Why the SA106 Foreign Pages Matter More for Americans Than Anyone Else
The SA106 foreign pages are the part of your UK Self Assessment return where you declare income that arises outside Britain and claim Foreign Tax Credit Relief for tax paid abroad. For most British taxpayers, that means a little interest from a holiday-home account. For a US citizen living in London, however, it means an entire American portfolio: brokerage dividends, Treasury interest, US rental income, 401(k) payments, Social Security and sometimes US-sourced employment income.
Moreover, Americans face a problem nobody else has. You pay US tax on the same income through your Form 1040, so both countries claim it. The US-UK treaty decides which country gives the credit, and the answer changes by income type. Consequently, a figure that is correct in column C for dividends is wrong for interest, and a credit you are entitled to on a US rental is unavailable on a US share sale. At TaxYork, we prepare both returns side by side for high-net-worth Americans, and the SA106 is where we find the most expensive errors.
What the SA106 Foreign Pages Cover
HMRC publishes the SA106 form and its notes each year. The SA106 foreign pages collect foreign savings interest, foreign dividends, overseas pensions and social security, income from property abroad, foreign tax on capital gains and employment income, and gains on foreign life policies. According to the 2025–26 SA106 notes, you must also use them whenever you want to claim Foreign Tax Credit Relief or relief under the new foreign income and gains regime.
Importantly, not everything foreign goes here. Foreign employment income belongs on the Employment pages, with only the foreign tax claimed on the SA106. Similarly, gains on US shares go on the Capital Gains summary, SA108. Therefore, the SA106 is best understood as the income page for passive US income and the credit page for everything else.
Who Must File Them
Every UK resident taxpayer with taxable foreign income must declare it, and GOV.UK's guidance on tax on foreign income confirms that UK residents are taxed on worldwide income. Since the remittance basis ended on 6 April 2025, long-term resident Americans can no longer leave US income offshore to keep it out of UK tax. As a result, far more US citizens now need the SA106 foreign pages than did three years ago, and many are filing them for the first time.
Paper Forms Versus Online Filing
Strictly, the SA106 is a paper supplement. If you file online through HMRC's service or commercial software, the same boxes appear as the "foreign" section of the return, so there is no separate form to post. Nevertheless, the rules, the column structure and the treaty limits are identical, and HMRC's online service does not check whether your foreign tax figure matches the treaty. In other words, the SA106 foreign pages logic applies whichever way you file, and the software will accept a wrong credit without complaint. That is precisely why errors on the SA106 foreign pages survive for years before an HMRC review picks them up.
How the Treaty Decides Which Country Gives the Credit
Before you touch a single box, you need to understand one principle. The UK gives credit only for US tax that the treaty allows America to charge a British resident who is not a US citizen. Anything the US charges you purely because of your passport is America's problem to relieve, not Britain's.
Article 24 and the Treaty-Rate Ceiling
Article 24 of the US-UK income tax treaty sets this out. Under Article 24(6)(b), the UK credit is limited to the tax the US could impose on a UK resident who is not a US citizen. In practice, that means the treaty withholding rates. For portfolio dividends, the rate is 15% under Article 10. For interest, it is nil under Article 11. For gains on shares, it is nil under Article 13(5). The SA106 foreign pages notes say the same thing in plain language: foreign tax is the lower of the tax actually withheld and the amount allowed under the double taxation agreement.
Consequently, even though you may pay 20% or 23.8% of US tax on a qualified dividend through your 1040, HMRC will credit only 15%. Likewise, on US bank or Treasury interest, HMRC gives no credit at all, however much US tax you paid.
Re-Sourcing: How the US Picks Up the Rest
The treaty does not leave you double taxed. Instead, Article 24(6)(c) and (d) switch the direction of relief. Income is deemed to arise in the UK to the extent necessary to avoid double taxation, so the IRS then credits the UK tax that remains after the UK's own 15% credit. Our guide to treaty re-sourcing of US-source income explains the three-bite calculation in detail. For now, the key point is simple. Your SA106 entries and your US Form 1116 must mirror each other, or one country will give relief the other has already given.
The Income Types Where Britain Credits Nothing
Several common American income streams attract no UK credit at all. US bank interest, Treasury interest and gains on US listed shares fall into this group, because the treaty gives the US no right to tax a non-citizen resident on them. Therefore, you enter the gross income on the SA106 foreign pages, leave the foreign tax column empty, and claim relief on the US return instead. Conversely, US rental income and gains on US real estate work the other way, because Article 6 and Article 13(1) give America the first right to tax them.
Completing the SA106 Foreign Pages, Section by Section
Every section of the SA106 foreign pages is laid out in the same columns. Column A is the three-letter country code, which is USA for America. Column B is the gross income before any tax, in pounds. Column C is the creditable foreign tax. Column E is a cross if you claim Foreign Tax Credit Relief, and column F is the taxable amount.
Interest From US Accounts and Treasuries
On the SA106 foreign pages, US bank interest, money market interest and interest on US Treasury bills and bonds go in the "Interest and other income from overseas savings" section, with totals in boxes 3 and 4. Because Article 11 gives the US no taxing right over a British resident's interest, column C should normally be empty for a US citizen. Column F equals column B. Notably, many returns we review show a US tax figure here copied from a Form 1099. HMRC will reject it, and if it slips through, you have claimed a credit on both returns for the same tax.
Dividends From US Companies and Funds
US dividends go in the "Dividends from foreign companies" section, with totals in boxes 5 and 6. Enter the gross dividend in column B, and in column C enter 15% of it, representing the US tax creditable under the treaty. Put a cross in column E and repeat the gross figure in column F. Importantly, the notes also warn that you cannot claim relief on dividends that fall within the £500 dividend allowance.
Two traps sit in this section. First, a US mutual fund or ETF that invests more than 60% in interest-bearing assets pays distributions that HMRC treats as interest, not dividends. Second, most US funds are non-reporting offshore funds for UK purposes, so gains on disposal are taxed as income at up to 45%. That second point does not change the SA106 foreign pages entries for distributions, but it changes everything about your exit.
Pensions, Social Security and 401(k) Payments
The "Overseas pensions, social security benefits and royalties" section, boxes 8 and 9, captures regular US pension income and US Social Security. Under Article 17(3), US Social Security paid to a UK resident is taxable only in the UK, so it belongs here in full. Periodic 401(k) and annuity payments are generally taxable in the UK as the country of residence. By contrast, a genuine lump sum from a US scheme is covered by Article 17(2) and taxable only in America, so it should not be taxed again on the SA106 foreign pages. Instead, disclose it in the additional information box with the treaty reference.
US Rental Property and Real Estate Gains
A US rental property is a separate overseas property business, reported on the property section of the SA106. Here the credit flows the other way. America has the first right to tax, so HMRC credits the US federal tax on the rental profit. HMRC's manual at DT19851 lists federal income tax and the Net Investment Income Tax as admissible taxes. Our guide to US rental property and UK tax covers the depreciation mismatch that often leaves the full UK charge uncredited. Gains on US real estate follow the same logic, with the credit claimed in boxes 33 and 37 to 39 and the gain itself reported on SA108.
US Tax on Employment Income
If you work some days in America and pay US tax on that income, the gross pay goes on the Employment pages. The foreign tax is then claimed in the final section of the SA106 foreign pages, with the details explained in "Any other information". The notes stress that the foreign tax must be the minimum due after every available deduction and relief, so a US liability inflated by a missed exclusion or credit is not fully creditable in the UK.
Exchange Rates, Timing and Supporting Records
Currency is where two correct returns can still produce mismatched numbers. Consequently, it deserves the same care as the treaty analysis.
Which Rate HMRC Expects
The SA106 notes tell you to convert income into pounds at the exchange rate when the income arose. In practice, HMRC accepts a reasonable, consistently applied method for the SA106 foreign pages, including its own monthly exchange rates or an average. The IRS, meanwhile, publishes yearly average currency exchange rates and accepts any consistently applied posted rate. For 2025, the IRS average was 0.759 pounds to the dollar. Our guide to choosing exchange rates for US and UK tax explains why the same dividend can legitimately carry two different values on the two returns.
The Calendar-Year Problem
The US taxes the calendar year, while the UK taxes the year to 5 April. Therefore, your 2025–26 SA106 foreign pages draw on two US Forms 1099: the last nine months of 2025 and the first three months of 2026. Most brokers issue annual forms only, so you need monthly statements to split each dividend and interest payment correctly. Otherwise, you either double count or omit a quarter's income. In our experience, this single timing issue causes more HMRC letters to American clients than any treaty point.
Records HMRC Can Ask For
Behind every figure on the SA106 foreign pages, keep broker statements, Forms 1099, your filed Form 1040, the Form 1116 computation, and a schedule reconciling US-dollar income to the pound figures on the return. HMRC can open an enquiry into an amended or late return, and for offshore income the assessment window can extend to twelve years. Moreover, there is no UK equivalent of a Form 1099 for US income, so HMRC relies on your own schedules when it checks the figures. A clean reconciliation is your best protection.
The FIG Regime, Dividend Rates and 2026 Changes
The SA106 foreign pages changed materially for 2025–26, and they will change again for 2026–27.
The Four-Year FIG Regime
From 6 April 2025, new arrivals who have not been UK resident in any of the previous ten tax years can claim the foreign income and gains regime for up to four years. The claim is made on SA109, and the SA106 then shows the claimed amounts in boxes such as 4.1, 6.1 and 9.1. However, the notes are clear that you cannot claim both FIG relief and Foreign Tax Credit Relief on the same income. For an American, the regime has a further sting. Removing income from UK tax removes the UK tax that would otherwise offset your US liability. Our analysis of the FIG regime trap for US citizens shows when the claim still makes sense.
Dividend Rates for 2025–26 and 2026–27
For 2025–26, the SA106 notes confirm dividend rates of 8.75%, 33.75% and 39.35%, with a £500 allowance. From 6 April 2026, the government has raised the dividend ordinary and upper rates to 10.75% and 35.75%, while the additional rate stays at 39.35%. Savings and property rates rise by two points from April 2027. Accordingly, the UK tax on your US dividends rises, which increases the UK tax available for re-sourcing on your US return.
Deadlines That Apply to the Foreign Pages
The Self Assessment deadlines are 31 October 2026 for a paper 2025–26 return and 31 January 2027 online. The balancing payment and first payment on account for 2026–27 are also due on 31 January 2027. Because the US return for calendar 2025 is due in June 2026 for expats, or October on extension, you normally know your final US tax before completing the SA106 foreign pages. Use that sequence deliberately.
A Worked Case Study: A London Portfolio Holder
The figures below are illustrative, but they reflect a pattern we see every filing season.
Rebecca's US Income
Rebecca shows how the SA106 foreign pages work in practice. She is a US citizen who has lived in London for twelve years and pays UK tax at the additional rate. In 2025–26, her US brokerage paid $100,000 of qualified dividends and $40,000 of Treasury and bank interest. At an illustrative rate of 0.76, that is £76,000 of dividends and £30,400 of interest on her SA106 foreign pages.
Getting the Dividend Entries Right
After her £500 dividend allowance, UK tax on the remaining £75,500 at 39.35% is £29,709. In column C, Rebecca enters the 15% treaty credit, and because no relief is available on the slice covered by the allowance, the credit she actually receives is £11,325. Her net UK tax on the dividends therefore falls to £18,384. On her US return, federal tax on the dividends is $20,000 at 20%, plus $3,800 of Net Investment Income Tax. Under Article 24(6)(c), the first $15,000 of US tax cannot be reduced, but the IRS credits the re-sourced UK tax against the remaining $5,000. As a result, she pays $18,800 to the IRS and about $24,190 to HMRC, a combined rate of about 43% on the income her SA106 foreign pages report as dividends.
Getting the Interest Entries Right
UK tax on £30,400 of interest at 45% is £13,680. Column C stays empty, because the treaty allows the US no tax on a non-citizen's interest. On the US side, federal tax at 37% is $14,800, and the re-sourced UK tax of about $18,000 wipes it out. However, the $1,520 of Net Investment Income Tax remains, because the IRS does not accept a treaty credit against it. Consequently, the interest costs her the UK rate plus 3.8%.
What the Common Mistakes Would Have Cost
Had Rebecca left column C blank on her dividends, she would have paid an extra £11,325 to HMRC while the IRS still collected its $15,000 floor. That error alone costs about $14,900 a year. Conversely, had she entered her full US tax, including Net Investment Income Tax, on both dividends and interest, she would have claimed roughly £19,000 more UK credit than the treaty allows. HMRC would eventually reverse it with interest and potentially a penalty. The correct SA106 foreign pages entries sit between those two extremes, and they only work if the US return mirrors them.
Coordinating the SA106 Foreign Pages With Your US Return
The UK form is only half the calculation. Therefore, the final step is to make sure the two returns tell the same story.
Mirroring Form 1116 and Form 8833
On the US side, re-sourced income goes in its own category on Form 1116, and the IRS explains the treaty mechanics in Publication 514 on foreign tax credits for individuals. The treaty position itself is disclosed on Form 8833. The UK tax figure the IRS credits must be the UK tax after the UK's own treaty credit, which is exactly the net figure that flows from your SA106 foreign pages. If the UK return changes later, for example after an HMRC correction, the IRS generally expects you to report the change as a foreign tax redetermination.
Withholding Certificates at Your Broker
Americans should never give a US broker a Form W-8BEN, which is reserved for non-US persons as the IRS page on Form W-8BEN confirms. Instead, you complete a Form W-9, so the broker withholds nothing. That means your 1099 shows no foreign tax, and the only US tax on your dividends is the tax you pay on your 1040. Consequently, the 15% you enter in column C must be supported by your US return, not by a withholding slip.
When You Have Missed Years
Many Americans in Britain have never completed the SA106 foreign pages or declared their US portfolio to HMRC, often because they assumed their US return covered it. If that applies to you, the priority is to correct the UK position before HMRC raises it. Our guide to missed UK tax returns for Americans explains the disclosure routes. Similarly, if US returns or FBARs are also outstanding, our FBAR and FATCA reporting service brings both sides up to date together.
How TaxYork Can Help
TaxYork provides comprehensive US and UK tax return preparation for Americans in Britain, and the SA106 foreign pages are central to that work. We split each US Form 1099 into UK tax years, apply the treaty-rate ceiling to every item, prepare the Foreign Tax Credit Relief entries, and build the matching Form 1116 and Form 8833 on the US return. Furthermore, we reconcile the exchange rates used on both sides, so the two returns can be defended together.
For clients with US rental property, 401(k) income, Social Security or US workdays, we handle the property computation, the pension treaty analysis and the employment foreign-tax claim. Additionally, our tax treaty optimisation team reviews whether the FIG regime or a portfolio restructure would lower your combined bill. As a result, you pay the treaty rate on each item, and not a penny more.
Conclusion
The SA106 foreign pages look like a routine supplementary form, yet for a US citizen they decide how much of your American income is taxed twice. The rule is consistent once you see it: Britain credits only the US tax the treaty lets America charge a non-citizen, which is 15% on dividends and nothing on interest or share gains, while America relieves the rest through re-sourcing.
Therefore, split your 1099 data by UK tax year, enter the treaty-rate credit in column C, keep interest and share gains credit-free on the UK side, and make sure Form 1116 mirrors every figure. Moreover, review the FIG regime and the 2026 dividend rate increases before you file. Handled that way, the SA106 foreign pages stop being a source of HMRC letters and start doing their proper job.
Contact Us
If you hold US investments, pensions or property while living in Britain, we can prepare your SA106 and your US return together and make sure every credit is claimed once, in the right country. Please book a consultation with our US-UK specialists, email hello@taxyork.com, or call 020 3488 8606.
Disclaimer
This article provides general information about UK Self Assessment and US tax rules as they apply to Americans resident in Britain and does not constitute tax, legal or financial advice. Treaty outcomes depend on your citizenship, residence, the type of income and your individual circumstances, and HMRC forms and rates change each year. You should obtain professional advice before acting on any point discussed here.