The Moving-Year Tax Return: What Happens When You Relocate Between the US and the UK

The year you move between the United States and the United Kingdom, your taxes do not hand over cleanly from one country to the other — for a stretch of months, both systems have a claim on you at once. An American moving to the UK keeps filing a full-year US return regardless, while the UK may split its tax year into a non-resident part and a resident part; a UK person moving to America typically becomes a dual-status taxpayer, non-resident for part of the year and resident for the rest. Handled early, the overlap is a coordination exercise; handled late, it is where double taxation and missed filings actually happen.

Key takeaways

• US citizens and green card holders file a full-calendar-year Form 1040 in the moving year, wherever they live — moving to the UK does not change that.
• The UK's statutory residence test decides when UK residence begins or ends, and split-year treatment (HMRC's RDR3 guidance) can divide the year — but only where specific conditions are met.
• A UK person arriving in the US usually files a dual-status return for the arrival year: taxed as a non-resident before residency starts and on worldwide income after.
• The most valuable moving-year planning happens before the flight: gains, bonuses, ISAs and pension positions are best reviewed before you land, not after.
• The UK tax year (6 April to 5 April) and the US calendar year never line up, so every moving year is really two overlapping filings in each country's terms.
• FBAR reporting and state residency are the two traps that catch otherwise well-advised movers most often.

Moving to the UK: the American's first year

Your US return does not stop

The United States taxes its citizens and green card holders on worldwide income wherever they live. The year you move to London, you still file a full-year Form 1040 covering January to December — your US filing obligation follows your passport, not your address. What changes is everything around it: new foreign accounts to report, UK income and tax to bring into the return, and a second tax authority with its own view of the same months.

The UK side: the statutory residence test and split-year treatment

Whether and when you become UK tax resident is decided by the statutory residence test — a mechanical set of day-count and connection rules set out in HMRC's RDR3 guidance. If you are UK resident for a tax year, the default is that you are resident for the whole of it, including the months before you arrived. Split-year treatment is the relief that divides the year into an overseas part and a UK part, so that the UK broadly taxes you as a resident only from the point the UK part begins.

The catch is that split-year treatment is not something you elect into because it seems fair. It applies only where one of a defined set of cases fits your facts — starting full-time work in the UK, acquiring your only home there, joining a partner who has already moved, and so on — and the date the year splits depends on which case applies. Two people who land on the same flight can have different split dates. Pin this down first, because it sets the boundary line for everything else in the year.

Your first Self Assessment

Most new arrivals with anything beyond simple PAYE employment — US investment income, a rental property back home, self-employment, equity compensation — will need to register for Self Assessment and file a UK return for the arrival year. It runs on a different rhythm from US filing: the UK tax year ends on 5 April, and the return covering your arrival may fall due many months after the US return covering the same period. Diarise both from the start, because the order in which the two returns are prepared affects how foreign tax credits are claimed on each side.

FEIE timing when the move splits the test

Many Americans abroad reduce US tax on salary through the foreign earned income exclusion, and its physical presence test — 330 full days in foreign countries within a 12-month period — does not have to match the calendar year. In a moving year, the qualifying 12-month period usually starts with the move and runs into the following year, which often means filing on extension so the days can accrue before the return is finalised. Whether the exclusion, foreign tax credits, or a blend produces the better result for a UK move is genuinely fact-specific — UK tax rates and the treaty often make credits the stronger tool — and it is worth modelling both before the first return goes in, because some of these choices are sticky once made.

Double tax relief in the overlap

For the overlap months, both countries may tax the same income. The US–UK treaty and each country's foreign tax credit rules exist to stop that being permanent, but relief is claimed, not automatic — and timing mismatches, where UK tax is paid in a later year than the one in which the US counts the income (or vice versa), can create temporary double payment that is only recovered on a later return. This is bookkeeping-intensive rather than conceptually hard, but it is where DIY moving-year returns most often leak money.

Moving to the US: the dual-status year

Part non-resident, part resident

A UK person who moves to the US mid-year typically has a dual-status year: for the part of the year before US residency begins, the US taxes only US-source income; from the residency start date, it taxes worldwide income. The mechanics — a return for the resident portion with a statement for the non-resident portion — are described on the IRS's dual-status alien pages, and dual-status returns carry their own restrictions, on the standard deduction and filing status among other things, that make them worth professional hands. In some situations an election to be treated as a resident for the full year is available and beneficial; in others it is expensive. It is an analysis, not a default.

When US residency actually starts

US tax residency generally begins under one of two tests: the green card test, or the substantial presence test, a day-counting formula over the current and two prior years. Your residency start date is usually tied to your first day of presence in the year you meet the test — which can be earlier than you expect. House-hunting trips, onboarding visits and conferences before the move are not tax-trivial: they can pull the residency start date backwards, and with it the boundary between income the US ignores and income it taxes in full.

Review before you land

The single most valuable habit for UK-to-US movers: have your affairs reviewed before you land, not after. Once you are a US tax resident, the US view of your UK financial life applies wholesale — and it is not a generous view. ISAs lose their tax-free character for US purposes and often hold funds the US taxes punitively; gains that could have been realised efficiently before the move are taxed in full after it; a bonus or share vesting that lands a few weeks either side of the residency start date can be taxed very differently. UK pensions bring their own reporting and treaty questions — see our guide to US taxation of UK pensions and SIPPs. None of this needs exotic planning. It needs a pre-arrival review while the choices still exist.

The UK departure side

Leaving the UK is its own half of the moving year. Split-year treatment on departure has its own cases, a final Self Assessment is often needed, and continuing UK income — a rental property, UK dividends, deferred compensation — keeps a UK filing thread alive even after you become non-resident. The UK also has rules aimed at short-term leavers who realise gains while away and then return, so a move intended to be temporary deserves particular care before anything is sold.

The traps both directions share

Two tax years that never line up

The UK tax year runs 6 April to 5 April; the US uses the calendar year. Every UK document you receive covers parts of two US tax years, and every US document parts of two UK years. Income has to be apportioned, exchange rates applied consistently, and foreign tax credits matched to the right period on the other side. This is the unglamorous core of moving-year work — and it is why the two returns should be prepared in the right order by one pair of hands, not by two advisers who never speak to each other.

FBAR and foreign account reporting

Moving money moves you across thresholds. A US person whose foreign accounts exceed the FBAR reporting threshold at any point in the year must file — and a moving year is exactly when balances spike: a US account converted to pounds for a house purchase, a relocation payment landing in a new UK account, savings consolidated for the move. The test looks at the highest balance during the year, not the position on 31 December. New arrivals to the US acquire the same obligation over their existing UK accounts once they become US persons, and Form 8938 FATCA reporting runs alongside with its own thresholds.

State residency does not end at the airport

For Americans leaving, and for new arrivals alike, the states run their own residency rules — and some, notably California and New York, are famously reluctant to let residents go. Keeping a home, a driving licence or professional ties in a sticky state can keep you on the hook for state tax long after the federal picture has settled abroad. Movers in the other direction acquire a state filing obligation from early on in most states. We cover the exit side in detail in state taxes for US expats leaving California and New York.

Running the moving year well

A well-run moving year looks like this: a pre-move review while planning choices still exist; a clear, evidenced position on residency start and end dates in both countries; both returns prepared in a deliberate order by advisers who see the whole picture; credits matched across the mismatched year-ends; and account reporting swept once, properly. At Next Tax Source, US–UK cross-border tax is the core of what we do, and a licensed CPA or Enrolled Agent reviews and signs off every return before anything is filed. If a transatlantic move is on your calendar — in either direction — book a confidential consultation before you book the flight, and we will map your moving year properly.

This article is general information, not tax advice, and does not create a professional relationship. Residence rules, elections and reporting thresholds are fact-specific and change; confirm the current position with a licensed professional before acting.

---

Reviewed by a CPA / Enrolled Agent. Last updated: 4 September 2026.

Official sources: IRS — Taxation of dual-status aliens | IRS — Substantial presence test | IRS — Foreign earned income exclusion | HMRC — RDR3: statutory residence test | GOV.UK — Self Assessment | IRS — FBAR