US-UK Tax Treaty for Teachers: The Two-Year Exemption in Article 20A

The US-UK tax treaty for teachers exempts a visiting professor, teacher or researcher from income tax in the host country for up to two years. Article 20A of the UK-US Income Tax Treaty applies where you were resident in the other country immediately before the visit and work at a university, college or recognised educational institution. If the visit runs past two years, the exemption is lost for the whole period.

Academic exchanges between Britain and America are common, and the exemption is valuable. However, it works very differently depending on your nationality and the direction of travel. A British lecturer in Boston can pay no US income tax for two years. An American lecturer in Oxford gets a UK exemption but still files with the IRS. This guide explains the US-UK tax treaty for teachers, how to claim it, and the two-year cliff edge.

What Article 20A says

Article 20A was added to the UK-US Income Tax Treaty by the 2002 Protocol. The treaty and protocol are published on GOV.UK in the USA tax treaties collection. The IRS summarises the rule for UK residents in Publication 901, U.S. Tax Treaties.

The four conditions

First, you must be a professor or teacher visiting the host country to teach or carry out research. Second, the visit must not exceed two years. Third, the work must be at a university, college or other recognised educational institution. Fourth, you must have been resident in the other country immediately before the visit began. When all four are met, your pay for that teaching or research is exempt from tax in the host country.

The research limit

The exemption does not cover research carried out mainly for the private benefit of a person or company. Research must be in the public interest. Therefore, a commercially sponsored project whose results belong to the sponsor may fall outside Article 20A.

The two-year cliff edge

The time limit is strict. IRS Publication 901 states that if the two-year period is exceeded, the exemption is lost for the entire visit, including the first two years. It is not a two-year allowance that you use and then start paying tax. Consequently, a contract extension can create a tax bill for income you earned, and spent, long before. You should review the position before you accept any extension that takes the visit beyond 24 months.

How the US-UK tax treaty for teachers works in each direction

The exemption is given by the host country. What your home country does is a separate question, and for US citizens it changes the result.

A British academic in the United States

You give your US employer Form 8233, which claims exemption from withholding on pay for personal services. The employer then pays you without federal income tax withheld. At year end you file Form 1040-NR and report the exempt income. Many visiting academics hold a J-1 visa. A J-1 teacher or researcher is generally an exempt individual for the substantial presence test for two calendar years, and files Form 8843 to say so. State income tax is separate: some US states do not follow federal treaties.

An American academic in the United Kingdom

The UK exempts your teaching pay under Article 20A. However, the saving clause in Article 1(4) lets the United States tax its citizens as if the treaty did not exist. You therefore still report the salary on Form 1040. Because you paid no UK tax on it, you have no foreign tax credit. The usual answer is the Foreign Earned Income Exclusion, which covers up to $132,900 for 2026 (IRS) if you meet the physical presence or bona fide residence test. Our guide to the Foreign Earned Income Exclusion explains the tests, and our US expat tax returns page covers filing from abroad.

Who cannot use the exemption

Article 1(5)(b) preserves Article 20A against the saving clause only for people who are neither citizens nor lawful permanent residents of the host country. As a result, a British academic who holds a US green card cannot claim the US exemption. Our guide to the saving clause exceptions in the US-UK treaty sets out the full list. In addition, someone who was already living in the host country before taking the post fails the residence condition.

Students are covered by a different article

Article 20 deals with students and business apprentices. It exempts payments that arise outside the host country and are received for maintenance, education or training. It does not exempt wages earned in the host country. Therefore, a UK PhD student paid as a teaching assistant by a US university cannot rely on Article 20 for that pay, and Article 20A applies only if the student is in the US primarily as a teacher or researcher.

Social security and reporting

Article 20A deals with income tax only. Social security is governed by US and UK domestic law and the US-UK Totalization Agreement. A non-resident alien on a J-1 visa is generally exempt from US Social Security and Medicare tax on pay for the work the visa covers. Our guide to the US-UK Totalization Agreement explains which country collects contributions in other cases.

An illustrative case

Consider an illustrative UK-resident historian who takes an 18-month visiting professorship at a US university from September 2026. The figures are illustrative. She gives the university Form 8233 and receives her $95,000 salary without federal income tax withheld. She files Form 1040-NR and Form 8843 for each year. In early 2028 the university offers a two-year extension. Accepting would take her visit past two years. The exemption would then fail for the whole period, and US tax on the first 18 months would become due. She weighs that cost against the extension before she signs.

If you are planning an academic move in either direction, book a consultation with our treaty team. We confirm whether the US-UK tax treaty for teachers applies and prepare the claim.

Frequently Asked Questions

How long does the US-UK treaty exemption for teachers last?

The exemption in Article 20A of the UK-US Income Tax Treaty lasts for a visit of up to two years. If the visit exceeds two years, IRS Publication 901 states that the exemption is lost for the entire visit, including the first two years.

How does a UK teacher claim the treaty exemption in the US?

A UK-resident teacher gives the US employer Form 8233, Exemption From Withholding on Compensation for Independent (and Certain Dependent) Personal Services of a Nonresident Alien Individual. The employer then stops withholding federal income tax, and the teacher reports the exempt income on Form 1040-NR at year end.

Does a US citizen teaching in the UK still pay US tax?

A US citizen still reports the salary on Form 1040, because the saving clause in Article 1(4) of the UK-US Income Tax Treaty preserves US taxation of citizens. The UK exemption means there is no UK tax to credit, so most teachers rely on the Foreign Earned Income Exclusion, which is $132,900 for 2026 (IRS).

Can a green card holder use the teacher exemption in the US?

No. Article 1(5)(b) of the UK-US Income Tax Treaty allows the exemption in Article 20A only for individuals who are neither citizens nor lawful permanent residents of the host country. A green card holder is taxed in the US as a resident.

Does HMRC tax a UK academic's US salary during the visit?

That depends on UK residence under the Statutory Residence Test. An academic who remains UK resident is taxable in the UK on worldwide income, including the US salary. One who becomes non-UK resident for the period is generally not taxed in the UK on pay for work done in the United States.

Does a teacher moving to the UAE need a treaty exemption?

No exemption is needed in the UAE, which charges no personal income tax on salaries. A UK teacher's UK tax depends on becoming non-resident under the Statutory Residence Test. A US citizen teaching in the UAE still files Form 1040 and normally uses the Foreign Earned Income Exclusion, because the US has no income tax treaty with the UAE.