US $14oo Economic Stimulus Payment. UK tax?

UK national and tax resident receives $1400 Economic Stimulus Payment from US Government. Tax in UK?

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A UK domiciled tax resident[formerly US resident under green card] receives an unsolicited $1400 from US government under the 2021 Economic Stimulus plan. In US this is categorised as a tax credit. Individual ceased to tax file in US after 2019 .

Is there any UK tax assessable on this receipt?

Replies (4)

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By David Treitel
09th May 2021 09:07

First question. Was the green card abandoned by filing Form I-407? If not, your client is still a US person. Second question. The $1,400 you mention is commonly known as EIP1. There are also EIP2 and EIP3 payments. Did your client receive these? Is your client entitled to receive these?

I am pleased to report that I asked and persuaded HMRC that the EIP is not UK taxable. I am more concerned however that you establish whether or not your client has filed Form I-407, a dual status US tax return for the year of abandonment of the green card and (if the green card was held long-term) expatriation tax Form 8854. If there any unsettled US tax issues it would be prudent you altered the client at this stage.

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Replying to David Treitel:
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By johnhemming
09th May 2021 16:41

David Treitel wrote:

If there any unsettled US tax issues it would be prudent you altered the client at this stage.


Most typos are the transposition of characters, but this produces a curious alternative.
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By Montrose
09th May 2021 16:31

David
Thanks. I was wrong in assuming the individual concerned had had a green card. He received an EIP3 payment. In previous years his income had been too high to qualify for EIP1 or EIP2.
Can you publicize HMRC's comments-perhaps through ICAEW TTax Faculty?
Montrose

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By Montrose
09th May 2021 16:31

David
Thanks. I was wrong in assuming the individual concerned had had a green card. He received an EIP3 payment. In previous years his income had been too high to qualify for EIP1 or EIP2.
Can you publicize HMRC's comments-perhaps through ICAEW TTax Faculty?
Montrose

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