Similarly, US expats have to fill out Report of Foreign Bank and Financial Accounts (FBar) forms, where they have more than $10,000 in their bank accounts, anywhere overseas, and they have to declare it.
There is also the issue of double taxation, whereby the client could be subject to tax both from the US and the UK.
In this instance, they tend to get taxed at whichever jurisdiction is charging the higher rate, and get a credit from the other authority.
Mr Vadgama says: "The main thing is all the reporting requirements; the main problem is they come to the UK and they have to declare worldwide income in the US."
It is also one of the reasons why financial advisers have been reluctant to take on US citizens as clients.
He says: "If you step back 10 years, no-one wanted to touch US individuals, and there were only one or two financial advisers who dealt with US individuals.
"But two or three years ago, everyone started coming back.
"It isn't that difficult, it's just a question of completing more forms. It's not going to cost that much."
Similarly, if an adviser has a client who holds a green card or a US passport, they may feel out of their depth planning for every eventuality.
In this case it is best to outsource to a specialist US tax accountant, who can know all the pitfalls and plan to mitigate the worst of one's tax liabilities.
Melanie Tringham is deputy features editor of Financial Adviser and FTAdviser.com