VAT on Gold, Silver & Platinum Bullion

Gold, silver and other precious metals can maintain special positions in the market in relation to tax regimes. Like many tax topics, this is a complicated subject. It is especially complicated because different types of precious metal products are treated differently.

This article looks at two important questions which many investors who are new to Royal Mint Bullion ask -

  • Why do I pay VAT on silver, and in some cases, platinum - but not on gold?
  • When are my gold, silver and platinum bullion coins and bars subject to Capital Gains Tax?

Why do I pay Value Added Tax (VAT) on silver and platinum bullion?

Almost everything we buy in the UK is subject to VAT and there usually has to be a good reason for the Government not to add VAT to a product. Silver and platinum are no different. And gold used to be too, until very recently.

Before 1 January 2000 gold sales in the UK were subject to VAT. However, this changed because of the disparity between rules in the European Union. For example, some countries in the EU didn’t charge VAT on gold at all or charged it at a very low rate. This meant that the UK was at a disadvantage compared with other EU member states. The introduction of the exemption meant that for VAT purposes, gold would be treated the same as other investments, such as stocks and shares.

This did not alter the position of silver and platinum however and as such, VAT is added to the total of all sales of silver and platinum bullion (coins, bars and Signature).

Which Royal Mint Bullion products are free from VAT?

All gold bullion and gold coins sold by The Royal Mint are free from VAT, including (but not limited to):

Signature gold, is VAT free as is the case with all gold investment bullion. Signature silver and platinum however does incur VAT at the standard rate.

It is important to remember; Signature gold purchases are free from VAT on the original purchase only. Storage and management fees are still liable for VAT. The international ranges of gold bullion coins which are sold by The Royal Mint including The Krugerrand and Maple are also VAT free. Silver coins, regardless of the country of issue, are subject to VAT at the current rate of 20%.

Which Royal Mint Bullion products are free from Capital Gains Tax (CGT)?

All UK legal tender is free from CGT. Including (but not limited to):

What’s the difference between VAT and CGT?

VAT is the tax you pay on something you buy, which usually adds 20% to the price. But there is also a 5% VAT rate and a 0% rate.

CGT is the tax you pay on the profit you’ve made on an item when it’s sold. For example, if you bought a coin for £250 and sold it for £700, the CGT would be on the £450 you made from the sale. But you don’t have to pay CGT if all your gains in a year are under your tax-free allowance.

Customs and Import Duties – Tax on bullion

Any order may be assessed for import or customs fees, depending on the laws of the particular countries. Customers must comply with all laws and regulations of the destination country.

For orders dispatched to countries outside of the EU, VAT will not be charged. These packages may however be assessed for import or customs fees, depending on the laws of the particular countries. All invoices in respect of the products, services and storage or delivery (where applicable) for will be subject to VAT where applicable. VAT charges will be clearly shown where applicable.

Customs or import duties are levied once the package reaches the destination country. Additional charges for customs clearance must be paid by the recipient; we have no control over these charges and cannot predict what they may be. Customs policies vary widely from country to country and you should contact your local customs office for more information.

Please be advised The Royal Mint are not tax advisers and any information provided on in connection with the tax status of the Products is provided for general information only and should not be relied upon; in particular, the underlying tax legislation is always subject to change. You should obtain any specific advice from your tax advisers.