Exchange Rates Renta Tax Declarations

For future updates, pleas speak with your accountant.  Below is an explanation on how the rates are worked out:

• Tipo de cambio aplicable en la valoración de valores, cuentas y derechos: Deberás aplicar el tipo de cambio a 31 de diciembre publicado en el BOE en el año que corresponde declararlo. Posteriormente, deberás analizar cada año si debido a las variaciones en el tipo de cambio hubiese un incremento del saldo conjunto de todas las cuentas y derechos superior a 20.000,00 euros.

• Tipo de cambio aplicable en la valoración de un inmueble:El valor de adquisición informado, en caso de estar en una divisa distinta al euro, debe ajustarse al tipo de cambio vigente a 31 de diciembre del año en que informamos el bien por primera vez. No existe obligación de declarar en años venideros por el hecho que el importe inicialmente declarado fluctúa como consecuencia de los tipos de cambio.
• Exchange rate applicable in the valuation of securities, accounts and rights: You must apply the exchange rate as of December 31 published in the BOE in the year that corresponds to declare it. Subsequently, you must analyze each year if due to variations in the exchange rate there is an increase in the combined balance of all accounts and rights greater than 20,000.00 euros.
  Exchange rate applicable in the valuation of a property: The reported acquisition value, if it is in a currency other than the euro, must be adjusted to the exchange rate in effect on December 31 of the year in which we report the property for the first time. There is no obligation to declare in future years due to the fact that the amount initially declared fluctuates as a result of exchange rates.

For tax year 2121 so Renta declaration 2022

Reference rate Friday 31/12/2021 0.84028 or €1.19007 per £ sterling

Average rate Friday 31/12/2021 0.85960 or €1.16333 per £ sterling

Rate for Modelo 720 €1.19007 per £ sterling

For tax year 2020, so Renta declaration 2021

Reference date is Thursday 31st December. Reference rate was £0.89903 per £1 or €1.11230

Average rate for 2020 was £0.88970 or €1.123970

Rate for Modelo 720 is €1.11230 per £1 sterling

For tax year 2019, so RENTA declaration 2020

Reference date is Tuesday 31st December. Reference rate for the day was £0.85080 per €1 or €1.1753 per £1.sterling

Average rate for 2019 was £0.87777 or €1.13925 per £ sterling

Rate for Modelo 720 is €1.1753 per £1

For tax year 2018, so RENTA declaration 2019

Reference date is Monday 31st December. Reference rate for the day was £0.89453 per €1 or €1.1179 per £1.

Average rate for 2018 was £0.88471 or €1.1303 per £1.

Rate for Modelo 720 is €1.1179 per £1.

For taxyear 2017 so RENTA declaration 2018

Reference date is 29th December as the 31st was a Sunday. Reference rate for the day was £0.88723 per €1 or €1.1271 per £1. Average rate for 2017 was £0.87667 per €1 or €1.1407 per £1.

The rate to use for Modelo 720 is  €1.1271 per £1

For taxyear 2016, so RENTA declaration 2017
Reference date is 30th December as the 31st was a Saturday. Reference rate for the day was £0.85618 per €1 or €1.1680 per £1. Average rate for 2016 was £0.81948 per €1 or €1.2203 per £1.

The rate to use for Modelo 720 is  €1.1680 per £1.

For taxyear 2015, so RENTA declaration 2016
The exchange rate on the 31st December 2015 (British pounds to Euros) was €1.3625. The average rate for 2015 was €1.3777.

There is nothing in the tax legislation with regard to the exchange rate to be used in the income tax declaration, only the Modelo 720 ( €1.3625). If you receive euros already converted (e.g. state pension) then you could work out the rate you received, but it won’t be far out from the average rate, as this is based on the daily average throughout the year. Most people use the average rate if they receive sterling funds and then convert as and when required, although technically if you make an exchange profit then this is declarable.

Quite a lot of gestors use the average rate, but others use a different rate as evidenced above. I suspect that they use the same rate for all their clients, as this is the easiest for them.

Please note: The information provided is based upon our understanding of current legislation. It is not legal advice but is provided freely to enable you to be properly informed. We recommend that if you are considering taking action, you should seek professional advice.