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Property sale in foreign currency instalments.
A client sold an apartment in Hungary in March 2018 and payment was made by instalments between then and June. We have used the exchange rate between sterling and the Hungarian forint on the date contracts were exchanged to work out the sale proceeds in British pounds. However it would probably be beneficial for the client if instead we could use the rates on the dates the instalments were paid.
On reflection we think that we must use the rate at the exchange of contracts but should be grateful if Taxation readers could confirm that this is the correct approach. Further if the exchange rate changes between sale and payment can this be taken into account? Finally if the instalments had been paid over a longer period could we have deferred payment of the tax?
Query 19 241– Borbála.
