Introduction
A family office that spans the United States and the United Kingdom faces a compliance challenge unlike almost any other.
Multiple family members hold different nationalities. Assets sit in trusts, companies, and investment vehicles across both jurisdictions. Income flows from US securities, UK property, offshore funds, and private equity. And the tax rules in each jurisdiction apply simultaneously to the same assets and the same people.
Managing this requires a genuine US-UK cross-border tax specialist — not a generalist firm that occasionally handles international clients. It requires an adviser who understands both systems deeply and manages them as a single integrated engagement.
This guide explains what family office tax compliance looks like across the US-UK divide. It covers the key obligations, the most common failures, and what a first-class specialist advisory engagement delivers. Contact our US-UK cross-border tax advisory team at Jungle Tax for specialist guidance.
What Is a US-UK Cross-Border Tax Specialist?
The Definition
A US-UK cross-border tax specialist is a tax practitioner with deep, concurrent expertise in both US federal tax law and UK tax law.
This is not the same as an adviser who has handled a few international clients. A genuine specialist understands the Internal Revenue Code, the FBAR regulations, the FATCA reporting framework, and the US-UK Double Taxation Convention on the US side. On the UK side, they understand income tax, capital gains tax, inheritance tax, the offshore fund rules, and the trust regime.
For a family office, the specialist must also understand how these two systems interact — including the foreign tax credit mechanism, the treaty tie-breaker provisions, and the estate and gift tax treaty.
The IRS overview of international tax compliance for US persons is published at:
https://www.irs.gov/individuals/international-taxpayers/international-taxpayer-services
Why Family Offices Specifically Need This Expertise
A family office operates across a broader range of asset classes, entity types, and family member profiles than almost any other client category.
A typical multi-jurisdictional family office may include: US-citizen family members resident in the UK; UK-domiciled family members with US-situs assets; trusts settled under UK law with US beneficiaries; offshore investment vehicles that meet the PFIC definition; private equity interests with US and UK reporting requirements; and philanthropic structures in both jurisdictions.
Each of these elements creates specific compliance obligations. None of them can be managed in isolation. Only a genuine US-UK cross-border tax specialist can see and manage the full picture.
Who This Guide Is Written For
This guide is written for family office principals, chief investment officers, and family office managers who oversee multi-jurisdictional family structures.
It is equally relevant to private client advisers — solicitors, wealth managers, and family office administrators — who work alongside specialist tax advisers and need to understand the compliance landscape.
Why a US-UK Cross-Border Tax Specialist Matters More Than Ever in 2026
The Non-Domicile Reform Has Restructured UK Planning
From April 2025, the UK abolished the remittance basis for long-term UK residents. The new system taxes foreign income and gains on an arising basis after four years of UK residence.
For a family office where some members are non-UK-domiciled, this change requires a fundamental review of the existing planning framework. Structures that relied on the remittance basis to shelter offshore income from UK tax may now need to be restructured.
A US-UK cross-border tax specialist can model the impact of the new rules on the family’s existing structure and identify the most effective response.
The TCJA Sunset Threatens Significant US Exposure
The US federal estate and gift tax exemption is scheduled to revert from approximately $13.61 million to approximately $7 million after the end of 2025. For a family office with US-person members holding significant assets, this reduction is material.
The window to make large gifts under the current enhanced exemption closes at the end of 2025. Planning must begin immediately. Our related guide on https://www.jungletax.co.uk/irs-streamlined-filing-experts covers the sunset implications in detail.
CRS and FATCA Data Sharing Has Made Non-Compliance Visible
Together, the OECD Common Reporting Standard and FATCA create a near-comprehensive data-sharing framework. UK financial institutions report account information for US persons to HMRC. HMRC passes that data to the IRS.
A family office with unreported accounts, undisclosed trust interests, or unfiled information returns is therefore increasingly visible to both HMRC and the IRS. The risk of detection has risen significantly in the past decade. Proactive compliance — managed by a specialist — is far less costly than reactive remediation.
Key Compliance Obligations for a US-UK Family Office
US Information Returns for Foreign Entities
A US person who holds an interest in a foreign corporation may have an obligation to file Form 5471. This applies where the US person is an officer, director, or shareholder of a controlled foreign corporation.
A US person who holds an interest in a foreign partnership must file Form 8865. This covers interests in UK limited liability partnerships, Scots limited partnerships, and other foreign partnership structures commonly used in UK family offices.
A US person who is a grantor, beneficiary, or transferor of a foreign trust must file Form 3520. The trust itself — or the US owner on its behalf — may also need to file Form 3520-A annually.
Missing any of this information returns leaves the statute of limitations open indefinitely for the entire tax return. Penalties are substantial. A genuine US-UK cross-border tax specialist identifies all applicable information returns as part of the annual compliance program.
PFIC Reporting for Offshore Fund Holdings
A family office investment portfolio typically includes offshore fund vehicles. These may include UCITS funds, Cayman Islands feeder funds, Luxembourg SICAVs, and alternative investment structures.
From a US perspective, many of these vehicles meet the PFIC definition. A US person who holds a PFIC interest without making a timely election is subject to the excess distribution regime. This applies punitive interest charges on deferred gains going back to the year of acquisition.
Annual Form 8621 filings are required for each PFIC. The correct election — mark-to-market, qualified electing fund, or excess distribution — must be made for each position. The IRS Form 8621 instructions are published at:
https://www.irs.gov/instructions/i8621
UK Trust Reporting and the Trust Registration Service
Since 2022, most UK express trusts — including family discretionary trusts — have had to be registered with HMRC’s Trust Registration Service. Failure to register carries a penalty of £100 per trust.
For a family office with multiple trusts, this is a material compliance obligation. It is separate from the annual trust tax return obligations and the potential US reporting requirements under Forms 3520 and 3520-A.
A US-UK cross-border tax specialist manages the Trust Registration Service obligations alongside the US trust reporting requirements as part of an integrated compliance calendar.
How a US-UK Cross-Border Tax Specialist Structures a Family Office Compliance Engagement
A family office compliance engagement requires a structured approach. Every element must be coordinated across both jurisdictions.
Step one — Family and entity mapping.
The specialist maps every family member — their nationality, residence, domicile, and relationship to each entity. Every trust, company, partnership, and investment vehicle is identified. The ownership and control structure of each entity is documented.
Step two — Compliance gap analysis.
The specialist reviews the prior year compliance position in both jurisdictions. All required returns, information returns, FBAR, and FATCA filings are identified. Gaps and errors are documented with their potential penalty exposure.
Step three — PFIC assessment.
Every offshore fund holding is assessed for PFIC status. The correct election is confirmed or established for each position. Any prior-year PFIC exposure is quantified, and a remediation strategy is designed.
Step four — Annual filing calendar.
A comprehensive filing calendar is established. This covers UK self-assessment for all relevant family members, US federal returns (Form 1040 or 1040NR as applicable), FBAR filings (FinCEN Form 114), Form 8938, Form 8621 for PFIC holdings, Forms 5471, 8865, 3520, and 3520-A as applicable, and any UK trust tax returns and Trust Registration Service obligations.
Step five — Foreign tax credit optimization.
The foreign tax credit position is modeled for each family member. UK tax paid on each category of income is applied against the corresponding US liability. The credit is calculated within the correct income baskets under IRC Section 904.
Step six — Estate and gifting strategy.
The combined UK IHT and US estate and gift tax exposure is modeled for each family member.—a coordinated gifting program designed based on the annual exclusions in both jurisdictions. The pre-TCJA sunset window for large gifts is assessed.
Step seven — Year-round advisory support.
The specialist provides real-time input on planning decisions throughout the year. This includes fund restructurings, trust distributions, property transactions, and family member relocations. The HMRC guidance on reporting requirements for offshore structures is published at:
https://www.gov.uk/guidance/register-a-trust-as-a-trustee
Case Study — A Multi-Generational Family Office with US and UK Members
The Ashworth family office manages assets of approximately £45 million across four family branches.
The founding generation — a UK-domiciled British couple — are in their late seventies. Their two children are both UK residents. One married a US citizen; their three children are dual US-British nationals. The other branch has no US connections.
The family office holds: a UK investment portfolio managed through a family discretionary trust; two Cayman Islands fund interests held personally by US-person family members; a private equity co-investment through a Scots limited partnership; commercial property in the UK held through a limited company; and a philanthropic foundation registered in the UK.
When the family office approached Jungle Tax, the compliance position had several serious gaps.
First, neither Cayman fund had been assessed for PFIC status. Both met the income test. Form 8621 had never been filed.
Second, the Scots limited partnership interest had never been reported on Form 8865. The statute of limitations on all returns for the relevant years was therefore open indefinitely.
Third, the family discretionary trust had not been registered with the Trust Registration Service. And the U.S. person beneficiaries had never filed Form 3520 for distributions received.
Fourth, the non-dom planning for one of the children — who had been a UK resident for seven years — had not been reviewed since the April 2025 reforms. They were now on the arising basis without any planning adjustment.
Jungle Tax coordinated a full remediation exercise across all four issues.
PFIC elections were established for both Cayman funds. Form 8865 was filed for the Scots LP for the relevant years. The Trust Registration Service was completed. Form 3520 was filed for the affected beneficiaries.
A revised planning framework was designed for the non-dom family member under the new rules. A coordinated gifting program was established for the US-person grandchildren using the pre-sunset exemption.
The family office now operates under a unified annual compliance program managed by Jungle Tax across both jurisdictions. Contact our US-UK cross-border tax specialist team at hello@jungletax.co.uk or 0333-8807974 if your family office faces similar challenges.
Common Mistakes to Avoid When Engaging a US-UK Cross-Border Tax Specialist
Using Separate UK and US Advisers Who Do Not Communicate
The most fundamental error is managing UK and US compliance as two entirely separate exercises.
The foreign tax credit, the trust reporting requirements, the PFIC election strategy, and the estate planning must all be designed with full knowledge of both jurisdictions. When neither adviser sees the full picture, errors in one jurisdiction create problems in the other. A US-UK cross-border tax specialist who manages both sides of the border eliminates this risk.
Failing to File Form 8865 for UK Partnership Interests
Scottish limited partnerships and other UK partnership structures are commonly used in family office contexts. A US person with an interest in such a structure must file Form 8865 annually.
Missing Form 8865 leaves the statute of limitations open indefinitely for the entire tax return. The penalty for failing to file is $10,000 per year per partnership. The IRS Form 8865 instructions are published at:
https://www.irs.gov/instructions/i8865
Not Registering UK Trusts with the Trust Registration Service
Since 2022, most UK express trusts have had to be registered with HMRC’s Trust Registration Service. Many family offices have multiple trusts that remain unregistered.
Registration is a separate obligation from the annual trust tax return. Failure to register carries a penalty of £100 per trust. A US-UK cross-border tax specialist includes Trust Registration Service compliance in the annual compliance calendar.
Ignoring the Trust Registration Service for Offshore Trusts with UK Assets
Offshore trusts — including those established in Jersey, Guernsey, or the Cayman Islands — may also have UK Trust Registration Service obligations if they hold UK assets or have UK-resident beneficiaries.
This is frequently overlooked by family offices that assume only UK-law trusts need to register. The scope of the obligation is broader than many advisers realize.
Missing the Pre-Sunset Gifting Window for US-Person Family Members
The TCJA enhanced estate and gift tax exemption closes at the end of 2025. Gifts made under the current enhanced exemption are not subject to clawback when the exemption reverts.
For a family office with US-person members who hold significant assets, failing to review this opportunity before the window closes is a costly omission. The planning analysis must happen now.
How Jungle Tax Can Help — Specialist US UK Cross-Border Tax Specialist for Family Offices
Jungle Tax is a specialist US-UK cross-border tax advisory firm. Our team includes IRS Enrolled Agents and UK-qualified tax practitioners with specific experience in family office compliance.
We manage the full compliance picture — UK self-assessment, US federal returns, FBAR and FATCA filings, information returns (Forms 5471, 8865, 3520, 3520-A, 8621), Trust Registration Service obligations, and estate and gifting strategy — as a single integrated annual engagement.
We are not a reactive compliance firm. We provide year-round advisory input on planning decisions — fund restructurings, trust distributions, family member relocations, and pre-TCJA-sunset gifting. We work directly with the family office’s other advisers — solicitors, wealth managers, and family office administrators — to ensure the tax advice and the legal and investment decisions are fully aligned.
You can find further information on our US expat tax advisory service page, or read our related guide to US-UK tax services for HNW investors.
If your family office has US-UK compliance challenges that are not currently being managed as a single, integrated engagement, contact our US-UK cross-border tax specialist team at hello@jungletax.co.uk or call 0333-8807974 today.
Conclusion
Family office tax compliance across the US-UK divide is one of the most technically demanding challenges in private client tax. It requires a genuine US-UK cross-border tax specialist who manages both systems as a single, integrated engagement.
Three points from this guide matter most.
First, information returns — Forms 5471, 8865, 3520, and 3520-A — are routinely missed in multi-jurisdictional family office structures. Missing them leaves the statute of limitations open indefinitely.
Second, PFIC exposure in offshore fund holdings is the most commonly identified and most costly compliance failure in this client profile.
Third, the pre-TCJA sunset gifting window closes at the end of 2025. U.S. persons with significant estates should be acting now.
Managing all of these dimensions simultaneously requires a dedicated specialist. The cost of getting it right is modest. The cost of getting it wrong is not.
Speak to a Jungle Tax adviser today — contact us at hello@jungletax.co.uk or visit our US-UK tax advisory service page to learn more.
