Discover how Ed Sheeran’s move to Nashville could impact his tax bill, comparing UK vs US residency rules in 2025/2026. Learn key insights for globally mobile earners.
British superstar Ed Sheeran has confirmed he’s moving to Nashville, Tennessee in a recent podcast. Known for his global hits and staggering estimated £370 million net worth, Sheeran says Music City has always been his “end goal.” Beyond the music scene, his relocation could also have major tax implications.
If Sheeran stayed fully UK-resident, his earnings would be subject to the UK’s top-rate income tax and National Insurance contributions, which together could take a large slice of his income. Following the 2025 tax changes, UK residents will be taxed on their income worldwide, highlighting the increasing importance of residency planning.
Aside from touring logistics and the incredible country music scene in that part of the world- the US Tax regime, in Tennessee in particular, offers a lighter contrast to the current UK system. According to the IRS, the federal income tax top rate is 37% for income above $609,351 and Tennessee has no individual state income tax (1),though residents still pay sales and property taxes. For businesses, U.S. corporations face a flat 21% federal tax, with dividends taxed up to 23.8%. Tennessee’s corporate income tax is 6.5% according to the Tax Foundation.
Unsurprisingly, Ed does not leave a modest life. To estimate any tax savings, we first estimate his earnings. Although we are The A Team we are not Ed Sheeran’s personal accountants, and this article is based solely on publicly available information about his earnings from recording, performing, and music management. Ed also has a bar, property investments and a minority stake in Ipswich Town FC, we’ve assumed no income from these. Unlike his pop ballad, this summary isn’t Perfect but based on the most recent available figures for Ed Sheeran Limited; Gingerbread Man Records Ltd and HAYAGOTATOURBOI TOURING UK LLP. Here’s our summary of Ed’s income and tax position:
The UK tax system is “harsh” on high earners: income above £125,140 is taxed at 45%. Director‑shareholders taking dividends pay an additional 39.35% on dividend income. Companies like Ed Sheeran Ltd now pay corporation tax at 25% on profits over £250,000. Ed Sheeran Ltd accounts to 31 December 2024 are due shortly, we’ll be sure to update our assumptions when we read them.
If we assume Ed Sheeran’s success continues, which seems likely given his talent, hard work and business flair, then for simplicity we can imagine he generates a similar level of income as a resident of Nashville, Tennessee.
*We have kept Ed Sheeran Ltd as a UK based entity, it appears that Ed’s touring company is set up for each tour and we are working on the basis a new one is setup to coincide with his US move.
Becoming resident in Tennessee makes two big differences. First, the absence of state income tax means Sheeran would pay only the federal top rate of 37% on earned income. And 23.8 % tax on qualified dividends. By paying US tax rates on his income Ed Sheeran is saving £3.2m.
(Side note: The £19.7m lost to UK government could fund 540 NHS nurses).
Tax planning is never simple, Ed Sheeran would have to establish genuine U.S. residency and may still pay UK tax on royalties generated in Britain. He would also face U.S. self‑employment and Medicare taxes. But Nashville’s tax environment is undeniably kinder to high‑earning artists than Britain’s. For a star whose 2023 earnings exceeded £20 million the potential saving of around £3.2 million a year is hardly “pennies” and he could probably get himself a big Sapphire for that! (Sorry, that's the last of the Sheeran song references from us).
Tax planning isn’t just about picking a low-tax location. Lifestyle, touring schedules, and compliance with both UK and US rules all matter. For example, even if someone spends most of the year in Nashville, UK rules could still classify them as UK-resident for part of the year if they maintain certain ties (HM Treasury, 2024). Strategic planning is key- which is where expert accounting advice comes in.
To be fair to Ed Sheeran, Nashville has clear professional reason, unlike tax havens such as Dubai and The Maldives which would most likely offer even greater tax savings.
All calculations are approximate. They ignore allowances, deductions, Medicare and Social Security levies and assume all profits are distributed as dividends.
1. Bronner S. States With No Income Tax 2025 [Available from: https://www.investopedia.com/financial-edge/0210/7-states-with-no-income-tax.aspx#:~:text=Hampshire%2C%20South%20Dakota%2C%20Tennessee%2C%20Texas%2C,gains%20of%20certain%20high%20earners.
2. IRS. Federal income tax rates and brackets 2024 [Available from: https://www.irs.gov/filing/federal-income-tax-rates-and-brackets#:~:text=2024%20tax%20rates%20for%20a,single%20taxpayer.
3. Full Accounts of HAYAGOTATOURBOI TOURING LLP made up to31 March 2024 as filed at Companies House. https://find-and-update.company-information.service.gov.uk/company/OC373130/filing-history
4. Full Accounts of Ed Sheeran Ltd Company Accounts made up to 31 December 2023 filed at Companies House https://find-and-update.company-information.service.gov.uk/company/07509083/filing-history
Working with us
1. Discovery
Understand your personal and business financial goals.
2. Tailored
Service proposal to achieve your goals.
3. Systemise
Your Cloud Finance Team becomes aseamless, predictable part of yourbusiness.
4.Value-add
We offer insight and opportunities forsavings and growth on the back ofrobust numbers.
5. Rework
Life happens, we re-engage annualadjusting for change in circumstances.
"Seamless upgrade to Xero accounting for the business. Cloud Finance now oversee all aspects of our finance function remotely. Recommend their services."
"Seamless upgrade to Xero accounting for the business. Cloud Finance now oversee all aspects of our finance function remotely. Recommend their services."
"Seamless upgrade to Xero accounting for the business. Cloud Finance now oversee all aspects of our finance function remotely. Recommend their services."
"Seamless upgrade to Xero accounting for the business. Cloud Finance now oversee all aspects of our finance function remotely. Recommend their services."
Andy Kelly
The Leadership Factory
"Cloud Finance have supported one of our portfolio company’s by managing all financial aspects of the business including bookkeeping, supplier payments, credit control and management accounts. They also assisted with financials for a recent fund raise and provide board input. Their service has been high quality from start to finish, ensuring a robust finance function and providing support when needed. Recommend their services."
"Cloud Finance have supported one of our portfolio company’s by managing all financial aspects of the business including bookkeeping, supplier payments, credit control and management accounts. They also assisted with financials for a recent fund raise and provide board input. Their service has been high quality from start to finish, ensuring a robust finance function and providing support when needed. Recommend their services."
"Cloud Finance have supported one of our portfolio company’s by managing all financial aspects of the business including bookkeeping, supplier payments, credit control and management accounts. They also assisted with financials for a recent fund raise and provide board input. Their service has been high quality from start to finish, ensuring a robust finance function and providing support when needed. Recommend their services."
"Cloud Finance have supported one of our portfolio company’s by managing all financial aspects of the business including bookkeeping, supplier payments, credit control and management accounts. They also assisted with financials for a recent fund raise and provide board input. Their service has been high quality from start to finish, ensuring a robust finance function and providing support when needed. Recommend their services."
Scott Carnegie
Actual Analytics Limited.
“They’ve reduced our weekly reporting preparation time by 50% and improved the quality of information. All for around half of our previous spend in this area”
“They’ve reduced our weekly reporting preparation time by 50% and improved the quality of information. All for around half of our previous spend in this area”
“They’ve reduced our weekly reporting preparation time by 50% and improved the quality of information. All for around half of our previous spend in this area”
“They’ve reduced our weekly reporting preparation time by 50% and improved the quality of information. All for around half of our previous spend in this area”
Ronald Napier
First Task Recruitment
“Cloud Finance took the time to understand both my business and the vision I have for its future to provide strategic financial support.”
“Cloud Finance took the time to understand both my business and the vision I have for its future to provide strategic financial support.”
“Cloud Finance took the time to understand both my business and the vision I have for its future to provide strategic financial support.”
“Cloud Finance took the time to understand both my business and the vision I have for its future to provide strategic financial support.”
Dr Fiona Wilson
The Edinburgh Practice