An overseas property was bought in 2004. A deposit payment was made converting Sterling into Foreign Currency. Three months later the balance of the purchase price was paid converting Sterling into Foreign Currency. A mortgage for 50% of the purchase price was taken out and paid out to the mortgagee a month later. For CGT calculation purposes, do you use the FX rates at the various payment dates when Sterling was converted into Foreign Currency? Which FX rate do you use for the mortgage element? The date the mortgage was paid out to the mortgagee? Which FX rate do you use for the incidental acquisition costs- the date when they were actually paid (they were paid and converted from Sterling to Foreign Currency separately)?
The property was sold in 2019. The sale contract was signed in February. Proceeds were released by the conveyancer and local tax authorities in July and paid into the seller's Foreign Currency account. Proceeds were transferred to the UK, ie converted into Sterling in August. Which FX rate do you use for disposal proceeds? The date of the sale agreement (February)? The date of the proceeds deposit into Foreign Currency Account (July)? The date of the FX and transfer of proceeds to UK? What about incidental costs of sale, which had all been deducted from the proceeds paid into Foreign Currency account in July?