One minute with David Treitel, director at American Tax Returns Ltd.
You help Americans and their advisers on the interaction of US and UK tax issues. How have recent events affected your advice?
Rejoice! The pound has fallen! This event creates unexpected planning opportunities for Americans with UK assets to make capital gains today, but to end up owing very little or no tax in the States because gains calculated in US dollars today will be far lower than at any other moment in recent years. Responding to exchange rate movements, as well as April’s upcoming changes to the non-dom rules, means that the months ahead will be especially busy for anyone advising Americans in the UK.
How could the IRS learn from HMRC?
The funeral is not booked, the body is not yet even dead, but HMRC is busily predicting the death of the UK personal tax return. One should compare abolishing just 10.2m UK self-assessment personal tax returns to the volume of over 150m individual US tax returns currently filed annually in the States. It would seem sensible for the IRS to save money (and stress for taxpayers) by reducing the volume of tax returns in the States. Sadly, no such plans exist, but most Americans overseas would be delighted if the IRS would copy HMRC’s policy of requiring tax returns only for more complex taxpayers; and remove the annual chore of filing tax returns where there is no additional tax payable.
Rumours are that the IRS has experienced huge amounts of tax fraud. Does this also affect people who are not American?
The IRS has said that during 2015 over 724,000 people had their online accounts accessed by criminals. To reduce theft, the IRS has just launched a rolling renewal process for ITINs (Individual Taxpayer Identification Numbers). ITINs are issued to non-Americans who own a US rental property in the States, receive a pension from America or are partners or business owners in the States. With over 11 million ITINs set to be deactivated on 31 December 2015, early renewal to beat the rush is vital. Unfortunately, as part of their enthusiasm for avoiding fraud, the IRS rejects over 30% of all applications for ITINs! Consequently, the only guaranteed way of getting an ITIN is using an IRS certified acceptance agent. This is something I became back in the year 2000, when I was the very first here in the UK able to meet all of the tough IRS security checks.
How you expect tax policy to change as a result of the US election?
The US has one of the highest corporate tax rates in the world. If America is to remain competitive, this seems certain to change, no matter who is in charge. Other policies are less clear. Trump’s overarching tax policies follow the legacies of Presidents Reagan and Bush, by proposing to stimulate the economy through significant tax cuts. Clinton’s tax plan increases tax for wealthier folks but supposedly leaves the middle classes paying no more than today.
Aside from your immediate colleagues, who in tax do you most admire?
Trevor Collins, who died tragically from bowel cancer in 2008, interviewed me when I started on the road of American tax back on joining EY in 1988 (well, more exactly, it was called Arthur Young back then). He said during that interview that working in US tax would make me a very valuable person indeed. Whether I believe him yet remains open to question; but Trevor was an inspiration to colleagues during his life. A charity in his name, The Trevor Collins Foundation, is actively raising funds to help with early detection of bowel cancer, so that others can survive longer than Trevor.
Finally, you might not know this about me but …
When I set up my own firm, I knew that it had to be diverse and aim to employ people who did not fit the stereotype of the boring accountant. My own parents both arrived in the UK as child refugees from Hitler’s Germany, so helping others who need a hand, just as my own family were rescued by strangers, was always top on my agenda – way ahead of my passion for tax.
One minute with David Treitel, director at American Tax Returns Ltd.
You help Americans and their advisers on the interaction of US and UK tax issues. How have recent events affected your advice?
Rejoice! The pound has fallen! This event creates unexpected planning opportunities for Americans with UK assets to make capital gains today, but to end up owing very little or no tax in the States because gains calculated in US dollars today will be far lower than at any other moment in recent years. Responding to exchange rate movements, as well as April’s upcoming changes to the non-dom rules, means that the months ahead will be especially busy for anyone advising Americans in the UK.
How could the IRS learn from HMRC?
The funeral is not booked, the body is not yet even dead, but HMRC is busily predicting the death of the UK personal tax return. One should compare abolishing just 10.2m UK self-assessment personal tax returns to the volume of over 150m individual US tax returns currently filed annually in the States. It would seem sensible for the IRS to save money (and stress for taxpayers) by reducing the volume of tax returns in the States. Sadly, no such plans exist, but most Americans overseas would be delighted if the IRS would copy HMRC’s policy of requiring tax returns only for more complex taxpayers; and remove the annual chore of filing tax returns where there is no additional tax payable.
Rumours are that the IRS has experienced huge amounts of tax fraud. Does this also affect people who are not American?
The IRS has said that during 2015 over 724,000 people had their online accounts accessed by criminals. To reduce theft, the IRS has just launched a rolling renewal process for ITINs (Individual Taxpayer Identification Numbers). ITINs are issued to non-Americans who own a US rental property in the States, receive a pension from America or are partners or business owners in the States. With over 11 million ITINs set to be deactivated on 31 December 2015, early renewal to beat the rush is vital. Unfortunately, as part of their enthusiasm for avoiding fraud, the IRS rejects over 30% of all applications for ITINs! Consequently, the only guaranteed way of getting an ITIN is using an IRS certified acceptance agent. This is something I became back in the year 2000, when I was the very first here in the UK able to meet all of the tough IRS security checks.
How you expect tax policy to change as a result of the US election?
The US has one of the highest corporate tax rates in the world. If America is to remain competitive, this seems certain to change, no matter who is in charge. Other policies are less clear. Trump’s overarching tax policies follow the legacies of Presidents Reagan and Bush, by proposing to stimulate the economy through significant tax cuts. Clinton’s tax plan increases tax for wealthier folks but supposedly leaves the middle classes paying no more than today.
Aside from your immediate colleagues, who in tax do you most admire?
Trevor Collins, who died tragically from bowel cancer in 2008, interviewed me when I started on the road of American tax back on joining EY in 1988 (well, more exactly, it was called Arthur Young back then). He said during that interview that working in US tax would make me a very valuable person indeed. Whether I believe him yet remains open to question; but Trevor was an inspiration to colleagues during his life. A charity in his name, The Trevor Collins Foundation, is actively raising funds to help with early detection of bowel cancer, so that others can survive longer than Trevor.
Finally, you might not know this about me but …
When I set up my own firm, I knew that it had to be diverse and aim to employ people who did not fit the stereotype of the boring accountant. My own parents both arrived in the UK as child refugees from Hitler’s Germany, so helping others who need a hand, just as my own family were rescued by strangers, was always top on my agenda – way ahead of my passion for tax.
