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Where Taxpayers and Advisers Meet

Exchange Rates

johnboy2020
Posts:1
Joined:Tue Dec 08, 2020 6:55 pm
Exchange Rates

Postby johnboy2020 » Tue Dec 08, 2020 7:06 pm

Hi,
I am trying to complete my self assessment capital gains tax section online.
I live and work in the UK for a US company.
I was given shares in US$ and sold them in US$ but need to enter both the cost of acquisition and the disposal value in £pounds.
Therefore i will need to apply an exchange rate.

I see that HMRC has official exchange rates:
Yearly Average
Spot Rates
Monthly average

What exchange rate should I use out of these 3? They vary so would i be able to use the one that gives me the best outcome?

Thanks

maths
Posts:8447
Joined:Wed Aug 06, 2008 3:25 pm

Re: Exchange Rates

Postby maths » Wed Dec 09, 2020 11:22 am

Spot rates on dates of disposal and acquisition.

TennisGod
Posts:8
Joined:Sat Oct 16, 2021 7:19 pm

Re: Exchange Rates

Postby TennisGod » Fri Oct 22, 2021 3:24 pm

So to be clear .... the spot rates published by HMRC are monthly averages

Do HMRC prefer / insist upon their use over say the the daily rates published by Bank of England

Maths - .....so you mean not "Spot rates on dates of disposal and acquisition." but "Spot rates for the months of disposal and acquisition."?

maths
Posts:8447
Joined:Wed Aug 06, 2008 3:25 pm

Re: Exchange Rates

Postby maths » Fri Oct 22, 2021 4:54 pm

Quote from HMRC manual:

"For example, if US shares are bought for US dollars in a bargain at arm’s length for full consideration

the acquisition cost of the shares is the sterling equivalent of the dollars given at the exchange rate in force at the date of acquisition of the shares;
the consideration for disposal of the dollars is the sterling value of the shares received in exchange."

TennisGod
Posts:8
Joined:Sat Oct 16, 2021 7:19 pm

Re: Exchange Rates

Postby TennisGod » Fri Oct 22, 2021 5:55 pm

Thank you. I got that.

I am trying to find the exchange rate to use

I gather it is not appropriate to use the actual rate at which my bank bought/sold £,$ and €

People seem to saying “the spot rate published by HMRC”. All I can find are monthly average figures used for “customs and VAT”

I am happy to use the daily rates published by Bank of England

I have also seen reference to OANDA - whatever that is


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