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By Joe Baker | Monday, April 24, 2023
There are few nations in the world with as fascinating a history between them as the United States and the United Kingdom. With the flow of citizens between the two countries for work and tourism numbering in the millions each year, there are many reasons why the relationship has remained so strong.
Because of these solid ties, no matter what the reason –whether for tourism, to study or work –making a USD to GBP transfer is a relatively painless affair. Money transfer companies must be registered on a state-by-state basis in the US, but beyond this, there are few restrictions when you transfer dollars to pounds.
OFX provides secure and speedy international money transfers to over 300,000 people in 55 currencies at better-than-bank rates.
Average of the top US Banks costs as compiled by our own FXC Intelligence group
As two of the most powerful currencies currently traded—not to mention, two of the oldest still in continuous circulation—the GBP/USD is one of the most actively traded currency pairs.
Also known as the ‘Cable’ in certain trading circles, the GBP/USD is among the five most widely traded currency pairs. The Bank of England and the US Federal Reserve have a massive influence on the value of both currencies, and interest rate adjustments become events of global importance as companies across the world try to figure out the best way to transfer USD to GBP.
Showing the deep ties connecting the UK with the USA, the two are major trading partners; the US is actually the largest export market for goods and services, with $64.42bn in exports made in 2022.
However, Brexit continues to impact trading relationships, as of early 2023, no UK/US trade deal has been reached. A new trade relationship will need to be settled between the two nations meaning that there is scope for the UK and the US to significantly expand their existing trade relationship – but for now it is uncertain.
If you’re personally looking at purchasing from abroad, when importing goods from the UK you will need to declare your imports to customs and pay VAT and duty on them; some goods may also require an import licence. Given the volume of trade between the two countries, there are many options available when financing imports, transferring money to the UK, and organising shipping. However, as the current situation with Brexit is up in the air, there are no guarantees that the current levels of trade will be maintained or that there will remain minimal tariffs on trade between the two nations.
For those looking to open a bank account in the UK, you will need proof of income and employment, evidence of a local address, and a valid passport. Since the introduction of new legislation under FATCA in 2014 it has become slightly more complicated to open a foreign bank account.
While there isn’t a definitive best way to send money from US to UK, bank transfers are the most common. But as bank transfers can offer poor exchange rates and additional fees, there could be cheaper alternatives if you do your research. Similarly, wiring money from US to UK is mostly transacted through a current account in either country.
UK banks are quite lax with service charges on small transactions, such as issuing cheques or drawing money from ATMs. Additionally, credit cards are less common in the UK than in the US and require a chip and pin to use them, rather than in the US where a signature is still needed. Contactless payments are also used widely, making for speedy transactions.
An important thing to remember: the UK tax year runs from 6 April to 5 April of the following year, whereas the US tax year is a calendar year. This difference will have implications for your tax planning.
As the US and UK have a treaty in place to reduce double taxation, if your residency is with just one country, you generally should not be subjected to two full tax payments. However, do extensive research and speak to a financial advisor before making any moves, as there are exceptions that could be costly.
As it stands, Brexit and an unstable economy have lowered the value of GBP to a much lower rate, so Americans are able to get more pounds for their dollar than in the past. Fluctuations in exchange rates are common though, so make sure to keep up to date with current rates.
Here’s where things can be complicated. The UK and US visa systems can be complex. Most people moving to the other country to work, however, will be sponsored by a company that will handle the process.
If you are planning on moving to the UK to work and are considering sending funds to finance this, then you will need to obtain a valid visa. The UK has a points-based visa system. When moving to the UK, the most common type of work visa is a Skilled Worker Visa, which covers, among other things, inter-company transfers and people with new job offers. Specific requirements for this visa include your job being eligible, your employee being approved by the Home Office, and your salary.
If moving to the US, the most common visas are non-immigrant visas, where you are either sponsored by your UK company (L class visas) or are moving over to work for a US firm sponsoring you (H class visas). Students obtain F visas, and there are also E class visas available for investment and entrepreneurial activities. Whatever the situation, you will need to have obtained your visa before you can start work in the US. Further details are available on the USCIS website.
The UK has become an increasingly attractive place for foreigners to invest in property. For some overseas purchasers, this could be because of a desire to acquire residential property for their own and/or family’s occupation, or for investment. Unsurprisingly, commercial property is also seen as an attractive investment.
Luckily, there are few restrictions on foreign nationals or overseas companies buying or renting property, with the main considerations being related to tax. As such, it is recommended that you engage specialist tax advice in advance of your property search, whether private residential or commercial investment, particularly if you or a company are non-resident in the UK.
The UK is the favourite destination for Americans studying overseas, with 22,990 US students attending UK universities in the 2021/2022 academic year. Course structures differ in the UK too, with typical undergraduate degrees being shorter – three years and one year for a Masters, meaning they not only take less time but also cost less.
However when it comes to tuition fees, international students have higher fees than nationals in the UK, with course costs different depending on the university. Tuition fees alone can be between £11,400 and £38,000 annually, with additional living costs estimated to be around£900-£1400 per month (the higher end applying to those in London). On the other hand, for US citizens studying abroad may actually be cheaper than studying in the States. Another big attraction to study in the UK is the ease of visiting continental Europe, with lots of cheap flights available.
For those intending to attend one of the many UK universities, a student visa is required. Once you have a place at an accredited institution, the process of applying is simple, but you have to be able to demonstrate that you have sufficient savings to fund your course and cost of living. Part-time employment will be subject to what you’re studying and if you’re working during term time. For more information, visit the gov.uk website.
For the best way to send money from US to UK, make sure to check out the most trusted names in international payments. See our money transfer provider reviews, here.
Since its founding, the USD has remained the world’s most influential and stable currency, which is why we see countries outside the US adopting it as either a primary or secondary currency.
According to the Department of Commerce, the trade relationship between the US and the UK supports an estimated 665,000 individual jobs.
All the companies displayed above are fully-regulated by their relevant authorities and licensed to offer money transfer services. Each is authorised by local authorities such as the Financial Conduct Authority (FCA) in the UK, or FinCEN in the US.
Exact transfer times will depend on where the money is being sent, how the recipient will receive the money, and the transfer method chosen. Traditional bank transfers can take anywhere from a few hours to a few days, while debit and credit card payments can be processed much more quickly.
The first thing you should do is to review the comparison results above and check how much it might cost you to make a USD to GBP transfer. Choose a provider based on the actual price they offer for the transfer, the speed the transfer will take, as well as their overall rating. Once you have selected a provider, click the green button to be taken to their website where you can create an account. Once you are fully verified, you can then begin wiring money from the USA to UK.
The results displayed above will fluctuate in line with real-time movements in the currency market. Certain providers might also offer different pricing depending on how are going to send a given sum of money, or even what type of account you have with them. FXcompared might also offer special rates to new customers who sign up to a provider using the FXcompared website. Make sure you confirm the total cost of the transfer with the provider before committing to it and making the bank transfer from America to UK.
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All the providers listed are regulated by the relevant authority (e.g. the FCA in the UK, FinCEN in the US, ASIC in Australia) and have been vetted by FXcompared.
FXcompared.com is an fx money comparison site for international money transfer and to compare rates from currency brokers for sending money abroad. The website and the information provided is for informational purposes only and does not constitute an offer, solicitation or advice on any financial service or transaction. None of the information presented is intended to form the basis for any investment decision, and no specific recommendations are intended. FXC Group Ltd and FX Compared Ltd does not provide any guarantees of any data from third parties listed on this website. FX compared Ltd expressly disclaims any and all responsibility for any direct or consequential loss or damage of any kind whatsoever arising directly or indirectly from (i) any error, omission or inaccuracy in any such information or (ii) any action resulting therefrom.