March 4, 2013
We are well aware of the infamous French dramatics as the wealthy flee the country over the changing tax structure but few know that Americans renouncing citizenship has tripled in the last few years. As The Telegraph reports, many decide to give up citizenship after tiring of the lengthy US tax return process. Since US tax laws changed in 2008 (all American citizens are required to file a tax return on their world-wide income – even if they have not visited the US for decades), the number of ‘renunciations’ has risen from 231 per year to 1,781. The process of immigration can be costly (due to the actual tax and legal preparation) but “actually giving up your citizenship is dead easy – once you have an appointment with a consular official, it takes a matter of minutes.” One London-based lawyer (where it appears a lot of Americans are immigrating – the 2011 census found 177,185 people living in England and Wales were born in the US) adds that the “US Embassy in London has responded to that demand by streamlining the process.”
London-based American lawyers, who specialize in tax and immigration, report a threefold increase over the last five years in the number of American citizens who are giving up their citizenship – a process known as “renunciation”.
Across the world 1,781 Americans renounced their citizenship in 2011 compared with just 231 in 2008, when US tax laws changed, although it remains unknown how many are adopting British rather than any other nationality.
Many decide to give up their American citizenship after tiring of the lengthy US tax return process, which requires them to pay tax on their total income regardless of where they live.
“There’s no question that the number of people renouncing their US citizenship is increasing,” said Diane Gelon, a US tax and immigration lawyer based in London.
This article was posted: Monday, March 4, 2013 at 6:19 am