The United States is the world's largest economy and one of its most culturally influential countries. For ambitious professionals, entrepreneurs, and investors, it remains the destination offering the greatest concentration of opportunity. But the United States is also among the most complex jurisdictions for tax and immigration — and the consequences of getting it wrong are severe. This guide covers the practical and fiscal realities that UK expats need to understand before and after they move.
Visa Categories
The US immigration system is the most complex of any major destination country. The main non-immigrant and immigrant routes for UK nationals include:
E-1 (Treaty Trader) and E-2 (Treaty Investor). Based on the US-UK treaty of commerce and navigation, the E-2 visa is one of the most practical routes for UK entrepreneurs and investors. It requires a substantial investment in a US business (no fixed minimum, but typically USD 100,000+; the business must be active and capable of generating more than a marginal living). The E-2 is a non-immigrant visa (it does not lead directly to a Green Card) but is renewable indefinitely in two-year increments provided the business remains active.
L-1 (Intracompany Transferee). For managers, executives, or employees with specialised knowledge transferring from a non-US entity to a related US entity. The L-1A (managers/executives) allows a pathway to the EB-1C Green Card. Requires at least one year of employment with the overseas entity in the preceding three years.
O-1 (Extraordinary Ability). For individuals with extraordinary ability in sciences, arts, education, business, or athletics. Requires substantial evidence of recognition in the field. Two-year initial validity, renewable.
EB-5 (Immigrant Investor). A Green Card route for investors committing USD 800,000 (in targeted employment areas) or USD 1,050,000 (elsewhere) in a qualifying US business that creates or preserves at least ten full-time jobs for qualifying US workers. The EB-5 programme has been reformed multiple times; current rules and processing times should be confirmed with a specialist US immigration attorney.
H-1B (Specialty Occupation). For professionals in specialty occupations. Highly competitive — subject to an annual cap and random lottery. Not a reliable route for most applicants.
Green Card (Permanent Residency). Available through employment (EB categories), family sponsorship, the Diversity Visa Lottery, and refugee/asylum routes. The employment-based categories are subject to annual per-country limits, causing significant backlogs for some nationalities — though UK nationals typically face shorter waits than applicants from India or China.
The US Tax System: Critical Warnings
The United States operates on a citizenship- and residency-based taxation model that is unusual among developed nations (only the US and Eritrea tax their citizens on worldwide income regardless of where they live). The implications are significant:
US residents (including Green Card holders) are taxed on worldwide income. If you become a US tax resident — whether through holding a Green Card, passing the Substantial Presence Test (broadly, at least 31 days in the current year and 183 days counted on a weighted basis across the current and prior two years), or other means — you are required to file a US tax return reporting your global income.
The Green Card trap. Once you hold a Green Card, you are a US tax resident and must file US returns and potentially pay US tax on worldwide income even if you subsequently leave the US, until you formally surrender the Green Card through a specific legal process. Long-term Green Card holders (held for eight or more of the past fifteen years) who surrender the Green Card and who meet certain wealth or tax liability thresholds are subject to an exit tax. This is an area requiring specialist legal and tax advice.
FBAR (FinCEN 114). US persons (citizens, residents, Green Card holders) who hold foreign bank accounts with aggregate balances exceeding USD 10,000 at any point during the year must file an annual FBAR report with FinCEN. Failure to file carries severe civil and criminal penalties (up to USD 100,000 per violation for wilful failures). UK expats who become US residents must report their UK bank accounts.
FATCA (Foreign Account Tax Compliance Act). Under FATCA, foreign financial institutions report the accounts of US persons to the IRS. UK banks will report your account details if they identify you as a US person. FATCA also requires US persons to file Form 8938 (Statement of Specified Foreign Financial Assets) if foreign assets exceed certain thresholds.
UK-US Double Taxation Treaty. The UK and US have a DTA that provides relief from double taxation on most income types. However, the DTA does not eliminate all double-taxation issues — there are gaps, and specialist US-UK tax advice is essential for managing the interaction between the two systems. Many advisers who claim to handle US tax issues lack the depth of expertise required; always use a US-qualified CPA or attorney (ideally dual-qualified).
Healthcare Insurance
The United States does not have a universal public health system equivalent to the NHS. Healthcare is primarily funded through employer-provided insurance (covering the majority of working Americans), private insurance purchased individually, and government programmes (Medicare for over-65s and the disabled; Medicaid for low-income individuals).
As a working expat, your employer's health insurance plan will typically be your primary coverage. If you are self-employed or on a non-employment visa, you must purchase individual health insurance through the Marketplace (Healthcare.gov) or directly from an insurer. Costs are high — a comprehensive plan for a healthy 40-year-old may cost USD 400–700 per month in premiums, with substantial deductibles (the amount you pay before insurance kicks in, often USD 3,000–7,000 per year).
Not having adequate health insurance in the US is genuinely risky. Medical bills from a single emergency hospitalisation can reach hundreds of thousands of dollars. Ensure your coverage begins the day you arrive.
State Tax Variation
The US federal income tax applies nationwide, but states also levy their own income taxes — and the variation is significant. States with no state income tax include Florida, Texas, Nevada, and Washington. States with high income taxes include California (up to 13.3 per cent) and New York (up to 10.9 per cent, plus New York City tax up to 3.876 per cent). For HNW individuals, state tax can materially affect the overall tax burden. Choosing to live in a no-tax state versus California can make a difference of millions of dollars over a career.
Choosing Your City
New York City. The financial and cultural capital of the United States. The concentration of finance, media, arts, legal services, and global business is unmatched. Cost of living is extremely high — Manhattan and prime Brooklyn/Queens rents are comparable to Central London. Quality of life varies enormously by borough and budget.
California (San Francisco Bay Area and Los Angeles). The Bay Area (San Francisco, Silicon Valley) is the global centre of technology and venture capital. Los Angeles is the entertainment and creative industry hub. Both are beautiful, temperate in climate, and extraordinarily expensive. California's income tax burden is the highest of any US state.
Florida (Miami, Orlando, Tampa). No state income tax, warm climate, growing financial services sector (particularly Miami), and a large Latin American business community make Florida highly attractive to HNW individuals and businesses relocating from New York and California. Miami's Brickell district has become a significant financial centre. Cost of living is below New York but rising.
Texas (Dallas, Houston, Austin). No state income tax, strong economy (energy, technology, healthcare), affordable housing relative to the coasts, and a business-friendly regulatory environment. Austin has grown rapidly as a tech hub. Dallas and Houston have large and diverse economies.
How Global Investments Can Help
Relocating to the United States is one of the most complex wealth planning decisions an internationally mobile individual can make. The US tax system's worldwide reach, FBAR/FATCA reporting obligations, Green Card exit tax considerations, and state tax variation all require careful analysis before and after your move.
Global Investments can connect you with specialist US-UK dual-qualified tax advisers, US immigration attorneys, and financial planners who understand the full cross-border picture. Contact our team to discuss your US relocation plans and the financial and legal groundwork you need to put in place.
This guide is for general information only and does not constitute financial, legal or tax advice. Rules, fees and regulations change frequently; verify current requirements with a qualified adviser before acting.