UK Bullion and its Tax Advantages

There is a big difference between Coins v Bars

Jesse Colombo

recently wrote an article that looked at numismatics and the advantages of owning such coins in the USA. That article and thought process is the headwind for this article about UK Bullion Coins and the tax advantages that you will have as a UK citizen.

Please be aware that the tax rules may change in the future and this information is correct at the time of writing. There is also an assumption that you are a UK Citizen looking to purchase UK Bullion.

If you are a foreign citizen then you might also have other tax advantages if you are looking to purchase UK Bullion but you are going to need to speak with your tax accountant/tax planning team in order to get clarity.

This article will also make the assumption that you are looking to buy bullion in order to take delivery of it. We will look at storage options in a later article.

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There are 2 well known names in UK Bullion and they are Britannias and Sovereigns.

Gold Britannias

Source: Sharps Pixley

A standard 1 oz Gold Britannia has a face value of £100. It is classed as ‘legal tender’ here in the UK and is thus Capital Gains Tax (CGT) exempt.

You can also purchase a half oz Britannia, a quarter oz or even a tenth oz Britannia. These are also CGT exempt.

Gold Britannias of any size are also Value Added Tax (VAT) exempt.

A standard 1 oz Silver Britannia has a face value of £2. It too is classed as ‘legal tender’ and is thus CGT exempt. You can also purchase larger 1kg Silver Britannias and these are also CGT exempt.

At the time of writing, if you are taking delivery of Silver in the UK then you will have to pay VAT of 20%. You are not liable to pay this if you are putting the bullion into storage but we will cover this in a different article and/or podcast episode.

Source: Sharps Pixley

Source: Bullion By Post

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UK Sovereigns

Gold Sovereigns are much older than Britannias.

Henry VII (also known as Henry Tudor and who ruled between 1485 – 1509) ordered the first striking of a gold sovereign coin in 1489.

It is a very recognisable coin and the Royal Mint started producing the coins that we recognise today, all the way back in 1817.

With hundreds of years of history, a gold sovereign is easily known around the world.

A Gold Sovereign has a nominal face value of £1 and contains 0.2354 troy oz of pure gold.

A Gold Sovereign is also classed as ‘legal tender’ and is thus CGT exempt.

A Gold Sovereign is also VAT exempt.

Silver Sovereigns also exist! That being said, the premium on them is (in my opinion) certainly not worth paying!

Source: London Mint Office

Now let us explore the differences between coins and bars.