US Back Tax Calculator for Expats

Yes. All US citizens and green card holders must file a Form 1040 annually regardless of where they live, if income exceeds the filing threshold (approximately $14,600 for a single filer in 2024). The obligation exists even if no US tax is owed after applying the Foreign Tax Credit or FEIE.

The FEIE (Form 2555) allows qualifying expats to exclude up to $126,500 (2024) / $130,000 (2025) of foreign earned income from US taxable income. To qualify, you must pass either the Physical Presence Test (330+ full days outside the US in a 12-month period) or the Bona Fide Residence Test (established permanent residency in a foreign country).

The FTC (Form 1116) provides a dollar-for-dollar reduction in US tax for foreign income taxes paid. For UK residents paying 20–45% UK income tax on income that would be taxed at lower US rates, the FTC typically eliminates US tax liability entirely, often resulting in excess credits that can be carried forward.

Almost always FTC for UK residents. UK income tax rates (20% basic, 40% higher, 45% additional) exceed the equivalent US rates on the same income. The FTC produces a dollar-for-dollar credit equal to UK tax paid, which typically eliminates US liability entirely. FEIE is more advantageous in low-tax or zero-tax jurisdictions (UAE, Cayman Islands, etc.).

An IRS amnesty programme for US expats who did not know they were required to file US tax returns. It allows you to file 3 years of delinquent returns and 6 years of FBARs with a non-willfulness certification. Most clients living in the UK owe little or no US tax after applying the FTC, and Streamlined waives all penalties.

No. The FEIE applies only to foreign earned income (wages, salary, self-employment income). Passive income — including interest, dividends, capital gains, and rental income — is not covered by the FEIE and remains fully subject to US tax (though the FTC may offset the liability).

Yes, but you cannot apply both to the same income. Typically, FEIE is applied to earned income up to the exclusion limit, and the FTC is applied to passive income and any remaining earned income above the FEIE limit. This can be an efficient strategy in some circumstances, though most UK residents achieve the best outcome using FTC alone.

The FBAR (FinCEN Form 114) must be filed by any US person with foreign financial accounts (bank accounts, ISAs, SIPPs, pensions, investment accounts) with an aggregate value exceeding $10,000 at any point during the calendar year. It is filed electronically with FinCEN by October 15 and is separate from the Form 1040 tax return.