Self-employed across borders, without paying into two systems.
Freelance income crosses borders easily; the social security systems attached to it do not. Without the right certificate you can owe US self-employment tax and UK National Insurance on the same pound.
One income, two social security claims
The US-UK totalization agreement decides which country's system you pay into — but it only protects you with a certificate of coverage in hand. Meanwhile the income itself is reported on both returns, with credits flowing under the ordinary treaty rules.
- Certificates of coverage under the totalization agreement
- Schedule C and UK self-employment pages, aligned
- Estimated taxes and payments on account, both sides
- VAT and sales tax registration questions
The company question, answered with numbers
A UK limited company is often tax-efficient for a British contractor — and a CFC filing burden for an American one. Whether to incorporate, and where, depends on your citizenship and residence path. We run the numbers before you form anything.
What we typically handle for you
- Certificates of coverage under totalization
- Schedule C and UK self-employment pages, aligned
- Estimated taxes and payments on account
- Entity analysis: sole trader vs limited company
- VAT and sales tax registration questions
- Home-office and expense treatment both sides
- IR35 interaction for UK engagements
- Multi-client, multi-country income sourcing
The services that usually apply
Questions we get about this
It is often efficient in the UK, but a UK company owned by a US person brings controlled foreign company reporting and potentially GILTI.
That does not make it wrong, but the US cost has to be weighed rather than discovered later.
Commercially it is straightforward. The tax questions are where the work is performed, whether you have created a taxable presence, and any withholding at source.
Where you sit when you do the work usually matters more than where the client is.
Days worked in each country, where the work was performed, and invoices tied to those periods.
Both residence tests and any apportionment depend on exactly this, and it is trivial to keep and painful to rebuild.
Usually not. The US-UK totalisation agreement is designed to stop double social security, assigning you to one system.
A certificate of coverage is what actually evidences it, and it needs obtaining rather than assuming.
Often, but the definitions differ, and the UK also has its own employment status rules for engagements through a company.
Being treated one way in the UK does not settle how the IRS sees the same work.
It can apply to the earnings, but it does not remove US self-employment tax, which catches people out.
Where the totalisation agreement assigns you to the UK system, that is usually the cleaner answer.
Related pages
- Who we help
Landlords & property owners
Rental property across the US and UK: dual reporting, depreciation differences, non-resident schemes and currency gains on sale.
- Pillar guide
Tax specialists for US and UK
What US and UK tax specialists handle that a general accountant does not: residence tests, treaty relief, FBAR, PFICs, pensions, property and catch-up filings.
- Service
Business & corporate tax
Cross-border business structuring: UK limited companies under US rules, GILTI, permanent establishment and expansion in either direction.
- Free tool
Foreign Earned Income Exclusion
See what the Foreign Earned Income Exclusion covers for your tax year, which qualification test you meet, and when foreign tax credits beat it in the UK.
- Who we help
Retirees & pensioners
Retiring across the Atlantic: pensions drawn cross-border, Social Security, state pension and lump sums under the treaty.
- Service
Property & capital gains
Cross-border property and capital gains: selling a home, rental income, currency gains and the 60-day UK reporting deadline, handled on both returns.
Further reading
- The totalization agreement: which country gets your social security
Income tax treaties do nothing for social security. A separate agreement handles it - and it decides whether you pay National Insurance or US payroll taxes.
- Self-employment tax: the 15.3% the exclusion does not touch
The foreign earned income exclusion wipes out the income tax and leaves self-employment tax standing. For an American freelancing in Britain, the answer is a certificate of coverage.
- National Insurance for Americans working in Britain
It looks like a second income tax, yet it builds a State Pension record and interacts with US social security. Here is how it works for newcomers.
Last reviewed . Thresholds and rates change annually — check figures against the current tax year before relying on them.
Contracting across the Atlantic?
We will confirm which system you pay into and what your structure actually costs on both sides.