Invoicing Articles

Learn how Playroll sets exchange rates and applies an FX fee to manage currency fluctuations and payroll risk.

Playroll uses aggregated market exchange rates and applies a foreign exchange (FX) fee when billing and payment currencies differ. This article explains how rates are set, why they may differ from public spot rates, and why the FX fee is necessary for accurate, on-time international payroll.

Exchange Rate Methodology

Playroll does not rely on a single bank or official source for foreign exchange rates. Instead, we use an API that aggregates data from multiple reputable financial providers. This approach captures a rate that reflects broader market conditions rather than the pricing of one specific institution or platform.

The exchange rate is captured early in the morning on the day of invoicing. That rate is then applied consistently to all invoices generated on the same day, ensuring standardization and fairness across clients.

Because the rate is based on aggregated market data, it may differ slightly from the rate displayed on individual banking apps, currency converters, or public spot rate platforms. Publicly displayed rates often do not include operational or transaction-related costs.

This methodology is designed to provide a fair and representative market rate while maintaining consistency in invoicing.

Foreign Exchange (FX) Fee

Playroll charges a foreign exchange (FX) fee when the your billing currency differs from the currency used to pay employees. This fee covers the operational costs of currency conversion and helps manage the financial risks associated with foreign exchange volatility.

Why a Forex Fee Is Necessary

Exchange rates can fluctuate between the time payroll is calculated and the date employees are paid. Employees are paid based on the exchange rate applicable on the actual payment date and not the earlier rate from when payroll was initially calculated.

The FX fee helps buffer against exchange rate fluctuations between:

• The date the invoice is issued, and
• The date payment is processed and converted for payroll.

This structure ensures employees are paid accurately and on time, even if currency markets move between invoicing and payroll disbursement.

The fee is applied to the aggregated market rate. As a result, the final rate shown on your invoice may differ from publicly displayed spot rates, which typically exclude transaction, service, and risk management costs.

The cost calculator shows estimated employee costs. Final tax and contribution amounts are confirmed only after payroll is processed.

The amounts displayed on the Playroll platform’s Cost Calculator are estimates only. Final and accurate figures for employee taxes and statutory contributions are determined once payroll has been processed. Individual employee details may impact tax calculations and employer contributions, which can result in differences between the estimated and invoiced amounts.

How the Cost Calculator Works

The Cost Calculator is designed to provide an estimated monthly employment cost before onboarding an employee in a specific country or territory. It gives you an early projection of:

• Estimated employer taxes
• Estimated statutory contributions
• Projected total monthly employment cost

While the calculator aims to provide accurate projections, it does not account for every variable that may apply to an individual employee. Factors such as personal tax status, benefits, allowances, and local regulatory updates can affect final payroll calculations.

Why Final Amounts May Differ

The final invoice is generated based on actual payroll data processed for the employee. Variations may occur due to:

• Employee-specific tax profiles
• Changes in statutory rates or thresholds
• Adjustments, bonuses, or additional compensation
• Local compliance requirements

As a result, the total amount reflected on your invoice may differ from the original estimate shown in the calculator.

Key Takeaway

Use the Cost Calculator as a planning tool for budgeting and forecasting. For confirmed and final employment costs, always refer to the processed payroll and issued invoice.

This ensures clear expectations between estimated projections and final payroll outcomes.

The 'No VAT' label on our invoices indicates that no UK VAT is being charged. The reverse charge VAT was previously applicable but is no longer a requirement after the changes brought by Brexit. Therefore, Playroll no longer needs to include it on invoices.

The forex fee is an additional charge applied when currency conversion is required for payroll processing. This fee is outlined in your Master Service Agreement (MSA).

How the forex fee works

When your payment is converted from one currency to another, a forex conversion fee—typically 2.5%—is added. This may cause the final invoiced amount to appear higher than the original total.

Important: The forex fee is applied only to the Cost to Company portion of the employee’s compensation and is calculated monthly. It does not apply to Playroll’s EOR Fee or Contractor Fee.

This fee is stipulated in your MSA, which you can view directly in the Playroll platform under the Settings tab.

You can download a detailed invoice breakdown for any payroll month on the Playroll platform by following these steps:

Steps to access and download your invoice

1. Log in to the Playroll platform at https://app.playroll.com/.
2. From the dashboard, select Payments from the menu on the left-hand side.

3. Click on History from the dropdown list under Payments.

4. On the History page, locate the payroll month you’re interested in and click the three-dot icon to the right of it.

5. From the dropdown menu that appears, select the third option to automatically download the detailed invoice breakdown.

Invoices are issued on or around the 11th day of each month and must be paid within the payment terms stipulated in your Master Services Agreement to ensure timely salary payments to employees. Delayed invoice payments may result in late salary disbursements.

As Playroll does not pre finance the salaries and costs of employment it is critical that all invoices are settled within the agreed upon payment terms.

Adjustments may appear on your invoice due to the structure of Playroll’s monthly payroll cycle and our collaboration with international payroll providers. These adjustments are a result of deferred costs from the previous month that could not be included in real-time due to necessary approvals and processing timelines.

Why Adjustments Occur

Playroll operates on a rolling payroll cycle. Our cut-off date is the 10^th of each month, after which invoices are issued by the 11^th and finalized by the 15^th. However, payroll-related costs—such as employee benefits, last-minute changes, or cross-border contributions—may still be incurred after the cut-off. These are added as adjustments in the following month’s invoice.

This practice ensures accurate cost allocation while maintaining operational efficiency and cost optimization across regions. We avoid in-month changes to preserve consistency in your financial planning and reporting.

Operational and Audit Benefits

Our approach also supports better audit transparency. By keeping invoices consistent and allocating any changes to the following cycle, we create a clearer financial trail. This facilitates smoother audits, enhances regulatory compliance, and ensures that financial records accurately reflect your payroll activity.

Our Commitment to Transparency

Deferring adjustments helps both parties maintain consistent invoice tracking and eliminates the complexities of retroactive corrections. This strategy supports smoother operations, streamlined accounting, and better clarity in your monthly statements.

If an employee is added after the 10th of the month, they will not be paid in that same month. Their payroll will be processed the following month, and they will receive a prorated salary for their starting month together with the full salary for the next month.

Clients have until the 10th of each month to approve or adjust monthly payroll and expense amounts. After this deadline, Playroll issues the invoice around the 11th of the month. This will be available on the Playroll platform.