How to handle UK and US income, taxes and unions as an American actor

Hi everyone,

Baby number two is nearly seven months old and sleeping through the night so I'm making my mighty blog comeback.

Now, there's so much to catch up on but I thought I'd ease my way in by answering a reader's question. This is from Ann, an American actor in London. It's a tricky one, as anyone working in two countries knows.

Q: I have some questions on behalf of myself and another American actor in London. I'm not in any US unions; she is in US Equity and SAG and UK Equity. If we get a US job through our UK agents, we're assuming our money comes through our UK agents, converted into £. But:

1. Does that require me to join SAG or US Equity in the same way I would if I were in the US? What if one is already a member of UK Equity?
   
2. For her, does that income count in one's yearly US actors unions income tallies?
   
3. Actually, is US-based work paid in UK in £, counted as US income, or UK income? Would it make a difference if it were paid in $ to our US accounts? (Sorry you may need to ask an accountant). Which leads us to...
   
4. Who does your taxes Kosha? Or any recs? We haven't yet found a UK tax accountant here who specialises in actors, and who also knows enough about US tax law to best advise us on issues such as the above, for UK tax. Or vice versa. Help!

A: Phew! Let's break this down. When you say 'get a US job through our UK agents', I'm assuming you mean one that requires you to physically go the the states and work, not a job on a US film, commercial or theatre production shooting in the UK. If your UK agent gets you the work, then yes they would receive payment on your behalf. Even if the job is paid in dollars, your UK agent would take their fee then deposit the rest into your British bank account in pounds. That is unless you specifically ask them to put it into an American bank account, but that is something you must discuss with them.

1. Does getting a US job through a UK agent require you to join an American acting union? It depends on the job and what the contract says. I can tell you my experience, but probably best to speak directly to British Equity, American Equity or SAG as it is a grey area and not immediately obvious. I believe that British and American Equity have a relationship so that if you got a union US theatre job through your UK agent, you could work something out with American Equity. As for SAG, I'm not sure as that's a very specific scenario.
   
   
2. Does the income count in one's yearly US actors' unions tallies? If you're under a US union contract, then yes. If not, then no I'd think.
   
   
3. Is US-based work paid in UK pounds counted as US or UK income? Easy answer - get an accountant who is familiar with US and UK tax law. Basically if you're earning in two countries, you need to file tax returns in both countries. It's my understanding that how the money is taxed depends on where it is earned and spent. You report all income to both countries and when filing your return, mention what monies were taxed by the other country. So when I file my US tax return, I include my UK income (which is now my main income) and give my US accountant details of my UK tax return during that period. For instance, when I used to do web design for American clients while living here in London, I earned in dollars and was paid into my US bank account. Since the money was earned and spent only in the USA, I was only taxed by the US government but not by the UK, since it never entered the country.
   
   
4. Who does my taxes? It seems I spend most of the year doing taxes, as I file for the US and UK as I mentioned above. I have two accountants, one in the UK and one in the USA. They are in touch with each other. My UK accountant is H.L. Barnes, based in Stratford-upon-Avon and they have been good but you can definitely find a cheaper one. They are used to dealing with actors and foreign monies. In the USA I use Verarose Muir (www.verarose.com), who was recommended to me when I worked in Washington, DC. She does lots of actors. A good place to look for an accountant familiar with US and UK tax law is in The American Magazine and the North American Actors Association. It gets so complicated that it is definitely worth the money to get a good accountant and save yourself the headache. Also note - even if you earn nothing in the US and all of your money in the UK you still MUST file a US tax return or face penalties.

Good luck!