Strategic Decisions for Precious Metal Purchases - 'Privileged Silver Coins' & Other Offshore Bullion

"Aurora, the celestial dance of lights in the polar skies, mirrors the radiance of precious metals like silver and gold. Silver, with its luminous sheen, captures and reflects light, symbolising brilliance and purity. Gold, with its warm and enduring glow, echoes timeless value and resilience. Together, they embody the celestial harmony of the aurora, a balance of radiance and strength that captivates the soul."

Helpful thoughts

Besides the cost and mechanics of investing, you need to keep in mind how later cashing in or otherwise exiting the investment can work out.  To get the most out of your investment, you need to carefully choose your dealer and storage location. You will likely want to avoid taxes where possible and to have some seller freedom.

Selling your Privileged Silver Coins  after being in Storage

When selling your silver bullion coins stored in a sales-tax-free offshore location, be it a zero-bonded warehouse or a country without applicable sales taxes,  it's important to maintain the tax advantages during the transaction.

Singapore

If your bullion is in Singapore,  you may note that there is no relevant tax.

With BullionStar, you can collect your coins and sell them to another dealer or anyone else if you are unhappy with the price BullionStar offers.

Switzerland

Switzerland applies VAT to bullion silver coins and bars unless they are in a bonded warehouse ring. If, after storage, the bullion is delivered to an address that is not a privileged transit destination  (between bonded warehouses by an LBMA member or equivalent), you will have to pay the VAT equivalent in tax on the current value of the bullion.

BullionByPost terms do not allow you to have your stored bullion delivered to a location other than the address associated with your account. They and the storage provider are parties to the storage agreement, and as a consequence, you do not have a free hand when selling.  BullionByPost will be in a strong bargaining position when you decide to sell, which may affect the price offered.

Chard gives you the option of having your stored bullion delivered elsewhere at an extra cost. This does not enable you to have a free hand in selling while preserving the tax-free status of the bullion since you have no direct contractual connection with the storage company.  A delivery to your home would mean a VAT equivalent rate would be payable. The logical choice would be to sell back to Chard. They will be in a strong bargaining position, which may affect the price offered. 

GoldBroker.com gives you the flexibility of having a direct contract with the storage provider. You could sell to GoldBroker.com, a local dealer, or anyone else without removing the bullion, which would keep its avoidance status with mutual benefit. In the alternative, if you wanted to remove the bullion from storage, then an equivalent of the VAT would be the tax payable. Switzerland has a VAT rate of 8.1%, so if you took them out of storage in Switzerland but they remained in Switzerland, then that would be the exit tax. The EU is a VAT zone.

The Cayman Islands

If your bullion is in the Cayman Islands,  you may note that there is no relevant tax.

SWP is well worth considering. The terms under which SWP operates—they will ship where you want or you can collect—give you freedom when selling. You can expect a fair offer from them, but you can sell elsewhere. There are dealers in the British Virgin Islands, which are a direct flight away, and transport would be logistically simple. Transfers between bonded warehouses are straightforward.

Other Offshore Bullion

Bullion gold bars and coins in Switzerland are 'investment gold,' and VAT is not applied to sales.  Bullion silver bars are treated in Switzerland in the same way as the coins: VAT is levied on sales except for bars in the bonded warehouses.

Singapore and the Cayman Islands have no relevant taxes on such bullion.

Your seller freedom, or lack of it, after storage is the same as mentioned above, and as noted, it varies from one company and location to another.

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