Overseas salary payment - exchange rate fluctuation

C_E_Clare

I would like some financial advice if possible but I don't know who to contact regarding this. I have started employment overseas in the Netherlands for a Dutch organisation but due to coronavirus I am working remotely from the UK. 

I have negotiated a monthly salary in Euros, as per my employment contract, however, I am conscious that this could fluctuate with the exchange rate. I contacted my bank (Natwest Plc) to discuss my options, however, the financial advisor said that he was unsure how to proceed - he also stated that he questioned whether I would be charged. 

I am wondering whether it is best to re-negotiate my salary in GBP (although I will be paying tax in NL and not the UK) or whether to brave the unknown with the exchange rate - despite the fact that the Euro is stronger than the pound at present!

Please could you advise on the best course of action?

Many thanks in advance and best wishes  

Brynsam

C_E_Clare said:

I would like some financial advice if possible but I don't know who to contact regarding this. I have started employment overseas in the Netherlands for a Dutch organisation but due to coronavirus I am working remotely from the UK. 

I have negotiated a monthly salary in Euros, as per my employment contract, however, I am conscious that this could fluctuate with the exchange rate. I contacted my bank (Natwest Plc) to discuss my options, however, the financial advisor said that he was unsure how to proceed - he also stated that he questioned whether I would be charged. 

I am wondering whether it is best to re-negotiate my salary in GBP (although I will be paying tax in NL and not the UK) or whether to brave the unknown with the exchange rate - despite the fact that the Euro is stronger than the pound at present!

Please could you advise on the best course of action?

Many thanks in advance and best wishes  

This isn't about financial advice as such. Not sure what you were expecting your bank to say (and I don't understand what the adviser referred to when he said he 'questioned whether you would be charged' - charged for what?), since this is between you and your employer. Are they willing to renegotiate? If not, the question is entirely academic. Otherwise it comes down to how good a deal you can negotiate on a GBP salary.

pjcox2005

It probably depends on how much of your monthly income you need, presumably you could open a Euro bank account get waged paid in in Euros, and then you can choose when to convert back to benefit from exchange rates and use a proportion of it for when in Europe as access for holidays.

Sandtree

Is this a long term role for you or just a fixed term gig?

Whilst they will be in a better position to hedge the FX risk the reality is that most employers don't want to add FX risk to their employment and so certainly try to get a GBP rate but don't be overly surprised if they say no or give you a terrible rate. You'll almost certainly want to get a Euro account so that you can control the timing and amount of exchanging that happens rather than being forced to take your banks rate on the day the money happens to hit.

Your options after that depend on how much money you are talking about, how much you need instant access to and how long this will be going on for.

AskAsk

just open a euro bank account and use euro until you need to get sterling, then just change it.  you may want to put this on the money board as there are banks which are better at exchange rates than the traditional banks.

Tealblue

Why now rather than at the time you were agreeing terms? It's a question, not a veiled criticism.

steampowered

Personally, I'd much rather get paid in Euros.

The pound has been plummeted in value over the past few years, particularly given the Brexit vote in 2016. The negative implications of that have still not got started yet so I suspect that slide in value is likely to continue.

You can open a Euro account in the UK, so get paid there, and switch money over when you are ready.

The key thing is to make sure you minimise your currency exchange costs. Banks will tend to charge you for currency conversions AND give you a rubbish exchange rate. You are much better off using a company like xe.com to switch your Euros into Pounds.

Zellah

OP, forget Natwest or any other high street bank for receiving Euros - they'll sting you very badly on the exchange rate when converting from EUR to GBP. Simply open a Starling bank account, you'll get both GBP and EUR accounts and deposit your salary into your EUR account. Then simply exchange your EUR balance into GBP through the Starling app and once converted into GBP. send this to your regular Natwest account. Couldn't be easier.