Platform · United Kingdom
Hargreaves Lansdown & PFICs for US persons
The UK's largest platform, its fund range, and the three wrappers — dealing account, ISA, SIPP — each of which lands differently on a US return.
By Danilson Ramos · Founder, Atamatax
Updated September 2026
Check it for your own holding
Could this investment be a PFIC?
Two questions and, if you have it, the ticker or ISIN. The read is immediate, nothing you enter leaves this page, and it names what would settle the rest.
Free, no account, nothing you answer leaves this page. Open the full portfolio scanner
Screened against the fund registry on this page. It is never sent anywhere.
A screen. Whether a fund is a PFIC turns on its own annual income and asset facts under §1297; the read above says how far your answers go and what would settle the rest.
Hargreaves Lansdown is where a large share of British investing happens, and its range — UK OEICs and unit trusts, Irish-domiciled ETFs, investment trusts — is almost entirely non-US pooled vehicles. For a US person that is PFIC territory, and the wrapper the funds sit in decides how much else rides along.
Can a US person use Hargreaves Lansdown?
HL generally does not open new accounts for US persons and restricts what an existing US-person client may hold — confirm current policy with HL. The US persons holding HL accounts in practice are dual citizens, Americans who opened accounts before moving or before acquiring US status, and accidental Americans. The rules below apply to every year the account existed while they were a US person.
Why the funds are PFICs
A UK OEIC or unit trust is a non-US corporation or trust whose assets are securities; an Irish-domiciled ETF is the same thing with a different passport. Both commonly meet the §1297 income or asset test, so each is generally a PFIC: one Form 8621 per fund per year, and the §1291 default regime on any gain or excess distribution unless a QEF or mark-to-market election was made in time. HL's own Wealth Shortlist and multi-manager funds are funds of funds — a PFIC holding PFICs.
| Holding at HL | PFIC? | Typical filing |
|---|---|---|
| OEIC / unit trust (ISIN GB…) | Likely | Form 8621 each year, per fund |
| Irish-domiciled ETF (ISIN IE…) | Likely | Form 8621 each year, per fund |
| Investment trust (a UK-listed company) | Likely — it is a corporation holding securities | Form 8621; the listing does not change the test |
| Individual UK or US company shares | No | Report the account |
| Cash in the account | No | Report the account; interest is taxable |
Three wrappers, three US outcomes
Fund & Share Account — a plain brokerage account: every fund inside is a PFIC question, every dividend and gain is on the US return, and the account is reportable.
Stocks & Shares ISA — HMRC's tax-free status has no US counterpart. The US looks through the wrapper: funds inside are PFICs, interest and dividends are taxable, gains are taxable, and there is no UK tax paid to credit against any of it, because the ISA paid none. This is the wrapper that surprises people most.
SIPP — a pension first. Whether the funds inside are reached by the PFIC rules depends on how the SIPP is characterised for US purposes, and the US–UK treaty's pension article can defer US tax on growth in a qualifying arrangement. That characterisation is a professional judgement, not something a platform statement settles; the SIPP is reportable either way.
FBAR and Form 8938
Each HL account is a foreign financial account: the Fund & Share Account, the ISA, the SIPP and a Lifetime ISA each count toward the $10,000 FBAR aggregate and the Form 8938 thresholds, whatever they hold.
- Export the transaction history for each fund from the first purchase — the §1291 computation needs every lot.
- Export the portfolio valuation at year-end, per account.
- Note each account's maximum balance during the year for the FBAR.
- Keep the consolidated tax certificate for the Fund & Share Account — it is the UK tax you may be able to credit.
Check your HL funds before you file
Paste the ISINs or upload the portfolio export — the free checker flags likely PFICs and estimates the Form 8621 workload. This is general information, not individualised tax advice.
From one fund to the whole case
What does your PFIC situation actually require?
Four questions — how many funds, for how long, whether Forms 8621 were ever filed, whether the returns are current — and a route into the preparation that fits, with what it costs. Nothing you answer leaves this page.
Free, no account, nothing you answer leaves this page. Open the full portfolio scanner
A routing read, not a determination. Whether a fund is a PFIC, whether an exception applies and what a prior year needs are established when the holdings are screened; the route above says where that happens and what it costs.
Authorities cited
- IRC §1291 — IRC §1291 — Interest on tax deferral (excess-distribution regime)
- IRC §1297 — IRC §1297 — Definition of a passive foreign investment company
- IRS Form 8621 — About Form 8621 — Information Return by a Shareholder of a PFIC or QEF
- 31 CFR §1010.350 — 31 CFR §1010.350 — FBAR (FinCEN Form 114) filing requirement and $10,000 threshold
- FinCEN Form 114 (FBAR) — Report of Foreign Bank and Financial Accounts (FBAR)
- IRS Form 8938 — About Form 8938 — Statement of Specified Foreign Financial Assets
- US–UK Income Tax Treaty — Convention between the United States and the United Kingdom (signed 2001) and the 2002 Protocol
Primary sources (Cornell Legal Information Institute for the US Code and CFR; IRS.gov for forms, procedures, and treaty documents). This page is general information, not individualized tax or legal advice.
Atamatax provides tax preparation support and educational resources. This website does not constitute legal or tax advice.