Answers · UK 2025/26
Are foreign currency bank account gains subject to UK CGT?
Yes. Gains from holding foreign currency in bank accounts are subject to CGT in the UK, with the £3,000 annual exempt amount applying.
Full answer
HMRC treats foreign currency as an asset for CGT purposes. When you convert foreign currency back to sterling (or use it to pay for goods or services), you may have made a capital gain or loss based on the exchange rate movement. For example, if you bought USD 10,000 when £1 = $1.25, your cost base is £8,000. If you later spend it when £1 = $1.15, the proceeds are £8,696, giving a gain of £696. However, a personal sterling bank account is exempt from CGT (although it earns interest that is taxable). Foreign currency held for purely private purposes (holiday money, personal spending) is exempt under HMRC practice if the amount is not large. The £3,000 CGT annual exempt amount applies.
This answer is informational only and does not constitute financial, tax or legal advice. Figures are for the 2025/26 UK tax year. See our methodology and sources.