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HMRC internal manual

Capital Gains Manual

HM Revenue & Customs
, see all updates

Foreign currency: introduction

Currency other than sterling is a chargeable asset and its disposal can give rise to a chargeable gain or an allowable loss. Foreign currency bank accounts can also give rise to chargeable gains or allowable losses for periods up to 5 April 2012, see CG78320+.

Exemption is available to individuals in respect of currency representing currency acquired for personal expenditure outside the United Kingdom, see CG78315.

Often currency will be acquired and/or disposed of in the course of a transaction involving other chargeable assets, for example, on the sale of shares for foreign currency. It is important to recognise the currency as a chargeable asset in its own right and to deal with it accordingly, see CG78310 - CG78314.

NOTE: The instructions in this section do not apply to currency held by companies within the foreign exchange gains and losses (FOREX) legislation. This applies for accounting periods beginning on or after 23 March 1995. For an outline of the FOREX rules see CG44000.