If you hold a US Green Card and live in the United Kingdom, you remain a US tax resident for federal income tax purposes — obligated to file annual US tax returns, report worldwide income, and comply with FBAR and FATCA reporting requirements. Many Green Card holders living abroad are unaware of the full scope of these obligations, which are identical in most respects to those of US citizens living overseas.
Green Card Holders Are US Tax Residents
Under the Internal Revenue Code (IRC Section 7701(b)), a lawful permanent resident (Green Card holder) is classified as a US resident alien for tax purposes. This means:
- You must file a US Form 1040 every year, reporting your worldwide income — regardless of where you earn it or where you live
- You must report all foreign bank and financial accounts via FBAR (FinCEN Form 114) if your aggregate foreign account balances exceed $10,000 at any point during the year
- You must report foreign assets under FATCA (Form 8938) if relevant thresholds are met
- Your UK income is taxable in the US (with credit for UK taxes paid via the Foreign Tax Credit)
- The Foreign Earned Income Exclusion (FEIE) is available to Green Card holders meeting the same tests as US citizens — either the Bona Fide Residence Test or the Physical Presence Test
Does Living in the UK End Your US Tax Obligations?
No. Physical residence outside the United States does not suspend or terminate your US tax residency as a Green Card holder. Your Green Card tax status continues until:
- You formally abandon your Green Card by filing Form I-407 (Abandonment of Lawful Permanent Resident Status) with USCIS, or
- A US court issues a final administrative order of abandonment
Merely living outside the US for years, allowing your Green Card to expire, or not renewing it does not terminate your US tax obligations. Many Green Card holders are surprised to learn they owe US taxes on years of income earned and banked in the UK — with penalties for late FBAR filings accumulating during that period.
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Green Card Holders and the US-UK Tax Treaty
The US-UK Tax Treaty applies to Green Card holders in specific circumstances, but with an important caveat: the treaty’s “saving clause” under Article 1(4) allows the US to tax its residents (including Green Card holders) as if the treaty did not exist. This means treaty benefits that reduce US tax are not always available to Green Card holders in the same way they might be to non-resident aliens.
However, the treaty does provide benefits in areas such as:
- Pension income (Articles 17 and 18) — the UK pension/SIPP treatment discussed in our SIPP and US Tax guide
- Relief from UK withholding tax on dividends and interest
- Tie-breaker rules for determining residency for treaty purposes (though Green Card holders face limitations here due to the saving clause)
FBAR Requirements for Green Card Holders
Green Card holders have identical FBAR obligations to US citizens. If at any point during the calendar year your combined balance in all foreign financial accounts exceeds $10,000, you must file FinCEN Form 114 by April 15 (with an automatic extension to October 15).
For UK residents, this typically includes:
- UK current and savings accounts
- UK ISAs (Cash and Stocks and Shares)
- UK pension accounts (SIPPs, workplace pensions)
- Any other foreign financial accounts
The penalties for wilful failure to file FBAR can be severe: up to the greater of $100,000 or 50% of the account balance per violation. See our detailed FBAR Filing 2026 Guide for full details.
Abandoning Your Green Card: The exit tax Risk
If you decide to abandon your Green Card after holding it for a significant period, you may be subject to the exit tax under IRC Section 877A. Green Card holders who have held the card for at least 8 of the past 15 tax years are classified as “long-term Green Card holders” and are potentially subject to the exit tax if they meet the covered expatriate tests.
See our detailed US Exit Tax 2026 Guide for a full explanation of the rules, thresholds, and planning opportunities.
Catching Up on Missed US Tax Returns
Many Green Card holders living in the UK were never told they needed to continue filing US returns after moving. If you are behind on your US tax filings, the IRS Streamlined Filing Compliance Procedures offer a pathway to catch up with reduced penalties, provided your non-compliance was non-wilful. The Streamlined Foreign Offshore Procedure applies to Green Card holders living abroad and requires filing 3 years of back returns and 6 years of FBARs, with a 5% offshore penalty (or zero penalty in many cases).
Frequently Asked Questions: Green Card Holders in the UK
I have not filed US returns in 10 years. What are my options?
The IRS Streamlined Foreign Offshore Procedure is the primary pathway for non-wilful non-filers. It requires 3 years of back tax returns, 6 years of FBARs, payment of any outstanding taxes plus interest, and a 5% miscellaneous offshore penalty on the highest aggregate value of foreign assets. If implemented correctly, you achieve full compliance without criminal exposure. Contact us to discuss your situation in confidence.
Can my Green Card expire while I live in the UK?
Yes — the physical Green Card (Form I-551) expires, typically after 10 years, but your status as a lawful permanent resident does not expire with the card. However, if you have been outside the US for extended periods, USCIS may question whether you have abandoned your residency at the border. This is a separate immigration issue from the tax question — both need professional attention.
Does the UK-US Social Security Totalization Agreement affect Green Card holders?
Yes. The US-UK Totalization Agreement prevents double payment of Social Security/National Insurance contributions. If you are employed in the UK and paying National Insurance, you are generally exempt from US self-employment tax on that income. The agreement also allows combining US and UK contribution periods for benefit eligibility purposes.
What if I am married to a UK citizen?
Your UK citizen spouse is generally a “non-resident alien” for US purposes and does not have US filing obligations on their own. However, if you file a joint US return with your UK spouse (which can reduce your tax in some cases), they must provide an ITIN or Social Security number. Filing jointly means your UK spouse consents to worldwide income taxation — a decision that requires careful analysis.
Get Specialist Advice on Your Green Card Tax Position
Green Card holder taxation is frequently misunderstood, and the consequences of non-compliance can be significant. Whether you need to catch up on missed returns, optimise your current tax position, plan for abandonment, or coordinate UK and US reporting, our team can help.
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