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US citizens in the UK · Getting started

Where a US citizen in the UK can save, and how the US taxes each

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A US citizen living in the UK can use most of the places a UK saver uses, and the US taxes nearly all of them. The UK tax break on an ISA or a Premium Bond prize does not carry onto a US return. A pension is the one the US-UK treaty has an article for.

This page sets the options side by side. Each row says who will open it for a US citizen, what the UK does with the return, what the US does with it and what ends up reported. It describes and does not recommend: the order is the order the rest of the site runs in, and nothing here is ranked. Each row links to the page that explains it in full, with its sources.

The options, side by side

Where Who opens it for a US citizen UK tax US tax What gets reported
Savings account
Filing a US tax return from the UK 		Of the 65 providers checked that offer a savings account, 48 open one for a US citizen outright, 4 attach conditions and 13 refuse. Savings accounts, by provider. Interest can bear UK tax. Interest is ordinary income on your US return wherever the account is. Where UK tax is paid on the same interest, the foreign tax credit usually offsets the US bill. The bank reports the account under FATCA. You count it towards the FBAR and Form 8938.
Premium Bonds
Premium Bonds for US citizens 		NS&I sells them to anyone aged 16 or over with a UK bank account, up to £50,000 each. Its customer agreement sets no test of nationality or of where you pay tax. Prizes are free of Income Tax and Capital Gains Tax. The IRS has never ruled. On the conservative reading a prize is ordinary income, and with no UK tax paid there is nothing to credit against it. They count towards Form 8938. Whether they belong on the FBAR is unsettled.
Cash ISA
How the US taxes your ISA 		Of the 37 providers checked that offer a cash ISA, 28 open one for a US citizen outright, none attach conditions and 9 refuse. Cash ISAs, by provider. Interest is tax-free. The US ignores the wrapper. Interest is ordinary income in the year it is earned. The provider reports the account under FATCA. You report the interest on your US return and, if balances are high enough, the account on the FBAR and Form 8938.
Stocks and shares ISA
How the US taxes your ISA 		Of the 46 providers checked that offer a stocks and shares ISA, 1 opens one for a US citizen outright, 16 attach conditions and 29 refuse. Stocks and shares ISAs, by provider. No UK tax on growth or income inside it. Gains and dividends are taxable. UK funds inside are almost all PFICs, taxed at the highest ordinary rate with an interest charge. Individual shares avoid the PFIC rules and still lose the US shelter. The provider reports the account under FATCA. Each PFIC generally needs its own Form 8621 every year, and an ISA counts towards the FBAR.
Workplace pension
How the US taxes your UK workplace pension 		Your employer enrols you. Nothing in the automatic enrolment rules turns on nationality, so a US citizen is enrolled like anyone else. Contributions get UK tax relief. Usually up to 25% can be taken as a tax-free lump sum, capped at £268,275. The treaty keeps contributions made through a UK employer, and the benefits that build up from them, off your US return, up to what a comparable US plan would allow. A pension paid out is taxable, and the US can tax the lump sum too. The scheme reports nothing about you. You report it on the FBAR and Form 8938, and a trust-based scheme can be a foreign trust for Form 3520.
SIPP
How the US taxes a UK SIPP 		Of the 52 providers checked that offer a pension, 5 open one for a US citizen outright, 27 attach conditions and 20 refuse. SIPPs, by provider. Contributions get UK tax relief, and 25% can be taken as a tax-free lump sum. The US Treasury reads the treaty as leaving growth untaxed until you draw it, though the treaty's own words are narrower. Nothing in it relieves what you pay in yourself. What you take out is taxable, the lump sum included. It counts on the FBAR and Form 8938. The foreign trust forms arise far less often than for a trust-based workplace scheme.

What the table leaves out

The reporting forms have their own thresholds, and they are not the same ones: the FBAR starts at $10,000 across every account, and Form 8938 starts far higher for someone living abroad. Why funds are the problem inside an ISA, and what people hold instead, is on the PFIC page. What the treaty does and does not protect is on the US-UK treaty page.

Dollar savings are not in the table. Which UK accounts pay a US citizen interest on a dollar balance has not been checked yet; what is known is on the multi-currency account page. Saving for a child raises its own questions, set out on saving for a US citizen child.

Narrowing it down

The account finder filters the accounts on this site by what you are saving for and shows the reason beside each one. It narrows and does not choose. Which of these fits your own income and UK tax position is a question for a cross-border specialist.

Common questions

Where should a US citizen in the UK keep their savings?

Momo does not pick one, and what separates the options is how the US taxes each. The US taxes the interest in a savings account and in a cash ISA as ordinary income, because it ignores the ISA wrapper, and on the conservative reading it taxes a Premium Bond prize too. A stocks and shares ISA holding UK funds brings the PFIC rules on top. A pension is the one kind of UK saving the US-UK treaty has an article for. Which of those fits depends on your income, your UK tax and how long the money can be tied up, so confirm your position with a cross-border specialist before you act.

Is any UK savings product tax-free for a US citizen?

Not on a US return. A cash ISA and a stocks and shares ISA are tax-free in the UK, and the US taxes the interest, dividends and gains as if the wrapper were not there. Premium Bond prizes are free of UK tax, and with no IRS ruling the conservative reading taxes them as ordinary income. The nearest thing is a pension: the US Treasury reads the US-UK treaty as leaving growth in a UK pension untaxed by the US until it is drawn, which defers the tax rather than removing it.

Confirm your own position with a cross-border specialist. Acceptance policies and tax rules change, and your facts may differ from the general case. Rates and terms here are the provider's published figures rather than an offer, and the provider decides each application on its own criteria. Use this as a map, not a ruling. Last checked .
Accounts

Savings accounts

Which UK savings accounts accept US citizens, which ask for extra paperwork, and which say no. Per-provider verdicts and the reporting rules behind them.

 Accounts

Cash ISAs

A cash ISA is tax-free to HMRC but not to the IRS. Which UK providers open one for a US citizen, and why the US still taxes the interest.

 Tax

Premium Bonds

Premium Bond prizes are free of UK tax. On a US return the conservative reading treats them as gambling winnings: taxable, with nothing withheld.

 Tax

ISA US tax

The IRS does not recognise the ISA wrapper. Cash ISA interest and stocks ISA gains are taxable on your US return, and fund holdings drag in PFIC rules.

 Tax

Workplace pension US tax

The US-UK treaty relieves a US citizen's UK workplace pension contributions, up to US plan limits. What it covers, where it stops, and what still gets reported.

 Tax

SIPP US tax

The US Treasury reads the treaty as leaving UK SIPP growth untaxed until drawn; the treaty's wording is narrower. Contributions, growth and drawdown explained.

 Tax

PFIC

Almost every UK-domiciled fund is a PFIC, taxed by the US at punitive rates with heavy filing. This is why US citizens hold individual shares, not UK funds.

 More

Find accounts

Say what you are trying to do and see which UK accounts a US citizen can open for it, with the reason beside each one and the date it was last updated.