Sterling income conversion rates
As in previous years, local tax offices may suggest slight variations on suggested conversion rates
SOME readers have contacted Connexion with regard to the correct exchange rate to use for conversion of income received in UK pounds into euros in order to declare it.
This is because some tax offices have suggested rates differing slightly from our suggested one of £0.8493 to the euro for 2013 income to be declared this year (or €1.1775 to £1).
As previously stated in the Connexion newspaper and in our income tax forms helpguide, the official rule is to use the Banque de France rate on the day when the income was received by yourself. In practice, however, tax offices tolerate the use of an annual average rate.
Connexion made enquiries with the Banque de France and with the central tax authorities, who stated that a method for arriving at this average for this specific purpose is not set in stone. However, a valid method was stated to be taking an average of the monthly averages for the year in question (eg. 2013 for the declarations being made now).
Monthly averages (moyenne mensuelle) can be found on the website of the Banque de France under Economie et Statistiques > Changes et Taux.
We were told that there is some tolerance of slightly different rates if a “reasonable” method is used.
It is not therefore impossible that your local tax officials will have used a variant method and will suggest a slightly different rate. If that is the case it is likely to be simpler to accept the use of the one asked for, unless there appears to be a significant discrepancy, in which case you may wish to query how it was worked out.