Freelancing while living in the U.K. seems straightforward. You invoice, you get paid, you do the work you care about. But then tax season shows up, and things get… weird, especially if you’re an American citizen on a partner visa.
Because here’s the thing: even if you’ve fully settled into your British life, the IRS hasn’t forgotten about you. U.S. tax obligations don’t vanish just because you’ve moved across the Atlantic. And when you’re self-employed, the rules get a little more tangled.
Let’s try to untangle them.
You Still Have to File With the IRS
The U.S. taxes its citizens (and green card holders) no matter where they live. So, yes, even though you’re earning in pounds, paying rent in pounds, and thinking in pounds, your freelance income still needs to be reported in dollars to the IRS.
You’ll file the usual Form 1040, but that’s just the start. If you’re self-employed, you’ll also need to complete Schedule C (for income and expenses) and Schedule SE (for self-employment tax). The IRS sees you as running a business, even if it’s just you and a laptop.
Many Americans living abroad don’t end up owing much to the IRS because of exclusions and credits, but that doesn’t mean you can skip the paperwork. The filings are still required—every year.
Oh, and there’s a little quirk: while expats get an automatic filing extension until June 15, any taxes owed are technically due by April 15. It’s one of those annoying details that’s easy to overlook until you get hit with interest.
Meanwhile, You’re Also on the Hook in the U.K.
The U.K. doesn’t care about your citizenship; it cares where you live. If you pass the Statutory Residence Test (which many partner visa holders do, by default), you’re a tax resident in the U.K., and HMRC wants to know about all your income, including freelance work.
That means you’ll need to:
- Register as self-employed with HMRC
- File a Self Assessment tax return each year
- Pay income tax and National Insurance on your profits
Now, your partner visa permits you to work, but it doesn’t get you out of filing. That part’s all yours. It’s also worth mentioning that the U.K.’s tax year runs from April to April, not the calendar year, like in the U.S. So, yes, there are two sets of deadlines, two systems, and often two currencies.
Can You Avoid Being Taxed Twice?
Usually, yes. Assuming you use the tools available under the U.S.-U.K. tax treaty. There are two main strategies:
- Foreign Earned Income Exclusion (FEIE) – If you qualify through physical presence or bona fide residency, you can exclude up to $130,000 of foreign-earned income (as of 2025). You’ll need to file Form 2555 to claim it.
- Foreign Tax Credit (FTC) – If you’re paying significant U.K. taxes, you might be better off claiming those payments as a credit on Form 1116, which directly offsets your U.S. tax liability.
Many freelancers in the U.K. opt for the FTC, simply because U.K. tax rates tend to be higher than those in the U.S. But it’s not always cut-and-dry. If your income is relatively low or if your U.K. tax bill is reduced due to expenses or deductions, the FEIE might still be beneficial. Sometimes, running both scenarios side by side is the only way to be certain. Or you bring in a pro.
What About Social Security Contributions?
Here’s where things get a little more technical. Self-employment income can trigger U.S. self-employment tax, which covers Social Security and Medicare, even if you’ve already paid into the U.K.’s National Insurance.
To avoid this overlap, the U.S. and the U.K. have a Totalization Agreement. In general:
- If you’re truly freelancing in the U.K., you usually pay into National Insurance, not U.S. Social Security.
- If you’re temporarily assigned to the U.K. by a U.S. employer, you may remain covered under the U.S. system instead.
To formalize this, you’ll need a Certificate of Coverage from whichever country’s system you’re paying into. This certificate confirms that you’re not required to pay into both. It’s not difficult to obtain, but many freelancers overlook its importance.
U.K. Bank Accounts? The IRS Wants a Peek
If you’ve opened local accounts like a savings account at Barclays or an ISA you barely touch, you may need to report them to the U.S.
- FBAR (FinCEN 114) – Required if the total of all non-U.S. accounts goes over $10,000 at any point during the year.
- FATCA (Form 8938) – Required for individuals with higher total foreign assets (starting at $200,000 for single filers abroad).
These aren’t tax forms. They’re just reporting obligations. But the penalties for ignoring them can be serious, and since U.K. banks report to the IRS under FATCA, it’s risky to pretend they don’t exist.
Freelance Smarter, Not Harder
A few tips to keep your setup clean and penalty-free:
- Track your business expenses and invoices carefully — for both countries.
- Use the IRS’s official exchange rates to convert pounds to dollars.
- Don’t assume you owe nothing — always file, even if you don’t write a check.
- Review your tax plan every year. Things shift — income changes, exchange rates move, visa situations evolve.
And honestly? Unless you really love double-entry bookkeeping and international tax law, it’s probably worth finding a tax preparer who specializes in U.S. expats living in the U.K., like the ones from Expat Tax Online. Not every local accountant will know how to handle both systems, and that matters more than you’d think.
Final Thought
Freelancing from abroad can be wonderfully freeing; you make your own schedule, take on projects that actually interest you, and grab a midday walk through Hyde Park or Holyrood. But with that freedom comes some behind-the-scenes complexity. U.S. taxes don’t disappear, and the U.K. has its own demands.
Still, once you get your system sorted, it becomes manageable. And having that clarity? It’s worth a lot more than the time it takes to get it right.
Disclaimer: This article is for informational purposes only and does not constitute legal or tax advice. Readers are encouraged to consult with qualified professionals for advice tailored to their specific circumstances.
