thriftguy

Hi,

I've been trying to do some research, but not having any luck. So I'm hoping somebody out there has done something similar. I am currently working in Canada for a Canadian company remotely from home. What I am looking to do is move back to the UK, but continue with my current employment.

Has anyone here done anything like this before? I am concerned about a couple things:

-Taxes and payroll deductions. I'm assuming I will need to make the appropriate deductions and payments in the UK rather than Canada. I'm thinking I can get around my company not being setup to do this by asking to be switched from a regular employee to a contractor, and then handling my own taxes either as a sole trader or forming a limited company.

-Getting paid. If I'm getting paid in Canadian dollars into a Canadian bank account, I would have to manually transfer funds into pounds monthly or as needed. This doesn't seem optimal. Is there a way to get around this without my employer having to deal in pounds?

Anything else I should be worried about?

lgabriel73

I currently do consulting work from the UK for the US company I work for. I am classed as independent so the US company does not take out any taxes. In the UK I am classed as self employed so am responsible for paying the tax on my US earnings and paying my NI contributions. The US company mails me a check each month and my bank sends it to a clearing house to change into british pounds. The clearing house charges a 7 pound fee for each check. When you get your cheque just simply take it into your bank and they will do the rest.

thriftguy

Thank you, I am relieved that it is possible and not too complicated.

Do you have an accounting service that you rely on, or are the taxes simple enough to figure out on your own?

lgabriel73

Im hoping they are going to be simple enough that I can do them myself.

Pulaski

There is no clearing house for foreign cheques in the UK; your bank sends it to their Canadian correspondent bank, but that's beside the point. And likely gives you a sucky exchange rate. You would get the money faster, and probably more of it in £ terms, if you received it into a "local" bank (US/Canada as applicable) then transferred it to the UK yourself using xe.com or a similar on-line remitter, but the saving would be reduced if you had to pay a/c fees to that bank.

lgabriel73

Since I no longer have a US bank account thats not an option but the exchange rate is pretty much the same as any other services so it doesn't matter. The funds are in my bank account within 2 days so actually its pretty quick.

Pulaski

I'm not sure what you're comparing the FX rate on a check with? .... Have you compared the rate you're getting with the mid rate? (The one usually published as "the exchange rate" by bbc.co.uk and other news services.) If not you may be shocked to find out what the spread is on relatively small FX transactions, and with an on-line exchange/remitter you can claw back most of that excess profit that your bank is making.

My bank uses "mid" +/- 5½%, approx for small transactions, meaning when the USD/GBP mid rate is $1.65, you pay $1.74 for every £1, but for every £1 they only give you $1.56. With xe.com you can get down to +/- 2%, or better, so with those numbers, your bank would be taking about 3½% of your paycheck more than you would give up to an on-line remitter.

lgabriel73

Thanks for your concern but I' am getting a decent exchange rate