Moving to the USA: Immigration, Banking and Tax for UK Expats

The United States is one of the world's most complex tax jurisdictions for expatriates, and moving from the UK to the US involves financial and legal challenges that are significantly greater than most other destinations. The US is one of only two countries in the world (the other being Eritrea) that taxes its residents and citizens on worldwide income regardless of where they live. Understanding this before you move is not optional — the consequences of non-compliance are severe. This guide covers the key issues UK expats need to understand.

Visa and Immigration Routes

Visa Waiver Programme (ESTA). UK citizens can visit the US for up to 90 days under the VWP. Not suitable for working or living.

B-1/B-2 Tourist/Business Visitor Visa. Allows visits of up to six months; still does not permit employment.

E-1/E-2 Treaty Trader/Investor Visa. The UK-US Treaty of Friendship, Commerce and Navigation allows UK nationals to obtain E-1 (treaty trader) or E-2 (treaty investor) visas. An E-2 investor visa requires a "substantial" investment in a US business — in practice, this typically means USD 100,000–500,000 depending on the nature of the business, though there is no defined minimum. This is a popular route for British entrepreneurs. Note: E visas are non-immigrant visas — they do not lead to a Green Card automatically.

L-1 Intracompany Transferee Visa. For employees of multinational companies transferring to a US affiliate, subsidiary, or parent. Requires at least one year of employment with the company outside the US in the prior three years. L-1A (managers and executives) can lead to a Green Card via EB-1C.

O-1 Extraordinary Ability Visa. For individuals with extraordinary ability or achievement in sciences, arts, education, business, or athletics. High bar, but well suited to senior academics, artists, athletes, and certain business leaders.

H-1B Specialty Occupation Visa. For professional workers in specialty occupations requiring at least a bachelor's degree. Subject to an annual lottery (cap of 65,000 plus 20,000 for US master's holders). Heavily oversubscribed; your employer must be willing to enter the lottery on your behalf.

Green Card (Lawful Permanent Residence). The Green Card allows permanent residence. Routes relevant to UK expats:

• EB-1A/B/C: Extraordinary ability; outstanding researchers; multinational managers. No labour certification required. Most accessible for senior executives (EB-1C via L-1A).
• EB-2/EB-3: Professionals and skilled workers; requires employer sponsorship and labour certification (PERM process). Can take several years.
• EB-5 Investor: USD 1.05 million investment (USD 800,000 in targeted employment areas) creating at least 10 US jobs. Popular with HNW individuals for the speed to Green Card.
• Family-based: Spouse, child, or sibling of a US citizen or Green Card holder.
• DV Lottery (Diversity Visa): UK nationals are generally not eligible as the UK sends too many immigrants to the US each year.

US Tax — A Critical Difference

The US taxes based on citizenship and residency, not just residency. Green Card holders and US citizens are subject to US tax on worldwide income, no matter where they live. This is fundamentally different from every other major country's approach.

Once you become a US tax resident (Green Card holder, or meeting the Substantial Presence Test of 183 days in the US in a rolling three-year formula), you are taxed on worldwide income at US federal rates.

US federal income tax rates (single filer, 2026): Up to USD 12,400: 10%; $12,401–$50,400: 12%; $50,401–$105,700: 22%; $105,701–$201,775: 24%; $201,776–$256,225: 32%; $256,226–$640,600: 35%; above $640,600: 37%. (Thresholds are roughly double for married couples filing jointly.)

State income tax is additional and varies by state. Texas, Florida, Nevada, Washington, and South Dakota have no state income tax — a significant consideration for high earners.

FBAR (FinCEN 114). If you hold foreign financial accounts with an aggregate value exceeding USD 10,000 at any point in the year, you must file an FBAR report annually. Penalties for non-filing are severe — USD 10,000 per violation (or more for wilful violations). Your UK bank accounts, ISAs, pensions, and any offshore accounts all count.

FATCA (Form 8938). An additional disclosure requirement for specified foreign financial assets above higher thresholds. Filed with your US tax return.

The PFIC Trap. Passive Foreign Investment Companies (PFICs) include most non-US mutual funds, UK OEICs, ISA investments in funds, and UK unit trusts. The US tax treatment of PFICs is punitive — a complex excess distribution regime or mark-to-market election, both of which are unfavourable and administratively burdensome. UK expats who become US residents should liquidate their UK fund holdings before becoming US tax resident, or obtain specialist advice urgently if they have already crossed into US residency. UK ISAs have no recognised status in the US — gains and income within ISAs are taxable to US residents.

UK-US Double Tax Treaty. A comprehensive treaty; however, its interaction with US law is complex and US domestic law sometimes overrides treaty positions. UK government pensions are generally taxable only in the UK under the treaty.

Expatriation (Giving Up Green Card or Citizenship). Exiting US status (surrendering a Green Card or renouncing citizenship) triggers the "exit tax" if you are a "covered expatriate" (net worth over USD 2 million, or average annual net US income tax liability over USD 211,000 (2026 figure, inflation-adjusted annually) in the five preceding years, or failure to certify US tax compliance). The exit tax deems a disposal of all worldwide assets at fair market value on the expatriation date. This is a material cost of becoming US resident if you later wish to leave.

Banking

Banking in the US is generally straightforward for Green Card holders. For those on work visas, some banks require additional documentation:

• Chase, Bank of America, Wells Fargo, Citi — the Big Four retail banks; all accept visa holders with a valid Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN).
• HSBC USA — natural for existing HSBC customers; good for international transfers.
• Ally, Marcus (Goldman Sachs) — excellent online banking with competitive savings rates.

Maintaining your UK bank account is important — many UK banks now restrict services to non-UK residents, so act early (before departure) to move to an international account (HSBC Premier, Lloyds International, Barclays Premier International).

Healthcare

The US has no universal healthcare system. Employed individuals typically receive group health insurance through their employer (employer-sponsored plans cover approximately 55% of the population). Without employer cover, the options are:

• ACA Marketplace plans (Affordable Care Act/Obamacare) — available to legal residents; premiums are income-subsidised below certain thresholds.
• Short-term health plans — limited coverage; gaps are significant.
• Continuation coverage (COBRA) — extends employer cover after employment ends for up to 18 months; very expensive.

Healthcare costs in the US are among the highest in the world. A hospital inpatient stay can generate bills of USD 10,000–100,000 without comprehensive insurance. This is the single biggest financial risk area for UK expats in the US.

Social Security

After earning Social Security credits for 40 quarters (10 years) in the US, you become eligible for US Social Security retirement benefits. Contributions while working in the US build your credits. The UK-US Social Security Totalisation Agreement allows you to combine UK NI contributions and US Social Security credits for eligibility purposes, preventing double contributions.

Practical Considerations

• Social Security Number (SSN): Apply as soon as you have your visa and start work — needed for banking, tax filing, and most official purposes.
• Driver's licence: Varies by state. Most states require a test rather than exchange of a UK licence.
• Health insurance: Sort this before your first day of work — a gap in coverage can be expensive.
• Cost of living varies enormously: New York and San Francisco are among the most expensive cities in the world; Texas, Florida, and the Southeast are significantly more affordable.

How Global Investments Can Help

The US is the most financially complex destination for UK expats. The combination of worldwide taxation, FBAR/FATCA reporting, PFIC rules, exit tax exposure, and the interaction with UK obligations makes specialist cross-border advice essential rather than optional. Global Investments works with US-qualified tax advisers as part of a coordinated UK-US advisory service, helping clients restructure UK investments before departure, manage ongoing US compliance, and plan for eventual US exit. If you are considering a move to the US, speak to our team well before your planned move date.

This guide is for general information only. US tax law is complex and changes frequently. This guide does not constitute US tax advice. Always seek professional legal and financial advice — including from a US-qualified attorney and CPA — tailored to your circumstances before making relocation or investment decisions. Investments can fall as well as rise in value.