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HMRC customs exchange rates: which rate should you use?

The customs conversion rate and the rate you use to price a purchase are not always the same number.

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Customs valuation uses a prescribed conversion basis

For customs valuation, foreign-currency amounts that form part of customs value have to be converted to sterling on the basis HMRC requires. HMRC publishes monthly exchange rates for traders; those rates are published near the end of one month and generally apply for the following calendar month. Contractual fixed-rate situations and certain periodic declarations can require different treatment, so the declaration facts still matter.

Commercial costing can use a different rate

Your business may buy currency through a bank or broker at a different rate, hedge the purchase, pay card or transfer fees, or use an internal budgeting rate. That commercial rate matters to profit and cash flow. It does not automatically replace the customs conversion basis used on the declaration.

Keep two labels:

customs conversion rate for the declaration value and commercial conversion rate for what the purchase actually costs the business.

A clean currency workflow

  1. Record the invoice currency and foreign-currency amount.
  2. Identify the date/basis that applies to the customs declaration.
  3. Check HMRC’s current exchange-rate service and retain the rate/source used.
  4. Convert other customs-value elements shown in foreign currency on the same correct basis.
  5. Separately record the rate actually paid or budgeted for commercial margin analysis.

Do not overwrite the source invoice. Keep the original currency figures and the conversion working together so the declaration can be reconstructed later.

Worked example

Illustrative only: a supplier invoice is USD 12,000. If the applicable HMRC rate is 1.30 USD per £1, the sterling conversion for this simplified example is about £9,230.77 before other valuation additions. If your business actually buys the dollars at 1.27 after spread/fees, the commercial cash cost is about £9,448.82. Both numbers can be legitimate in their own context; mixing them creates reconciliation problems.

Common mistakes

  • Using today’s Google/market rate for a declaration without checking HMRC’s prescribed rate.
  • Converting the invoice but forgetting foreign-currency freight or insurance.
  • Using the customs rate as though it were the business’s actual FX cost.
  • Saving the GBP result without saving the foreign amount, rate, date and source.
  • Assuming one monthly rate applies where a contractual fixed-rate or other permitted basis changes the answer.

Build the customs value · Test the commercial margin

Official sources

LAST REVIEWED / 03 OCT 2026

Check the linked official source again before acting where rates, deadlines or guidance may have changed.