London Mayor Boris Johnson has decided to settle an outstanding US capital gains tax bill ahead of his visit to Boston, New York and Washington next month, according to the FT. The news comes despite him previously declaring he would not pay the ‘absolutely outrageous’ demand from the IRS, which was levied on the sale of his home in North London. Johnson holds dual US and UK citizenship, and one of the legal obligations of holding a US passport is that the passport holder must file a tax return to the IRS and pay US taxes, regardless of where they are living or where they are tax resident.
Richard Cassell, partner at Withers, said: ‘Even the mayor of London has acknowledged that US citizens have to pay tax that is due as the price of the passport. The IRS expects tax on house sale gains over the exclusion. The US government just wants to help taxpayers settle up with Uncle Sam. Ultimately a cheque (however spelt) beats oratory and bravado.’
London Mayor Boris Johnson has decided to settle an outstanding US capital gains tax bill ahead of his visit to Boston, New York and Washington next month, according to the FT. The news comes despite him previously declaring he would not pay the ‘absolutely outrageous’ demand from the IRS, which was levied on the sale of his home in North London. Johnson holds dual US and UK citizenship, and one of the legal obligations of holding a US passport is that the passport holder must file a tax return to the IRS and pay US taxes, regardless of where they are living or where they are tax resident.
Richard Cassell, partner at Withers, said: ‘Even the mayor of London has acknowledged that US citizens have to pay tax that is due as the price of the passport. The IRS expects tax on house sale gains over the exclusion. The US government just wants to help taxpayers settle up with Uncle Sam. Ultimately a cheque (however spelt) beats oratory and bravado.’
