I have Ltd company in the UK that is registered to VAT and its reporting and functional currency is in USD. I tried to file the VAT returns but HMRC told me that i have to file in GBP. How do i go about it?
You can only file GBP VAT returns. However there are a number of options available for a company who has foreign currency VAT transactions. These are:
– Use HMRC foreign currency rates. HMRC publishes foreign exchange rates for over 120 countries and currency zones. The data is based on daily figures published in the Financial Times. There is sometimes a wide discrepancy with market rates.
– You can use exchange rates published each day from a recognised source – e.g. aOANDA
– You can write to HMRC to try and get permission to use the method that your accounting package uses as default.