Talk Quesada forum

Does any one know what euro conversion rate for 2016 is being used for Residencia Tax

average for income tax 2016 1.224833

This is a really and seriously interesting question ... i.e if one is tax resident, but with income coming eg monthly from the UK in Sterling at a time of considerable currency volatility, what is correctly the amount to be declared? On the date of the transfer and the rate prevailing on that day ? ( Which would seem fair ) or is there a regulation eg that it must be the rate on 31 December at tax year end ( which could work out in your favour, or against you , depending on the currency fluctuations. Would be very interested in comments from people with real experience of this, and real experience of the requirement as they make their tax return... or what their solicitor/fiscal rep advised them...

1. There is no conversion rate mentioned in the tax regulations in Spain. OK, the Brits are probably the biggest group but there are plenty of other nationalities with different currencies.
2. The person who does the tax return will have a standard and apply that to all their customers. Some use the rate at 31 December, some use an average throughout the year and others the prevailing rate on each month. It would be a nightmare for them to work out the rate when every individual actually got paid. Rates vary day by day and even on the day the money comes in. Which would they use, the 1.14 at 0800 in the morning or the 1.16 at 1400 the same day? No, they have to have a rate which applies to make any sense out of it.

So there is no actual regulation laid down. If you do your return yourself then pick the most advantageous. If you have a fiscal rep let them do the calculation for you. Unless you have a huge amount coming in I would imagine the difference is quite negligible.

The tax authority give a rate for yearly calculations, it is one number for use across the yearly return.