Helen Burggraf | TaxConnections

02 Aug 2019

Canadian Court Is Latest To Reject FATCA Legal Challenge

A Federal Court in Ottawa on Monday dismissed the latest legal effort by two dual Canadian/U.S. citizens to block Canada’s implementation of the U.S.’s Foreign Account Tax Compliance Act, dealing a blow to thousands of Americans with dual citizenship and consequent tax obligations not just in Canada but, supporters of the plaintiffs argue, around the world.

Monday’s ruling, by Federal Court of Canada Justice Anne Mactavish, was the latest in a series of court setbacks for opponents of FATCA since the tax-information-gathering law came into force around the world in 2014, and comes some six months after a five-day trial in the matter, which took place in Vancouver in late January and early February.

The ruling also comes just three days after a French court decided in favor of allowing France’s FATCA implementation regime to stand. As reported , that decision sparked a social media storm on the part of Americans with dual nationality in France as well as abroad.

Written by Helen Burggraf | Posted in Canada

25 Jul 2019

Seven Things That Surprise Americans About U.K. Mortgages, House-Buying

One of the most memorable moments of their U.K. house-buying experience, for many American expats, is when someone explains to them what the word “gazumping” means.

“Gazumping,” a word which doesn’t exist on the other side of the pond, refers to when the seller of a UK property unexpectedly accepts another, higher offer, typically just as contracts are about to be exchanged.

The term came into widespread use in the UK over the last two decades of the last century, when house prices in London were rising steadily, at times quite fast.

A related word, and one that also isn’t found in an American English dictionary, is “gazunder”, which is when a buyer reduces the amount that they are willing to pay for a property.

Written by Helen Burggraf | Posted in Americans Abroad • Real Estate • U.K. Home Buying

23 Jul 2019

Get Professional Advice To Avoid Risk Of ‘A Boris’: U.S. Expatriates In U.K. Warned

Boris Johnson, the front-runner to succeed Theresa May as Britain’s prime minister this week, is well known to Londoners for myriad reasons, including having unofficially lent his name to a bicycle-sharing scheme (“Boris bikes”) that was launched in 2010, and with which he, a keen cyclist himself, was associated.

Less well known to many of his fellow Londoners is that he had a bitter and rather public battle with the U.S. IRS six years ago, when it sought to tax him on the sale of his London property, owing to the fact of his American citizenship, acquired at birth.

Below is an updated version of a story on his U.S. tax travails that we first ran last September. We thought it timely to revisit this issue now, because London property experts report that Americans currently account for a disproportionately large share of those currently shopping for – and buying – London properties, helped by a dollar that’s at near-record highs against the pound, and expected to strengthen further. At the same time, London property prices have been under pressure, with the average value of a London home reported recently to be down by 4.4% in the year to the end of May.

When British politician Boris Johnson renounced his citizenship in 2016, many observers speculated that he had finally been moved to do it after the seemingly ill-advised sale of his home in north London in 2009 saw him hit with a significant (said to be in the tens of thousands of pounds) capital gains tax payable to the U.S. government on his half of the profit from the sale.

Written by Helen Burggraf | Posted in Expatriate Taxes

22 Jul 2019

Accidentel Americans Reel But Vow To Fight On As France’s Conseil d’Etat Rules In Support Of Current FATCA Regime

So-called “Accidental Americans” in France and elsewhere in Europe expressed disappointment, and in some cases dismay, after France’s top administrative court ruled that the current regime under which France provides information to the U.S. under its controversial Foreign Account Tax Compliance Act could stand, and didn’t need changing or to be scrapped.

In its decision, published yesterday, the Conseil d’Etat said it saw no legal basis to support claims by the Paris-based Accidental Americans Association that the way France currently implements FATCA violated the privacy of dual French/American citizens.

It also rejected arguments that the reporting regime is one-sided – that is, that it doesn’t oblige the U.S. to provide the same amount of information about French citizens living in the U.S., and thus the information flow is one-sided – according to French news reports.

“The [Conseil d’Etat] ruled that the claims by the accidental Americans, that the regulations under which FATCA is enforced in France, lack legal legitimacy, are unfounded,” the French news agency, AFP reported.

It added that the decision was in line with statements made at a hearing on the matter earlier this month by the public rapporteur that the problems having to do with FATCA at most had to do with “technical difficulties of implementation.”

Written by Helen Burggraf | Posted in Accidental Americans

17 Jul 2019

Citi Closes Small Portion Of United States Credit Card Accounts In Certain Countries On July 17, 2019

New York-based multi-national Citibank has confirmed that it has informed a “small portion of U.S. credit card-holders with mailing addresses in certain international countries” that it will no longer be able to service their accounts, citing “local regulatory requirements”.

News of the card account closures came in response to a query on behalf of a card-holder currently resident in the U.K., who first obtained a Citibank “AAdvantage Gold MasterCard” some years ago, and who received a “notice of pending account closure” earlier this month.

A spokesperson for Citibank – or Citi, as it is now normally referred to as – wasn’t able to say how many other countries besides the U.K. were included in this account closure.

The spokesperson added that those U.S. credit card holders residing in the U.K. and other countries where the bank is discontinuing providing credit card services would be able to keep their accounts if they were able to provide the bank with “a U.S. mailing address within 90 days” of receiving the letter saying their account was to be closed.

Written by Helen Burggraf | Posted in Bank Accounts • TaxConnections

16 Jul 2019

IRS Formally Announces It Will No Longer Challenge Foreign Tax Credits On Two French Social Services Contributions

The U.S. Internal Revenue Service said on Wednesday that it “will not challenge” the claiming of foreign tax credits against certain controversial payments that potentially thousands of American expatriates resident in France have been paying for years, and noted that taxpayers who wish to file a claim for refund of U.S. tax with respect to a foreign tax credit have 10 years after the “due date for filing the return” in question in which to do so.

The IRS statment, which was only two paragraphs long, came less than two weeks after the tax authority admitted in a U.S. Tax Court that it had wrongly collected millions of dollars of tax from France-resident American citizens in connection with their payment of the French “Contribution Sociale Generalisee” (CSG) and “Contribution au Remboursement de la Dette Sociate” (CRDS) taxes.

As reported, that statement was seen as capping a years-long legal saga, and was expected to potentially launch millions of dollars worth of tax refund claims by U.S. expats who have lived in, and been filing tax returns from, France.

Written by Helen Burggraf | Posted in IRS • TaxConnections

12 Jul 2019

OECD Efforts To Harmonize Value Added Tax Rules

Businesses that sell goods and services across international borders may soon face major changes, as recently-unveiled plans by the Organisation for Economic Co-operation and Development to harmonize the way online commerce is taxed by governments around the world appear set to become law within a few years.

Recently, the G20 ministers meeting in Japan endorsed an overhaul of the global corporate tax regime that was presented there by the OECD. Published reports immediately after the event quoted experts as saying the proposed corporate tax “roadmap” would represent “the most significant” such package of tax changes “in over a century.”

This “Programme of Work to Develop a Consensus Solution to the Tax Challenges Arising from the Digitalisation of the Economy,” as it is officially called, is being considered as a means of addressing at a global level the way corporations are taxed, in an era that is seeing financial transactions increasingly taking place online and carried out over blockchain networks.

Written by Helen Burggraf | Posted in OECD • VAT

11 Jul 2019

American Couple In France In Major Win Against IRS Over Tax

In a development that is being seen by American expat groups in France as a major win, the U.S. Internal Revenue Service has admitted in a U.S. Tax Court that it had wrongly collected millions of dollars of tax from France-resident American citizens, ending a years-long legal saga that could see millions of dollars paid to U.S. expats who have lived in and been filing tax returns from France, in the form of refunds.

The matter, which is seen as changing an element of the way Americans resident in France are taxed by the U.S., could lead to thousands of the estimated 100,000 American citizens currently living in France claiming back up to US$100m from the U.S. government, according to London-based U.S. tax attorney Stuart Horwich of Horwich Law.

Horwich assisted Ory and Linda Eshel, the two France-resident U.S. taxpayers who mounted the legal case in question, in bringing their claim to court.

At issue is a court statement by the IRS, in a Washington, DC court, that it had finally accepted that U.S. citizens resident in France could deduct against their U.S. taxes certain previously disallowed taxes paid to France.

Written by Helen Burggraf | Posted in Expatriate Taxes • France

10 Jul 2019

U.S. Embassy In Austria Enlists McDonald’s To Help It Reach American Citizens ‘In Distress’

At a time when cash-strapped governments around the world are struggling to keep overseas embassies and consulates operating, the deal is seen as likely to inspire other similar institutions to seek similar arrangements.

A spokesman for McDonald’s Austria, Wilhelm Baldia, told The New York Times last week that he was not aware of any other country with such an arrangement.

The U.S. Embassy in Vienna declined to talk to the American Expat Financial News Journal, referring us to a State Department spokesperson in Washington, who said only that “as part of our commitment to assisting U.S. citizens in need overseas, from time to time we work with private-sector and other non-government entities.”

Under the arrangement, Americans who have been travelling in Austria and who, for example, lose their passport or their mobile phone will now be able to enter any of the 194 McDonald’s restaurants in Austria, and receive an emergency, round-the-clock U.S. Embassy telephone number. If they need a phone to make the call, McDonald’s will provide them with the use of one.

Written by Helen Burggraf | Posted in American Expat Financial News