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V1417-22 16 June 2022 · SG de Tributación de las Operaciones Financieras Criterion in force
IRPF · rendimientos del capital mobiliario

Foreign currency bond interest converted at the official exchange rate on the due date

A taxpayer inquired how to determine the difference resulting from converting foreign currency bond interest into euros. The Directorate General for Taxes (DGT) ruled that such interest constitutes returns on movable capital and that the currency conversion process generates capital gains or losses.

The question raised

Determination of the difference generated by the conversion of the currency into euros.

The DGT's ruling

Interest from bonds in foreign currency constitutes income from movable capital, which must be converted into euros at the official exchange rate of the European Central Bank in effect on the date of its exigibility. The conversion of such currencies into euros generates capital gains or losses due to the difference between the transfer value (exchange rate at the time of conversion) and the acquisition value (exchange rate at the time of acquiring the currency or converting the interest). These variations are attributed at the time of effective conversion and are included in the savings tax base.

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