Look out!

The tax man wants to eat the fruit of your efforts.

You can legally avoid some UK taxes.

Income tax

 

Designed to tax income.

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Capital Gains Tax

 

Designed to tax the increase in real asset values plus the inflationary markup.

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Value Added Tax

 

Designed as a business-applied sales tax attaching from the top of the production and services chain to the consumer.

Some assets have favourable tax treatment.

They are 'privileged bullion'.

Britannia is a coin . She is looking at herself in a mirror.

Gold coins which are British legal tender

UK Minted Legal Tender Gold Coins

  • Examples: Sovereigns and Britannias.

  • Tax Status: Both CGT-free (as they're legal tender) and VAT-free (as they qualify as investment gold).

Note the collectable coin effect below. 

Gold Coins - Other UK Minted Gold Coins and Foreign Gold Coins

Other UK Minted Gold Coins and Foreign Gold Coins

  • VAT-free if they meet the "investment gold" criteria (i.e., minted after 1800, 900+ purity, and legal tender in their country of origin).

  • CGT applies to profits on these coins, as they're not UK legal tender. It applies when you sell or gift to someone other than your spouse or civil partner with whom you live during the tax year, or a charity.

  Note the collectable coin effect below. 

  Silver coins which are British legal tender

  • CGT-free: If they are UK legal tender, like certain Britannias or commemorative silver coins.

  • VAT - normally caught: Silver coins are not exempt from VAT, even when held in LMBA-approved bonded warehouses.

  • VAT - slightly caught: The VAT resale margin scheme applies to 2nd-hand sales by VAT-registered dealers. Under this scheme, the buyer only pays VAT on the dealer's margin when VAT was previously paid on the coins or they were exempt when previously sold. The scheme applies to other silver coins and silver rounds too.

Note  VAT is a national sales tax affecting items sold in the country. Purchasing coins offshore in a state with no sales tax or in a bonded warehouse in a nation that exempts sales of them in such warehouses are the two ways to avoid this. On this site, we introduce you to many international options, particularly those of Switzerland, Singapore, and the Cayman Islands. A UK dealer will be introduced to you for the Switzerland option, while offshore dealers will be introduced for the other options.

Collector  Gold Coins (Beyond Face Value)

    • CGT-free: If the coin is considered legal tender in the UK, even if its collectable value far exceeds its face value.

    • VAT is charged on sales and resales: When they are not classified as investment-grade metals.

    • Note: Coins worth more than 180% of their metal value are likely to be classed as collectable.

Allocated Bullion Vaulted Gold, Silver, Palladium & Platinum  bars stored in a bonded warehouses

LBMA-size bullion bars (big bars)  of gold and silver stored by LBMA members in bonded warehouses are not subject to VAT but gains are subject to CGT.  The same applies to platinum and palladium stored by LPPM members. The bonded warehouse system is called a ring and any sales of bars or fractions of bars without removing the metal is VAT free.

Investment-grade bars of gold are privileged

There is no VAT on these. The bar's dimensions are important because they need to meet industry standards. There are a number of these sizes.  The relief is for VAT, but CGT applies when you sell or gift to someone other than your spouse or civil partner with whom you live during the tax year, or a charity.

Note: Looking towards retirement, you can use the SSASs and SIPPs income tax concession systems to invest in precious metals in a tax-advantageous way.