Compare · United Kingdom vs United States
United Kingdom vs United States for Australians leaving home
United Kingdom:Worldwide taxAU tax treatyUnited States:Worldwide taxAU tax treaty
United Kingdom and United States run the same headline regime, worldwide tax, so the decision turns on the details underneath: what each one does to capital gains, dividends and the Australian income you keep.
Both have a tax treaty with Australia, so either way you get a tie-breaker if the ATO contests your departure, and capped withholding (15%/10% vs 15%/10% on unfranked dividends/interest).
United Kingdom is the cheaper place to live day to day, roughly 105% of Sydney's basket against United States's 115% (indicative, ex-rent), which can outweigh a thinner tax saving over a full household budget.
Personalise this, enter your numbers once and every figure below becomes yours: “your estimated income tax: $14,200”, not “0, 22%”. Open the Country Comparison tool →
| 2 destinations | United KingdomUnited Kingdom | United StatesUnited States |
|---|---|---|
| Tax | ||
| Regime | worldwide, taxes worldwide income | worldwide, taxes worldwide income |
| Income tax on salary | Progressive 20/40/45% plus employee NI (8% then 2%). The £100k, £125k allowance taper creates a 60% effective band. A £120k salary pays roughly 36% effective with NI. | Federal 10, 37% plus state tax (0, 13.3%) plus FICA (7.65% employee side). A US$150k salary in California pays roughly 30%+ combined; in Texas closer to 24%. |
| Capital gains | 18% basic / 24% higher rate on shares and crypto, £3,000 annual exemption. FIG-regime arrivals: foreign gains tax-free for 4 years. (24% typical) | Long-term (12+ months) federal rate 0/15/20% plus 3.8% NIIT above ~US$200k income; short-term gains at full ordinary rates. States tax gains as ordinary income, California adds up to 13.3%. (15% typical) |
| Dividends | 8.75/33.75/39.35% above a £500 allowance. Australian franking credits are not recognised, but for FIG-regime arrivals, Australian dividends are simply outside UK tax for 4 years. | Qualified dividends at 15% (20% top). Australian franking credits are invisible to the IRS, franked dividends are just taxable income with a credit for the AU WHT. |
| Interest | Taxed locally around 40% | Taxed locally around 24% |
| Crypto | Crypto disposals are CGT events at 18/24% with a small annual exempt amount (£3,000). Swaps and spending count. HMRC receives exchange data; FIG-regime arrivals can realise foreign crypto gains UK-tax-free in years 1, 4. | Crypto is property: every disposal (including spending and swaps) is a capital gains event, short-term gains at ordinary rates, long-term at 0/15/20%. Broker reporting to the IRS is now systematic. |
| Australia tax treaty | Yes, AU withholding capped at 15% dividends / 10% interest, tie-breaker available | Yes, AU withholding capped at 15% dividends / 10% interest, tie-breaker available |
| Social security | Employee National Insurance (8% to ~£50k, 2% above) is excluded from the calculation above, add it for employment income. | FICA (6.2% social security capped + 1.45% Medicare uncapped) applies to US employment; a totalisation agreement with Australia prevents double super/social security in most postings. |
| Visa | ||
| Best pathways |
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|
| Visa ease | 6/10 | 6/10 |
| Family on visas | Dependants covered on main pathways | Dependants covered on main pathways |
| Fastest timeline | ~2 months on the quickest pathway | ~2 months on the quickest pathway |
| Money | ||
| Rent (family home, monthly) | $6,500/mo | $7,500/mo |
| Rent (couple, monthly) | $4,200/mo | $4,500/mo |
| International school (per child/yr) | Free / local system viable | Free / local system viable |
| Health cover (family/yr) | $4,000 | $20,000 |
| Cost of living vs Sydney | 105% of Sydney (ex-rent) | 115% of Sydney (ex-rent) |
| Relocation one-off | ~$25,000 | ~$30,000 |
| Flights home (return, pp) | $2,400 | $2,000 |
| Life | ||
| Timezone vs AEST | 9h behind | 18h behind |
| Flight from Sydney | ~22 hours | ~13.5 hours |
| English | 10/10 | 10/10 |
| Safety | 8/10 | 6/10 |
| Healthcare | 8/10 | 8/10 |
| Schooling | 9/10 | 8/10 |
| Climate | Mild, grey and damp, the winters are dark more than cold, and Australians feel it. | Continental spread, LA is 20, 28°C and sunny most of the year; pick your city, pick your climate. |
Costs, rates and visa figures are country-module data marked indicative until individually verified; FX and rental markets move constantly.
Honest downsides, side by side
Every destination hub on this site carries its downsides in the open. Here are both lists together, because the right question is rarely “which is better?” and usually “which set of problems would you rather live with?”
United Kingdom
- This is a higher-tax country than Australia for most: 40% starts around A$100k equivalent, NI stacks on top, and the £100k, £125k taper creates a 60% zone with childcare cliff-edges.
- London costs Sydney money without Sydney weather, and the FIG honeymoon is exactly 4 years, after which worldwide taxation lands in full.
- Visa costs are the world's highest: fees plus the health surcharge can run £15, 20k for a family before anyone earns a pound.
- Winter darkness (8-hour days, weeks of grey) is the quiet reason many Australians go home.
United States
- This is a move for career and earnings, not tax, combined federal + state + FICA in a coastal city will roughly match or exceed your Australian rate.
- Healthcare is tied to employment and ruinously expensive without it; a family plan's premiums and deductibles can exceed A$25k/year of exposure.
- The IRS relationship is sticky: green card holders are taxed on worldwide income for life until formal surrender, and FBAR/FATCA reporting on Australian accounts carries brutal penalties for innocent omissions.
- Your superannuation is a US tax problem: no treaty article clearly protects it, and treatment (foreign grantor trust? employee trust?) is unsettled, specialist advice is non-optional.
- Gun violence, litigation culture and the cost of failure (no safety net) are real quality-of-life deductions Americans price in and Australians don't.
Make this comparison yours
The table above shows the general figures. Enter your income and family once and the tax rows become your numbers, “your estimated income tax in London: $14,200”, not a range.