6 ms·

One thing I wish were available with many of these US-based services is billing in GBP.

raiyu 12y ago
At the moment all of our billing across all of our geographies is done in US dollars, which given the exchange rate of the UK and EU is usually within your favor. Is there a conversion charge that your credit card company levies on you for paying in US$?
- drtse4 12y ago
  Regardless of the company, there is always a conversion charge around 2% and the rate applied is never the actual rate, banks usually calculate a rate using some kind of moving average.
- vertex-four 12y ago
  My bank will charge £1.50 plus a variable commission for paying in anything but GBP.
  - jordanthoms 12y ago
    Ouch. Seems credit cards out of the US are nowhere near as good, common there to have no foreign transaction fees (apart from probably some margin on the exchange rate).
    - fendale 12y ago
      If you shop around in the UK for a credit card, you will get one with zero fees and an excellent exchange rate on foreign currency transactions. I use the Halifax Clarity card and I believe The Nationwide and the Post Office do a good card too. I'd never use a Debit Card for foreign currency transactions though, they always seem to have fees involved.
      - Osmium 12y ago
        > I'd never use a Debit Card for foreign currency transactions though, they always seem to have fees involved. Nationwide used to have commission-free cash withdrawals on their debit cards abroad, but I think it was abused by people who had second homes in other countries so withdrawn a year or two ago. I believe they still offer a commission-free credit card though.
        bryanlarsen 12y ago
        My impression was that the banks made a lot more money from the spread than they did from the commission, so I kind of find that surprising. In Canada it's easy to find commission-free cards. The spread is a hidden fee though, so the banks have hiked that up several times.
        gabemart 12y ago
        The commission-free withdrawals abroad were offered at the wholesale VISA rate. Nationwide didn't take any vig. Their "Select credit card" still offers EUR and USD purchases with no surcharge and no vig.
        fendale 12y ago
        I'm pretty sure the Halifax card I mentioned gives the Visa wholesale rate too. I generally get same rate as quoted on FX sites anytime I've checked it.
  - kintamanimatt 12y ago
    Who's that? Halifax? They're great for everything else but non-GBP debit card transactions, and why I moved to HSBC and Co-Operative Bank. CaxtonFX are also really good for foreign currency cards (2% markup, which is lower than I get with any of my British banks) and have really good customer service too.
- Gmo 12y ago
  AFAIK, every bank (including for instance Paypal) charges a fee for conversion. At least, it's the case with my French and my Dutch bank. That's one of the great benefit of the Euro when shopping in the EU (well, except for our British friends :) ) Edit: corrected a typo
- marcosscriven 12y ago
  I'm not sure how the dollar price would be in my favour, if you've not specified what the GBP price would be? Sure, once you've set the price it could go either way. Anyway, as others have said, there are charges and spreads on foreign currency banking. It also adds complications to my otherwise very simple accounting needs.
- justincormack 12y ago
  Its not in our favour unless our exchange rate appreciates every month more than our fees. And yes we get charged just like you would if I charged euros to your card.
  - jordanthoms 12y ago
    Most good US cards don't charge an extra fee for non-USD transactions.
    - kintamanimatt 12y ago
      They do, they just hide it in the applied exchange rate.
      - vamega 12y ago
        This is not true. All Mastercard and Visa cards charge a rate that is specified my Mastercard and Visa on a daily basis. I've been tracking this rate for a few months now, and it's consistently been awfully close to the rate I find on xe.com. The CARD Act of 2009 mandated that credit card issuing companies clearly describe the fees associated with foreign transactions. Visa/Mastercard charge a cross border origination fee of 0.80%. However many credit cards (all cards by Captial One for example) waive this fee, and do not charge any fee of their on on top of this.
- petercooper 12y ago
  I'm not speaking for Marco, but another issue with dollars is tax accounts (and especially VAT accounts) for British companies have to be in pounds, so there's overhead in doing the conversions, tracking the exchange losses/gains, etc. We also have to reverse charge the VAT on those transactions as well (though I'd be surprised if the majority of business owners know they have to do that). About 90% of my company's expenses are in dollars, so I've had to become proficient at dealing with it, but I imagine it's more annoying for companies who only make the occasional USD transaction, especially as they may have smalltime accountants unfamiliar with or unwilling to deal with the exchange rate stuff properly.
  - corford 12y ago
    Can't you just use the monthly tables published by HMRC for the exchange rate (IIRC, packages like Xero do this automatically for you?). For the reverse charge, wouldn't that always just balance out i.e. input and output tax are always the same?
corford 12y ago
On the other hand, one of the nice things with using US services that bill in USD (apart from the current exchange rate benefit) is there's no VAT to pay. So, UK retail customers at least, get a 20% discount compared to using home grown offerings. Personally, I love being able to spin up Linode (and now DO) vms in London but pay USD prices.
- justincormack 12y ago
  There is VAT to pay and these companies are required to register for VAT and charge it I believe. Eg see http://webarchive.nationalarchives.gov.uk/20110202144320/http://customs.hmrc.gov.uk/channelsPortalWebApp/channelsPortalWebApp.portal?_nfpb=true&_pageLabel=pageLibrary_PublicNoticesAndInfoSheets&propertyType=document&columns=1&id=HMCE_CL_000922 http://webarchive.nationalarchives.gov.uk/20110202144320/htt...
  - corford 12y ago
    That doc is dated 2003 so I guess the regs have changed (and there have been some pretty major changes recently like CA2006 and FA2011). I certainly don't get VAT invoices from the US suppliers I use (linode and digital ocean for example). Edit: The 4th paragraph here seems to settle it: http://www.hmrc.gov.uk/manuals/vatpossmanual/vatposs14300.htm http://www.hmrc.gov.uk/manuals/vatpossmanual/vatposs14300.ht... The reverse charge mechanism places the burden for accounting for VAT on the recipient if the supplier is outside the UK.
    - artumi-richard 12y ago
      I have a more up-to date reference http://www.hmrc.gov.uk/vat/start/register/when-to-register.htm#3 http://www.hmrc.gov.uk/vat/start/register/when-to-register.h... I do get them from pingdom, and AWS. I do not get them from Mailchimp or hostgator.
      - corford 12y ago
        Could be because Pingdom is a Swedish company and AWS is Amazon, which has a presence in Europe?

raiyu 12y ago

At the moment all of our billing across all of our geographies is done in US dollars, which given the exchange rate of the UK and EU is usually within your favor. Is there a conversion charge that your credit card company levies on you for paying in US$?

drtse4 12y ago
Regardless of the company, there is always a conversion charge around 2% and the rate applied is never the actual rate, banks usually calculate a rate using some kind of moving average.
vertex-four 12y ago
My bank will charge £1.50 plus a variable commission for paying in anything but GBP.
- jordanthoms 12y ago
  Ouch. Seems credit cards out of the US are nowhere near as good, common there to have no foreign transaction fees (apart from probably some margin on the exchange rate).
  - fendale 12y ago
    If you shop around in the UK for a credit card, you will get one with zero fees and an excellent exchange rate on foreign currency transactions. I use the Halifax Clarity card and I believe The Nationwide and the Post Office do a good card too. I'd never use a Debit Card for foreign currency transactions though, they always seem to have fees involved.
    - Osmium 12y ago
      > I'd never use a Debit Card for foreign currency transactions though, they always seem to have fees involved. Nationwide used to have commission-free cash withdrawals on their debit cards abroad, but I think it was abused by people who had second homes in other countries so withdrawn a year or two ago. I believe they still offer a commission-free credit card though.
      - bryanlarsen 12y ago
        My impression was that the banks made a lot more money from the spread than they did from the commission, so I kind of find that surprising. In Canada it's easy to find commission-free cards. The spread is a hidden fee though, so the banks have hiked that up several times.
        gabemart 12y ago
        The commission-free withdrawals abroad were offered at the wholesale VISA rate. Nationwide didn't take any vig. Their "Select credit card" still offers EUR and USD purchases with no surcharge and no vig.
        fendale 12y ago
        I'm pretty sure the Halifax card I mentioned gives the Visa wholesale rate too. I generally get same rate as quoted on FX sites anytime I've checked it.
- kintamanimatt 12y ago
  Who's that? Halifax? They're great for everything else but non-GBP debit card transactions, and why I moved to HSBC and Co-Operative Bank. CaxtonFX are also really good for foreign currency cards (2% markup, which is lower than I get with any of my British banks) and have really good customer service too.
Gmo 12y ago
AFAIK, every bank (including for instance Paypal) charges a fee for conversion. At least, it's the case with my French and my Dutch bank. That's one of the great benefit of the Euro when shopping in the EU (well, except for our British friends :) ) Edit: corrected a typo
marcosscriven 12y ago
I'm not sure how the dollar price would be in my favour, if you've not specified what the GBP price would be? Sure, once you've set the price it could go either way. Anyway, as others have said, there are charges and spreads on foreign currency banking. It also adds complications to my otherwise very simple accounting needs.
justincormack 12y ago
Its not in our favour unless our exchange rate appreciates every month more than our fees. And yes we get charged just like you would if I charged euros to your card.
- jordanthoms 12y ago
  Most good US cards don't charge an extra fee for non-USD transactions.
  - kintamanimatt 12y ago
    They do, they just hide it in the applied exchange rate.
    - vamega 12y ago
      This is not true. All Mastercard and Visa cards charge a rate that is specified my Mastercard and Visa on a daily basis. I've been tracking this rate for a few months now, and it's consistently been awfully close to the rate I find on xe.com. The CARD Act of 2009 mandated that credit card issuing companies clearly describe the fees associated with foreign transactions. Visa/Mastercard charge a cross border origination fee of 0.80%. However many credit cards (all cards by Captial One for example) waive this fee, and do not charge any fee of their on on top of this.
petercooper 12y ago
I'm not speaking for Marco, but another issue with dollars is tax accounts (and especially VAT accounts) for British companies have to be in pounds, so there's overhead in doing the conversions, tracking the exchange losses/gains, etc. We also have to reverse charge the VAT on those transactions as well (though I'd be surprised if the majority of business owners know they have to do that). About 90% of my company's expenses are in dollars, so I've had to become proficient at dealing with it, but I imagine it's more annoying for companies who only make the occasional USD transaction, especially as they may have smalltime accountants unfamiliar with or unwilling to deal with the exchange rate stuff properly.
- corford 12y ago
  Can't you just use the monthly tables published by HMRC for the exchange rate (IIRC, packages like Xero do this automatically for you?). For the reverse charge, wouldn't that always just balance out i.e. input and output tax are always the same?

corford 12y ago

On the other hand, one of the nice things with using US services that bill in USD (apart from the current exchange rate benefit) is there's no VAT to pay. So, UK retail customers at least, get a 20% discount compared to using home grown offerings. Personally, I love being able to spin up Linode (and now DO) vms in London but pay USD prices.

justincormack 12y ago
There is VAT to pay and these companies are required to register for VAT and charge it I believe. Eg see http://webarchive.nationalarchives.gov.uk/20110202144320/http://customs.hmrc.gov.uk/channelsPortalWebApp/channelsPortalWebApp.portal?_nfpb=true&_pageLabel=pageLibrary_PublicNoticesAndInfoSheets&propertyType=document&columns=1&id=HMCE_CL_000922 http://webarchive.nationalarchives.gov.uk/20110202144320/htt...
- corford 12y ago
  That doc is dated 2003 so I guess the regs have changed (and there have been some pretty major changes recently like CA2006 and FA2011). I certainly don't get VAT invoices from the US suppliers I use (linode and digital ocean for example). Edit: The 4th paragraph here seems to settle it: http://www.hmrc.gov.uk/manuals/vatpossmanual/vatposs14300.htm http://www.hmrc.gov.uk/manuals/vatpossmanual/vatposs14300.ht... The reverse charge mechanism places the burden for accounting for VAT on the recipient if the supplier is outside the UK.
  - artumi-richard 12y ago
    I have a more up-to date reference http://www.hmrc.gov.uk/vat/start/register/when-to-register.htm#3 http://www.hmrc.gov.uk/vat/start/register/when-to-register.h... I do get them from pingdom, and AWS. I do not get them from Mailchimp or hostgator.
    - corford 12y ago
      Could be because Pingdom is a Swedish company and AWS is Amazon, which has a presence in Europe?