,” Mr. Bates told GlobalFax, by allowing employees a tax exemption in the host country when an employer sends them to work in that host country for a limited period of time.
Employees may exempt income if they spend 183 days or less in a 12-month period in the host country, and provisions can be made to prevent double taxation of the employee’s income.
The new statute provides that U.S. citizens or permanent residents will not be considered U.S. residents for income tax purposes if they are already considered residents of the UK or any other country having such a tax treaty with the UK.
U.S. citizens working overseas can also deduct contributions to foreign pension plans for U.S. tax purposes, and UK employees can exempt contributions to a UK pension plan while they are working in the U.S.
The full tax convention may be read at www.inlandrevenue.gov.uk/pdfs/ukusa_dtconvention1.pdf.
Mr. Bates said he is dedicating 50% of his work time to consulting Southeastern U.S. companies on trade development and investment opportunities with Britain. He added that the consulate’s trade officers visit 150 companies in the Southeast each year and are ready to assist firms to do business with Britain.
Mr. Bates encouraged companies to search for British suppliers from among the 55,000 firms that have registered on the TradeUK Web site at www.tradeuk.com. Companies may also use this service to develop sales leads.
Contact the British Consulate General at (404) 954-7716.