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Suppose an American expat taxpayer living in the United Kingdom earns dividends on U.S. stocks that fall below the UK's tax-free dividend allowance of £2,000, and this is the only income they have from outside the UK. Assume that they do not have capital gains, or any other circumstances that would cause them to have to file Self Assessment.

It seems that such an individual does NOT have to file Self Assessment.

But does the situation change if the taxpayer has to pay some nonzero amount of U.S. tax on these dividends? (I have read that generally speaking, if a person is a UK tax resident and needs to pay tax on income from outside the UK, then they have to file Self Assessment, but I'm unclear on whether that applies to this specific edge case.)

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    I don't know the answer for US dividends (you wouldn't need to tell them for UK ones)... I'd suggest using either webchat or phoning HMRC to ask. If there IS a need to report these dividends, doing so in the chat/call may be sufficient. These days, many things can be reported that way without the need for a full self-assessment.
    – TripeHound
    Oct 3, 2020 at 12:21

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You don't need to file a UK return in that case. Keep in mind also that there is a double tax agreement with the UK and USA, so in the future if you are paying tax in one juristiction then you are likely to be able to offset that against what is due in the other.

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  • Thank you for adding your input but it would be best if you can provide references for such statements so that people can consult the text that is a basis for your claim. Thanks. Jul 16, 2023 at 20:26

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