A P60 is the UK end-of-year payroll summary issued by your employer. As a US citizen, you must report the income shown on your P60 on your US tax return, converted to US dollars.
The UK taxes you already paid, shown on the P60, can be claimed as a Foreign Tax Credit on Form 1116 to reduce or eliminate your US tax bill on the same income.
Americans living and working in the UK face two tax systems with different tax years, different forms, and different rules.
The P60 sits at the centre of UK payroll reporting, but it has no direct US equivalent, which leaves many expats unsure how to translate it into something the IRS recognises.
This article explains what the P60 contains, how to use it when filing your US return, and what else you need to be aware of as a dual filer.
Key Summary: Reporting P60 on your US tax return
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Americans employed in the UK must report their P60 income on a US tax return every year, regardless of whether UK tax has already been paid on those earnings.
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The UK income tax shown on your P60 can be claimed as a Foreign Tax Credit on Form 1116, which typically eliminates your US tax liability on the same income entirely.
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The UK and US tax years do not align, meaning a single P60 may span two US calendar-year returns. You must allocate income correctly using your monthly payslips.
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Reporting your P60 does not complete your US obligations. UK bank accounts and financial assets may also trigger FBAR (FinCEN 114) and FATCA (Form 8938) filing requirements.
UK P60 Reporting for US Expats
| Topic | Key Rule |
| What is a P60 | End-of-year UK payroll summary issued by your employer after April 5 |
| UK tax year | April 6 to April 5 (does not align with the US calendar year) |
| US filing obligation | US citizens must report all worldwide income, including P60 earnings |
| Currency conversion | Convert GBP to USD using the exchange rate on the date earned, or the annual average rate |
| Where to report income | Form 1040, Line 1 (wages) — using the converted USD amount |
| Double taxation relief | Foreign Tax Credit (Form 1116) — dollar-for-dollar credit for UK tax paid |
| Alternative relief | Foreign Earned Income Exclusion (Form 2555) — up to $130,000 excluded for 2025 |
| National Insurance | Not deductible on your US return, but the US-UK Totalization Agreement may apply |
What is a P60?
A P60 is an official end-of-year tax summary issued by your UK employer after the close of each UK tax year on April 5. It is the UK’s closest equivalent to the US W-2, a consolidated record of what you earned and what was withheld.
Every employed worker in the UK receives one. If you had more than one employer during the tax year, you will receive a P60 from each. The document is used for UK self-assessment, mortgage applications, and, critically for Americans, as the source document when reporting UK employment income on a US tax return.
A P60 contains the following information:
- Total gross earnings from your employer during the UK tax year
- Income tax deducted under the PAYE (Pay As You Earn) system
- National Insurance contributions paid
- Student loan deductions, if applicable
- Statutory payments such as maternity or paternity pay, if received
Why the P60 Matters for US Taxpayers
The US taxes its citizens on worldwide income regardless of where they live. This means the salary shown on your P60 must appear on your Form 1040 just as if you had earned it in the United States.
The key complication is timing. The UK tax year runs April 6 to April 5, while the US tax year runs January 1 to December 31. This means your P60 does not map cleanly onto a single US tax return. A portion of the income may fall into one US tax year and the remainder into the next.
Most expats handle this by reporting income on a calendar-year basis, using payslips or bank records to determine how much of their P60 income falls into each US tax year. Your employer or payroll provider can often supply a calendar-year breakdown on request.
Most Americans in the UK Owe $0 in US Tax
With the right credit strategy, your P60 income often results in no additional US liability. Let our team of tax professionals show you.
How to Report Your P60 on Your US Tax Return
Step 1: Convert GBP to USD
The IRS requires all foreign income to be reported in US dollars. You can find the relevant rates on our IRS exchange rate page. You have two options:
- Date-of-payment rate: Use the GBP/USD rate on the date each payment was made. This is the most precise method.
- Annual average rate: Use the IRS annual average exchange rate for the tax year. This is simpler and acceptable for wage income paid regularly throughout the year.
Step 2: Report Gross Income on Form 1040
Take the gross income figure from your P60 (the total wages before any deductions), convert it to USD, and report it on Form 1040, Line 1a (wages, salaries, tips). Do not use the net pay figure. The IRS requires gross income; deductions and credits are handled separately.
If you have multiple P60s from different employers, add the converted figures together and report the total.
Step 3: Claim the Foreign Tax Credit or FEIE
This is where you prevent double taxation. You have two main options:
Option A: Foreign Tax Credit (Form 1116)
The Foreign Tax Credit gives you a dollar-for-dollar reduction of your US tax liability for income taxes already paid to the UK. The UK income tax shown on your P60 is the figure you use to calculate the credit.
For most Americans in the UK, where the UK income tax rate is typically higher than the US rate, the FTC will eliminate the US tax liability on employment income entirely. Any excess credit can be carried forward for up to 10 years.
Option B: Foreign Earned Income Exclusion (Form 2555)
If you qualify under either the Physical Presence Test or the Bona Fide Residence Test, you can exclude up to $130,000 of earned income from US tax for the 2025 tax year (the figure adjusts annually for inflation).
The FEIE can be more straightforward to apply, but it has a drawback in the UK context. Once you elect the FEIE, any income above the exclusion limit is taxed starting from the bottom of the US tax brackets rather than where the excluded income left off.
This is known as the stacking rule.
Step 4: Handle National Insurance Contributions
Your P60 will also show National Insurance (NI) contributions deducted from your pay. NI is a social contribution, not an income tax, and it is not eligible for the Foreign Tax Credit on your US return.
However, the US-UK Totalization Agreement means you generally cannot be required to contribute to both the US Social Security system and the UK National Insurance system on the same earnings. If you are employed by a UK employer and paying NI, you are typically exempt from US self-employment tax or Social Security contributions on that income.
Filed by CPAs Who Know UK Expat Taxes
Our team at Universal Tax Professionals has handled thousands of US returns for Americans in the UK across every income situation.
The UK/US Tax Year Mismatch
The April 5 close of the UK tax year creates a practical challenge. Your P60 summarises income from April 6 of the prior year to April 5 of the current year. Your US return covers January 1 to December 31.
To file accurately, you need to determine how much of your P60 income falls into each US calendar year. The most reliable approach is to use your monthly payslips to identify the calendar-year split. Most UK employers can provide a calendar-year payroll summary on request, and it is worth asking before you file.
| UK Tax Year (P60) | Overlaps with US Tax Years |
| April 6, 2023 to April 5, 2024 | 2023 return (Jan to Dec 2023) and 2024 return (Jan to Apr portion) |
| April 6, 2024 to April 5, 2025 | 2024 return (Jan to Dec 2024) and 2025 return (Jan to Apr portion) |
| April 6, 2025 to April 5, 2026 | 2025 return (Jan to Dec 2025) and 2026 return (Jan to Apr portion) |
What If You Have Other UK Income?
The P60 covers employment income only. If you have other sources of UK income, each must be reported separately on your US return.
- Rental income: Report on Schedule E. Net rental income after allowable expenses is taxable; the FTC applies to any UK tax paid on that income. See our guide on foreign rental income reporting.
- Self-employment or freelance income: Report on Schedule C. Self-employment tax may apply unless covered by the Totalization Agreement.
- P11D benefits in kind: Taxable benefits such as a company car, private healthcare, or gym membership reported on a P11D must be included in your US income figure.
- Investment income: Dividends and interest from UK bank accounts or investments are reported separately and are not eligible for the FEIE, though the FTC may apply.
Additional Considerations for Americans in the UK
US State Tax Returns
If you remain a legal resident of a US state that taxes worldwide income (such as California, New York, or Virginia), you may also be required to file a state tax return and report your UK earnings there.
Some states do not recognise the FEIE, which can create a state tax liability even when your federal liability is zero. Establishing non-residency in your home state before moving abroad is often worth the effort.
FBAR and FATCA
If you hold a UK bank account (which virtually all Americans working in the UK do), you likely have FBAR and FATCA obligations:
- FBAR (FinCEN 114): Required if the combined balance of your foreign accounts exceeded $10,000 at any point during the calendar year. Filed separately from your tax return, due April 15 with an automatic extension to October 15.
- Form 8938 (FATCA): Required if your foreign financial assets exceed $200,000 at year-end (single filers) or $400,000 at year-end (married filing jointly). Filed with your Form 1040.
Filing Deadlines
Americans living abroad receive an automatic two-month extension to June 15 for filing their US return. If you need more time, you can request a further extension to October 15 by filing Form 4868.
Note that extensions cover filing, not payment. Any tax owed is still due by April 15 to avoid interest charges.
What If You Have Never Filed?
If you are an American who has been working in the UK and has never filed a US return, you are not alone, and there is a structured path to catch up without penalties.
The IRS Streamlined Foreign Offshore Procedures allow non-wilful non-filers to come into compliance by filing three years of back returns and six years of FBARs, with no late-filing penalties.
