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Living in USA - paying maintenance in UK: tax?

  • NYLondoner
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20 Oct 12 #361956 by NYLondoner
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I''m due to start paying maintenance to my wife in the UK once we are divorced but wanted to understand whether she would be taxed on the payments in the UK. The tax treaty suggests they would be taxable, and I get alimony as a deductible in the US. However, on the HMRC site, it suggests that maintenance is not a taxable form of income. Can anyone help with this please as it will help to determine what the payment will be. Thanks

  • dukey
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20 Oct 12 #361959 by dukey
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Spousal (alimony) and child maintenance are not taxable in the UK.

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20 Oct 12 #361960 by NYLondoner
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Thanks for this. Do you know whether I should then be witholding tax in the US - or if the US will be expecting my ex to pay them the tax?

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20 Oct 12 #361962 by dukey
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Sorry but i know nothing of the US tax structure, the only person who may be able to answer is little mr mike, sadly his wife passed this week so i doubt he will be posting.

Over here we pay tax at source so any maintenance paid is less tax to start with.

Think of it this way, i agree to pay spousal maintenance at £25 per week, i earn £100 per week, but after tax i have £75 per week so after maintenance i have £50 left, so the £25 maintenance is already tax deducted.

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20 Oct 12 #361966 by NYLondoner
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Yes, it''s a little more convoluted over here whereby alimony is tax deductible and it''s the responsibility of the payee to pay the tax. I still need to understand whether this is done on an annual or monthly basis... This seems to change slightly if the payer and payee are in different countries but I can''t believe that there would be no tax to be paid whatsoever. If, as it sounds, the UK will not be chasing down my ex wife, I''m sure the US will still have an interest. Sorry to hear about Mr Mike

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20 Oct 12 #361968 by dukey
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From what little i know if there is any tax to pay you will pay it at your end, all i do know is your ex wont pay any tax on what you give her over here.

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07 Jun 13 #396224 by div13
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Hi. I am wondering if you resolved this. I am in the same sitution but in reverse. I will be receiving maintenance form my ex in the UK and he will be living and earning in the US. I am trying to figure the tax issue out

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