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Thread: Is it legal?
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Old 5th Apr 2008, 16:28
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Bealzebub
 
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It is not very clear what you are asking ? If you mean you are being paid in sterling at a euro equivalent rate, then the answer is simple for tax purposes your salary will be whatever you received in sterling for any given tax year.

If you are paid in euros ( for some reason) and have a liability to tax in the United Kingdom, then you would have to convert it to sterling at a declared rate and submit that figure. The revenue can then either accept it, reject it, or require you to provide evidence of the amounts you received.

As you know currency exchange rates fluctuate all the time, so if you are paid in sterling your contract should state the sterling amount you will be paid. If you are paid in euros likewise.

If you believe your employer is short changing you by quoting a salary in one currency, but paying you in another, then ask them to clarify the rates of exchange they are using and how they justify those rates ? If you are still not satisfied, then open a euro account and have your salary paid into that. That way you have some control over the exchange rates used.

The actual wording of your contract of employment may be worth reading again. In addition there is some useful advice on this HMRC page.

A relevant extract reads :
The exchange rate to use would be the rate for the day the calculation is performed, and would therefore vary every time the payroll is run. The Bank of England issues the exchange rates, and there are a number of different sources of information that can help you establish the exchange rate on a particular day. These include:


a) Bank of England website
b) High Street Banks
c) HM Customs & Excise Daily Exchange Rates Helpline (01702 366349)
d) Ceefax / Teletext
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