EIM40033 - Earnings paid in foreign currency

General earnings taxable when received

General earnings that are taxable when received by virtue of the charging provisions in Sections 15, 21, 25 or 27 ITEPA will be chargeable whether paid or payable in foreign currency. It is simply necessary to quantify the amount chargeable in pounds sterling.

The amount chargeable is strictly the sterling equivalent at the date the employee becomes entitled to be paid the earnings or, if earlier, the date they are paid. This can be calculated using the relevant exchange rates in operation at the time.

No deduction can be given for costs of converting currency or for losses incurred on the exchange.

General earnings taxable when remitted to the United Kingdom

For earnings that are taxable when remitted to the United Kingdom the conversion should be made at the date they were remitted. (See EIM40301 for the meaning of “remitted to the United Kingdom”.)