American wealth in the UK: A three-path playbook for US citizens
American wealth in the UK: A three-path playbook for US citizens who want to work, live, and invest across the Atlantic
WHITE PAPER
Prepared by The Luxury Collective UK and Schroders Wealth Management US
American wealth in the UK: A three-path playbook for US citizens who want to work, live, and invest across the Atlantic
Prepared by The Luxury Collective UK and Schroders Wealth Management US
Introduction
The world has never been more globally connected, and for wealthy Americans the Atlantic feels smaller than ever. Americans are increasingly looking to the UK as somewhere they can build or develop their career, diversify a portfolio or give children an international education. But as Americans become more mobile, understanding the implications of a potential move has become a critical part of responsible wealth planning.
The decision to live, work, or invest abroad is no longer just about lifestyle. It’s about navigating increasingly complex, interlocking tax regimes that shape how income and capital are treated over a lifetime. The abolition of the UK’s long-standing non-domicile regime in April 2025, and the introduction of the new four-year Foreign Income and Gains regime, mark a clear shift toward residence-based rules that reach from annual income through to multigenerational inheritance.
For Americans, this change arrives alongside
a constant: the United States continues to tax worldwide income by citizenship, creating one of the most intricate cross-border intersections in global tax. When US citizenship-based taxation meets UK residence-based taxation, with the US–UK tax treaty as a coordinating framework, both opportunity and risk are amplified. The sequence of moves, the timing of realisations and the architecture of portfolios all begin to matter more than ever.
This white paper from The Luxury Collective UK, in collaboration with Schroders, has been developed to help bridge those two worlds for sophisticated US families. American wealth in the UK aims to explain how to structure assets, plan residency and use or live with the Foreign Income and Gains (FIG) regime while remaining compliant in both systems. Whether a client remains US-based with money managed from London, spends a period of time in the UK or chooses to settle and pursue dual citizenship, the goal is to turn mobility into an informed, durable advantage rather than a source of avoidable complexity.
John Eric
DIRECTOR, THE LUXURY COLLECTIVE UK
John Eric is a Californian by birth, a Washingtonian by choice, and a Londoner at heart. With early roots in publishing and politics—including work on a presidential campaign and within an administration—he brings a diplomat’s discretion and a strategist’s insight to every client relationship. After a successful career in national media, he transitioned into real estate, where for more than two decades he has advised high-profile clients across Washington, DC, and internationally. A founding agent and Executive Vice President at Compass, John is known for white-glove service, confidentiality, and mastery of complex negotiations.
As Director of The Luxury Collective UK, John bridges U.S. and U.K. property markets, guiding global buyers with a distinctly American fiduciary approach. He also publishes John Eric Home & Lifestyle magazine and hosts The Property Diplomat podcast, exploring real estate, politics, and culture. His expertise has been featured in The Washington Post, The New York Times, and The Financial Times. Active in global real estate networks, John speaks regularly at industry events and advises family offices and wealth managers on cross-border investment. Outside of work, he enjoys family time, tennis, travel, good food, and supporting pet adoption.
Anna-Louisa Yon
DIRECTOR, THE LUXURY COLLECTIVE UK
Anna-Louisa Yon is a lifelong Washingtonian whose career bridges entrepreneurship, design, and real estate. She launched a design-focused business during the 2009 downturn, selling to leading galleries and boutiques across the United States and honing her strengths in negotiation and relationshipbuilding. Transitioning into real estate, she quickly emerged as a trusted advisor, earning recognition among the top 1.5% of realtors in the United States by The Wall Street Journal and ranking as the 8th highest individual agent in the DMV region for Compass in 2020. A Capitol Hill resident, she brings deep local insight and a highly connected, client-first approach.
As a Director of The Luxury Collective UK, Anna-Louisa supports clients with international and transatlantic real estate needs. Working with the firm’s London-based team, she guides U.S. buyers through the UK market with cultural fluency and strategic perspective, delivering seamless cross-border representation on both sides of the Atlantic.
Emily Kidd
PORTFOLIO DIRECTOR, SCHRODERS WEALTH MANAGEMENT US
Emily Kidd is a dual-qualified US/UK Portfolio Director at Schroders Wealth Management US, based in London. Drawing on extensive experience in both the UK and US, Emily specialises in advising USconnected families living on both sides of the Atlantic. Her focus is on navigating the complexities of cross-border wealth management, ensuring that her clients can thrive wherever life takes them. Before joining Schroders in 2021, Emily advised business owners with multi-generational wealth at J.P. Morgan’s Private Bank in Chicago. She holds the CISI Private Client Investment Advice & Management qualification (UK) and the FINRA Series 65 (US), and earned her BSc in Psychology from the University of Bristol and MBA from Chicago Booth, University of Chicago.
Ailsa von Dobeneck
MANAGING DIRECTOR, THE LUXURY COLLECTIVE UK
Ailsa von Dobeneck is a dual American-British business professional whose career spans Westminster and Capitol Hill. Beginning in Singapore in communications for a global shipping company, she advanced into U.S. government relations, leading advocacy initiatives, securing infrastructure grants, and managing tax credit programs. Now Managing Director of The Luxury Collective, she draws on her cross-cultural expertise to guide clients through U.S. and U.K. property decisions. Ailsa holds degrees in International Affairs and German from the University of Georgia and a master’s in International Relations from King’s College London, and she’s also a passionate historic cook with a published recipe series in The Daily Beast and several television appearances.
Introduction: The US–UK tax spine in 2025: citizenship, residence, and FIG
Wherever they choose to live, American citizens living overseas are broadly subject to the same tax regime as would apply if they were still in the US. This is because US tax law differs from that of virtually all other developed countries around the world, in that it is based on citizenship rather than on residency. In other words, if you’re an American citizen living in the UK, you will need to file a US tax return each year and are potentially liable for US taxes.
By contrast, the UK taxation system is based on residency. As of 6th April 2025, the previous “non-dom” regime was abolished in favor of a residency-based system. Now, individuals who are in their first four years of residency, and who have not been UK resident for the ten tax years before they arrive, can secure tax relief for foreign income and gains that arise during the period. This fouryear period can present some attractive planning opportunities for American families looking to establish residency in the UK.
With such different tax regimes, and even different tax years (the UK tax year runs begins on 6th April versus the US tax year starting on 1st January), managing tax in both jurisdictions is clearly complicated.There is a US/UK income tax treaty, which is designed to ensure that individuals are not taxed twice on the same income. However, careful planning is still required to navigate the differing tax regimes.
Turning from income to inheritance tax, the two systems also differ significantly. In the US, individuals have the benefit of the lifetime gift and estate tax exclusion, of $13.99 million per individual in 2025, and double this level for a married couple. By contrast, in the UK the standard inheritance tax rate is 40% on the value of an estate that exceeds the tax-free “Nil-Rate Band” threshold of £325,000, which has been frozen at this level until April 2031. There is an additional tax-free threshold, the Residence NilRate Band , of up to £175,000 available if you leave
your main home (or the value from its sale) to a “direct descendant.” This increases an individual’s total tax-free allowance to £500,000,although the Residence Nil-Rate Band allowance tapers down for estates that exceed £2 million. Clearly, this is of a very different magnitude to the US lifetime allowance. Many wealthy UK individuals therefore take advantage of lifetime gifts, which are deemed “Potentially Exempt Transfers”. These can be of unlimited value and become fully exempt from Inheritance Tax if the donor survives for seven years after making the gift. This is a key part of UK estate planning, allowing individuals to reduce the value of their taxable estate.
For American families looking to settle in the UK for the long term, they have a much longer period of time under the new UK rules to consider their estate planning. Under the new regime, individuals have ten years before their non-UK
assets become subject to UK Inheritance Tax. Once an individual has been resident in the UK for ten out of twenty years, they will be subject to inheritance tax (IHT) on their worldwide assets. Such individuals remain liable for UK IHT for up to ten years after leaving the UK, although the length of the “tail” is determined by how long they were UK resident. For those who were previously nondomiciled, the new FIG rules are an extension to the time they remain in scope for IHT after their departure.
The UK’s new FIG regime presents some attractive wealth planning opportunities, particularly in the first four years of UK residency, for income and capital gains, and the first ten years for estate planning. One key success factor is to seek advice from dual qualified US/UK advisors, as it is critical that any strategies work together across both the US and UK regimes.
Path One – The offshore portfolio: US resident, UK-managed money
In the last year or so, Schroders has seen a significant increase in the number of high-networth American families who have no plans to leave the US, who are choosing to appoint investment managers outside of the US to hold and manage a portion of their wealth. The motivations for choosing to establish an asset base offshore vary significantly, and often there’s a combination of both personal and financial goals at play that can broadly be described in two categories:
INVESTMENT AND CURRENCY RISK
Many US financial institutions adopt a “home bias”, with exposure to US assets that goes beyond their already large share of global markets. Some individuals want their asset base to better reflect global markets, currently around 64% US and 36% global (based on the MSCI All Countries World Index as of 31 December 2025).
Given the strength of US markets in recent years, and their concentration in a small number of technology stocks, some investors are interested in allocating more to overseas markets. The top 10 stocks in the US accounted for 39% of the S&P500 index at the end of 2025, based on data from S&P Global.
For some investors, currency is the major driving factor, particularly for those with assets or liabilities in multiple currencies who may be concerned about the outlook for the US dollar. In 2025, the USD fell by 9% against other major world currencies - its biggest annual drop since 2017. Trump’s “Liberation Day” tariffs saw some international investors reassess their willingness to hold US assets on an unhedged basis.1 Conflict between the White House and the Federal Reserve is also a concern and may act as a USD headwind over the medium term, alongside US debt and deficits.
[1] Source: LSEG Datastream. 2025 performance is based on the ICE US Dollar Index, which tracks the USD’s performance against the currencies of major trading partners.
Schroders helps US resident clients diversify their investment and currency exposure through tailored strategies that reflect the overall composition of their asset base. This could mean mirroring global markets or managing portfolios focused on non-US assets, often comprising European stocks denominated in sterling or euros.
JURISDICTIONAL RISK
Leaving aside investment considerations, some clients want to diversify where their wealth is held, for a range of different reasons. They may believe that rising political and cultural divisions mean keeping all their assets in one jurisdiction carries unnecessary risk. Others have broader economic concerns, whether that’s a return in the US to very high levels of inflation or some form of capital controls. While there are no current proposals to restrict the movement of capital in or out of the US, economic theory suggests that it could play a role in reducing the US trade deficit – as senior members of the Trump administration have acknowledged. Whatever the exact nature of their concern, a growing number of Americans view holding offshore assets as a prudent step, and London is often deemed the preferred safe haven jurisdiction in which to appoint investment managers outside of the US.
MANAGING WEALTH IN THE UK: INVESTMENT AND TAX CONSIDERATIONS
For US residents considering holding investment assets offshore, it is absolutely vital to appoint a specialist investment manager who understands US taxpayer requirements.
US residents face some investment restrictions when investing in the UK. ‘Passive Foreign Investment Companies’ (PFICs) are one key area to watch out for. This category includes many pooled investments – such as mutual funds, hedge funds, and investment companies – that are registered outside of the US. The tax treatment of PFICs is extremely punitive compared to that of similar investment vehicles that are incorporated in the US. There are also burdensome reporting rules to take into account. In addition to ensuring that the investments are appropriate from a tax perspective, US tax reporting is equally important. It is vital that
American families work with investment managers who can provide them with calendar year tax reporting, including short-term and long-term gains, using US methods of cost basis reporting. Form 1099 and Foreign Bank Account Reports (FBARs) also need to be provided.
FBARs may be a new concept for Americans who have never invested outside of the US.Alongside a tax return, FBARs are one of the most important regular reporting requirements faced by Americans living overseas, with severe penalties for those who fail to comply. FBARs originated in the Bank Secrecy Act of 1970, which targeted money laundering and other financial crimes. Today, Americans are required to file an FBAR – effectively reporting the value of overseas accounts - if the total value of their overseas bank accounts is more than $10,000 on any day in the tax year, even if it’s split between two or more accounts.
It is worth noting that following the introduction of the Foreign Account Tax Compliance Act (FATCA) in 2010, in our experience, many non-US financial institutions actually refuse to take on American clients. Under FATCA, they are required to report the assets and identities of US account holders, which many deem too costly or risky to implement.
Importantly, when appointing a non-US investment manager, US investors should look for SEC-licenced firms. Without an SEC licence, a client’s UK investment manager may not be able to speak with or advise clients on US soil. An SEC license is additionally a very good first indicator that the firm has the necessary expertise to look after American resident clients.
Path Two – The temporary mover: benefiting from the FIG window
Over the last few years, we’ve worked with many Americans who have moved to the UK without the intention to remain permanently. We see this occur at all stages of life: successful professionals who want to develop their career by working overseas, young families with one set of grandparents in the UK as well as retirees who want to spend more time with UK-based family. Whatever their circumstances, these temporary residents will need to make sure that any investments they make while resident in the UK are suitable from a US tax perspective. They will also be subject to UK and US tax (subject to the US-UK tax treaty) on income generated in the UK.
Temporary residence also comes with a unique advantage: the UK’s new four-year grace period on foreign income and gains, introduced in April 2025. During this window, new arrivals will not be taxed on income or gains relating
to assets held in the US - or elsewhere. After this period, they will be subject to UK tax on worldwide assets in the same way as long-term UK residents.
For those Americans coming to the UK on a temporary basis, this new regime is more attractive than the former “non-domicile” system that international families in the UK have had to navigate for many years.
However, it does create a four-year cliff edge, at which point worldwide income and assets become subject to UK tax. Careful planning is required in advance of this point. It is important to take advice on any structures and investments that may not be suitable after this point and potentially restructured or exited.
Press reports from mid-2025 suggest that the government has explored the possibility of a new investor visa program. If pursued, this could open
further opportunities for those considering a period of temporary residence in the UK. We will be closely monitoring any developments.
We know that some individuals who move from the US to the UK end up moving to other parts of the world after spending time in the UK. For this reason it is worth considering holding assets in an offshore jurisdiction. For example, Schroders are able to provide continued support to clients who leave the UK by holding assets in the Channel Islands and continuing to provide investment and reporting that meet ongoing US requirements.
Path Three – Long-term residence and citizenship in the UK: key considerations
Many Americans coming to the UK have a clear intention to stay for longer. They may become long-term residents or even citizens: a record number of Americans applied for UK citizenship in 2025, according to the UK’s Home Office.
Individuals thinking of long-term relocation to the UK need to plan for the temporary nature of the FIG regime. As a reminder, after the four-year window global income and gains will be subject to UK tax (as well as US tax, assuming they don’t renounce their green card or US citizenship).
For this reason, Americans settling in the UK for the long term often appoint a UK-based investment manager with specialist US expertise early in the process of moving. This approach has significant advantages, allowing for proactive planning on how to navigate US and UK tax regimes.
A specialist US/UK investment manager with experience of both tax regimes can also make sure that investments are suitable from a UK tax perspective. In many cases, the starting point will be identifying US-based investments that are not suitable for long-term UK residents. Clients could put in place a plan to gradually realize gains over the four years of the FIG window. The specialist manager will also be to ensure that any new investments are suitable from a UK perspective, making it easier to transition into the UK tax regime after four years of residency.
Structuring your wealth: considerations for Americans looking invest, work or live in the UK
ISSUE WHAT’S INVOLVED?
Structuring
Reporting
It’s unlikely that you’ll move all of your assets out of the US: structures such as IRAs and 529s need to remain in the US to retain their tax status.
WHAT SHOULD CLIENTS DO?
Most American clients opt to move assets held in their own name or in the name of their revocable trust.
Seek advice to ensure that any proposed UK structures are appropriate from a US perspective (many are not).
Investment universe
A US tax pack, Foreign Bank Account Report (FBAR) and 1099s. And UK tax reporting as required.
Making sure that individual investments are appropriate from both a UK and US tax perspective
US tax reporting is essential for Americans mov-ing (or moving assets) to the UK. As well as providing US reporting, a manager must also be mindful of US tax consequences, such as realizing short and long-term capital gains.
American clients in the UK should generally use US domiciled funds (such as ETFs and mutual funds) or direct investments (individual equities and bonds). Clients considering long-term UK residency should ensure that selected funds have “UK reporting status.”
Non-US funds should be avoided, as many are deemed “Passive Foreign Investment Companies” and attract higher tax. Many popular investments in the UK are unsuitable for American clients.
Wills and inheritance
How will assets held abroad fit within your estate plan-ning?
Individuals investing outside of the US should take legal advice in the jurisdiction where assets are custodied. In most cases, clients require a simple will in this jurisdiction, referring back to their main US will.
Considering a move? Here are the key questions for a potential UK wealth manager
• Who is your typical client? What range of services do you offer? How are you positioned to fulfil my specific needs?
• What expertise do you have in looking after American clients? Do you have an SEC license?
• How does your investment process factor in US requirements, such as ‘no PFICs’?
• For those newer UK residents eligible for FIG, can you exclude UK assets to ensure the holdings remain eligible for UK tax relief under FIG?
• Can you provide domicile and residence advice to clients coming to, living in, or leaving the UK?
• What US tax reporting do you offer (Tax packs, Foreign Bank Account Reports, 1099s)? Can you offer UK tax reporting should I need it?
• How will you coordinate with my other advisors e.g. reporting, meetings, etc.?
Conclusion
The transatlantic financial corridor is entering a new phase. For Americans engaging with the UK after 2025, the rules are clearer in some respects but also tighter and more closely enforced.
The end of the traditional non-dom regime and the arrival of FIG signal an environment in which foresight, documentary discipline, and joinedup advice are rewarded, while improvisation and fragmented decision-making can be costly.
The message of this white paper is certainly not that the UK has become hostile to American wealth, but that it has changed - and the changes create opportunity for those who plan ahead and align decisions with treaty principles. Combining US and UK taxation, reporting, and inheritance frameworks demands technical fluency, but it also calls for a practical understanding of families’ ambitions, time horizons, and tolerance for
complexity. In this context, collaboration between specialist investment managers, cross-border tax professionals, and legal advisers is essential rather than optional.
For globally minded Americans, the UK remains a strategic gateway: a financial centre with deep capital markets, a legal system that is widely trusted, and an education and lifestyle proposition that continues to resonate.
With an appropriate approach, US families can ensure that where they live and where their wealth is held complement rather than conflict with each other. Post 2025, the UK is neither a simple tax haven nor an automatic tax trap for Americans; it is an opportunity set that rewards early, treaty-aware planning across paths, life stages, and generations.
This article is issued by Schroder Wealth Management (US) Limited, a firm authorised and regulated by the Financial Conduct Authority and registered as an investment adviser with the US Securities and Exchange Commission. Registered office at 1 London Wall Place, London EC2Y 5AU. Registered number 10761882 England. Nothing in this document should be deemed to constitute the provision of financial, investment or other professional advice in any way. Past performance is not a guide to future performance. The value of an investment and the income from it may go down as well as up and investors may not get back the amount originally invested. Exchange rate changes may cause the value of any overseas investments to rise or fall. Statements concerning taxation are based on our understanding of the taxation law in force at the time of publication. The levels and bases of, and reliefs from, taxation may change. You should obtain professional advice on taxation where appropriate before proceeding with any investment. For your security, communications may be recorded and monitored.
