HMRC Exchange Rates — How to Convert USD Trades to GBP Correctly

If you trade US stocks on Robinhood UK, Tastytrade, or any other platform that deals in US dollars, every single transaction needs converting to GBP for your tax return. And HMRC has specific rules about which exchange rate you use.

The official source

HMRC publishes monthly exchange rates on the Trade Tariff service. These are sometimes called “HMRC monthly rates” or “BMD rates” (Board of Management Direction).

The rates are expressed as foreign currency per £1. So if the January 2025 USD rate is 1.2707, that means £1 = $1.2707. To convert dollars to pounds:

GBP amount = USD amount ÷ rate

For example: $1,355 ÷ 1.2707 = £1,066.40

Which rate for which transaction?

Use the rate for the month the transaction occurred. A buy in January uses January’s rate. A sell in March uses March’s rate. Each leg of a trade converts independently.

This means you can have a gain in USD but a loss in GBP — or vice versa — if the exchange rate moved between your buy and sell dates. If you bought shares when the pound was weak (getting fewer dollars per pound) and sold when the pound was strong, your GBP proceeds are reduced.

Example:

A $500 (10%) USD gain becomes just £154 in GBP — because the pound strengthened between January and June. The FX movement ate most of the gain.

Can you use your broker’s exchange rate instead?

Some brokers (like Trading 212) give you GBP amounts directly — they convert at execution time using their own rate. In practice, using these broker-converted GBP figures is generally acceptable and consistent, though technically HMRC’s monthly rates are the official standard.

For Robinhood UK and Tastytrade, everything is in USD — you have no choice but to convert using HMRC rates. Don’t use Google’s exchange rate, XE.com, or your bank’s rate. Use the official HMRC monthly rate.

The HMRC exchange rates collection page provides rates for all major currencies, updated monthly.

FX gains on currency itself

There’s a subtlety that advanced investors should know about. If your broker holds a USD cash balance (Robinhood and Tastytrade both do), movements in that cash balance’s GBP value could technically create a chargeable gain. However, HMRC generally doesn’t pursue FX gains on “bank accounts in a foreign currency used for personal expenditure” under TCGA 1992 s.252.

For most retail investors, the FX conversion is handled at the individual trade level and the cash balance issue doesn’t arise in practice. But if you’re holding large USD balances for extended periods, it’s worth discussing with a tax adviser.

Fees in foreign currency

Broker fees denominated in USD also need converting. Commission of $0.50 per option contract becomes a GBP amount using the month’s HMRC rate. These converted fees are then added to your cost basis or deducted from proceeds as allowable costs.

The practical approach

Before running your CGT calculation, download the HMRC monthly rates for every month you had trades. TaxBull has a built-in rate entry screen — punch in each month’s rate, and every USD transaction is converted automatically. The rates are also available to auto-fetch from the Trade Tariff API.

Keep a copy of the rates you used as part of your tax records. If HMRC queries a conversion, you need to show which rate you applied and where it came from.

This is general information only. Exchange rate treatment can vary depending on circumstances. Consult a tax professional if you have complex foreign currency positions.