I bought in pesetas or in another currency: how is it converted?

Beat Zürcher is a retired architect in Basel. In 1999 he bought a villa in Frigiliana for 18,500,000 pesetas, and paid another 1,350,000 pesetas in tax, notary and land registry fees. In 2013 he built a swimming pool with a Swiss firm, which invoiced him 20,000 francs. Now, in 2026, he is selling for 285,000 €. When preparing the sale he realises that he has figures in three currencies and does not know how to put them together. He is also surprised that nobody adjusts a purchase made twenty-seven years ago for inflation.

Everything is calculated in euros, each amount at its own rate

The gain taxed by Spanish non-resident income tax (IRNR) is a gain in euros. Article 35 of the IRPF Law (Spanish personal income tax), which applies through article 24.4 of the IRNR Law, compares the transfer value with the acquisition value, and both have to be expressed in the same currency. The logic of the system leads to converting each amount at the exchange rate for its own date, not at a single rate nor at the rate on the day of sale.

For pesetas there is a closed answer: the irrevocable conversion rate fixed when the euro was introduced, 166.386 pesetas to the euro. There is no need to look up the 1999 rate: every figure in pesetas is divided by that number.

For other currencies, such as the francs for the pool, you use the exchange rate on the date of payment. The most usual reference, and the easiest to document, is the rate published by the European Central Bank for that day. The rate the bank applied to the transfer can also serve if it is backed by evidence.

Beat's figures

1. Purchase price in 1999: 18,500,000 pesetas.
2. Purchase costs: 1,350,000 pesetas.
3. Total: 19,850,000 pesetas / 166.386 = 119,300.90 €.
4. Pool in 2013: 20,000 CHF. Assuming a rate of 0.81 € to the franc on the date of payment, which is an example figure: 16,200 €.
5. Acquisition value: 119,300.90 + 16,200 = 135,500.90 €.
6. Transfer value: 285,000 − 8,550 of estate agent's fees = 276,450 €.
7. Gain: 276,450 − 135,500.90 = 140,949.10 €.
8. Tax at 19 %: 26,780.33 €.
9. The buyer's withholding, 3 % of 285,000: 8,550 €.
10. To pay with the Modelo 210 (the non-resident's tax return): 18,230.33 €.

The pool is an improvement: it adds something that did not exist. That is why it adds. Had it been a repair to an existing pool, it would not, as explained in I renovated the flat: does that add to the purchase value?.

Why there is no adjustment for inflation

Until 2014, the law allowed updating coefficients to be applied to the acquisition value of property, which partly corrected the effect of inflation. Law 26/2014 rewrote article 35 of the IRPF Law with effect from 1 January 2015, and the current wording no longer provides for them. As non-residents calculate the gain under those same rules, they do not apply them either.

For Beat, this means that 27 years of general price rises are taxed as if they were real gain. It is a harsh consequence of the rule, not a calculation error.

There is a different regime that should not be confused with this: the reducing coefficients of the ninth transitional provision of the IRPF Law, which relate to assets acquired before 31 December 1994. Beat's purchase is from 1999, so it falls outside. If your purchase is earlier than 1995, it deserves separate study.

Item	Original currency	How it is converted
Purchase before 2002	Pesetas	Dividing by 166.386
Purchase costs in pesetas	Pesetas	The same, at the same fixed rate
Improvement paid in foreign currency	Francs, pounds, dollars…	At the rate on the date of payment
Sale price	Euros	No conversion
3 % withholding	Euros	No conversion

Which paperwork stands up to a check

With old purchases, the problem is usually not the conversion but finding the papers. For a purchase in pesetas you should have:

• The deed of purchase, which records the price in pesetas. If it cannot be found, a copy can be requested from the notary, or an extract from the land registry.
• Proof of the tax paid at the time. The regional authorities or the notary may keep a copy.
• The notary and land registry invoices from the time. If they are missing, the prudent course is to leave them out rather than estimate them.

For improvements paid in another currency:

• The original invoice, in its currency.
• The bank statement showing the payment and the date.
• The reference for the exchange rate applied.
• If the work required a municipal licence, the licence and its fees, which add to the cost in euros.

If you have an old purchase or payments in another currency, you can send us the documents through the property sale form and we will do the conversion with support for each figure.

The currency gain or loss in your own country

Beat is going to change the euros from the sale into francs. If the franc has risen against the euro since 1999, in francs his gain may be smaller than in euros, or not exist at all. That changes nothing in Spain: the Spanish gain is calculated in euros. How Switzerland treats the operation, and whether it recognises the tax paid in Spain, is a question of Swiss law that Beat's adviser there has to confirm. We do not give an opinion on it.

Other situations involving foreign currency

• The purchase was paid with a mortgage in another currency. The mortgage is financing, not price. The acquisition value is the price in euros or pesetas stated in the deed, and interest never adds.
• The price in the deed was set in another currency. It is rare, but it happens. It is converted at the rate on the date of the deed.
• The property was inherited. The acquisition value is the Inheritance Tax value, already expressed in euros or pesetas. We deal with it in I am selling a flat I inherited.

The other items that add to the purchase value, whatever the currency, are in which costs can I add to the purchase value. And if the villa was let in any year, depreciation will also have to be subtracted; we explain it in I let the flat: does that count against me when I sell?. The guide working out the gain when you sell brings all the pieces together.

When the deed does not reflect everything that was paid

With old purchases it is not unusual for the price actually paid to have been higher than the one in the deed. For the purposes of the sale, what can be proved as the acquisition value is what appears in the deed and in the proof of payment. Claiming a higher price now without documentary support does not usually succeed and may open awkward questions about the original transaction. If there are provable payments not shown in the deed, such as a bank transfer to the seller for the same purpose, the matter deserves specific analysis before including them. In no case is it advisable to rebuild the price from memory.

Rebuilding the purchase value of old properties, or of those paid for in other currencies, is part of the Salama Tax service for non-residents selling a property.