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V0104-14 20 January 2014 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · ganancias y pérdidas patrimoniales

Currency exchange in mortgage loans may result in capital gains or losses

A query was raised regarding whether currency exchange in a multi-currency mortgage loan triggers a tax obligation. The DGT ruled that any variation in the amount of debt in euros resulting from currency exchange constitutes a capital gain or loss.

The question raised

Whether the decrease in the loan principal resulting from the aforementioned currency exchange should be subject to taxation.

The DGT's ruling

If the transaction is not carried out within the scope of an economic activity, the change in denomination of a loan from yen to euro, or from yen to another foreign currency, results in a capital gain or loss. Said variation is quantified by the euro amount of the increase or reduction in the outstanding debt resulting from the currency exchange.

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