FATCA Letter from Bank – Accidental American Living in UK
I recently received a “self-certification for individuals” from my UK bank requesting a FATCA declaration of US citizenship. As a result, I, like many others, have gone down the US tax rabbit hole to fulfill my US tax obligations. I was born in Europe and have never lived or worked in the United States. I have been living in the UK as a European (have a Greek passport) since 2008 and have always paid my taxes etc on time. I of course learned the simplified procedure and started the application process only for I found this forum which made me question this decision. Is a FATCA declaration letter from a bank really a sufficient reason to request the simplified procedure?
A few things to mention for context:
- I make over $100,000 a year and have about the same in my UK bank account
- I work for a UK subsidiary of an American company
- I am lucky to have received RSUs from this company for which I registered as a European via a W8-Ben. Having little knowledge of how RSUs work, I opted to automatically sell RSUs to cover US tax on the acquisition of the shares and tax is withheld, etc.
- I have several UK pensions which my employers and I have contributed to
- I vaguely remember mentioning to my bank that I had dual citizenship when opening my bank account in 2015
- I am planning to permanently move to Cyprus (where my wife is from) in about a year and will be closing/withdrawing all my money from the UK bank
- Might not matter, but I’ve also dabbled in cryptocurrency over the years and traded crypto using USD
The bank requires me to respond to them within a month and declare my tax residency. My original plan was to request the simplified procedure and then respond to the bank. Currently, where I am, I have prepared all my tax (3 years) and FBAR (6 years) reports on taxesforexpats.com, however, they will probably take 3 weeks to review everything and be ready to file.
So I guess my multiple questions are:
1) Do I even have to bother entering the US tax system? If so, should I respond to the bank and continue with my current plan even though it will take almost a month to submit? If not, what are the risks of submitting the FATCA declaration and not paying my US taxes?
2) Since I was unaware of my US tax obligations, should I capitalize on the fact that I can now take advantage of the amnesty program?
3) Should I transfer my savings out of this UK bank now? Is this a red flag?
I would very much appreciate any advice on how to do this.
Thanks!
