Your most frequently asked questions, answered.
1.About Physical Gold Ltd (PGL)Can PGL offer me financial advice?
No, we cannot provide you with actual financial advice. However we can make you aware of the most tax efficient ways of buying physical gold in the UK and share our market expertise – to guide you towards the best value gold and most balanced portfolio of gold. We can also recommend an Independent Financial Adviser (IFA) if you’d prefer to seek separate advice.
Commodities only become regulated by the Financial Services Authority (FSA) once they are secured. Therefore buying physical gold falls outside of the FSA. The tax rules affecting gold, including the VAT exemption, Capital Gains Tax, and qualification for UK pensions are governed by HMRC. PGL are a proud member of the British Numismatic Trade Association (BNTA), so are also obliged to operate within their strict rule of ethics.
Absolutely! We are a member of the BNTA, the leading trade association for gold coin dealers, the National Association for Pension Funds (NAPF), and the Institute for Financial Planners (IFP).
We are partners with around 25 leading UK pension providers, and work with a whole network of IFAs, who have all carried out strict due diligence on us.
Where are your offices?
We are based in the city of London, in the old Nat West tower.
Our full address is;
Tower 42, 7th floor
25 Old Broad Street
London EC2N 1HN
2.Buying ProcessDo I need to provide you with identification?
We have joined the Government’s anti-money laundering scheme, which means we need to adhere to its ID requirements. If you purchase £5,000 or more in one transaction or make several purchases totaling over £10,000 in one year, then we will need two forms of ID. One needs to be a picture (passport/driving license), the other a recent proof of address (3mth or less utility/bank bill). We need either originals or certified copies. Photocopies can be certified by the following people; GP, Accountant, Civil Servant, Teacher, Solicitor, Notary, Employer or at a minimal charge – a post office worker. If your investment is smaller than these amounts, we do not require any ID.
We accept either bank transfers or cheques. Internet or bank transfers will secure the price of your gold or silver immediately. A cheque will lock in the price on the day the funds clear. Unfortunately we cannot accept debit or credit cards – to protect ourselves from fraud and to avoid the high transaction charges. Our margins are very low and we want to reduce any associated charges so as to obtain the most gold for your money.
There is currently no VAT to pay when purchasing investment gold in the UK. The official HMRC exemption applies to all gold or purity 22 karat or higher in the form of a coin or bar. With the VAT rate set to rise to 20%, this represents a great saving over silver and platinum which are taxable. Do you charge any commission on the transaction?
We do not charge any commission or management fees. We make our money by buying gold at wholesale levels and selling on to retail. There is, of course, a margin between where we buy and sell. To reflect this simple process, we pass on discounts to you according to how much you buy.
There is VAT applicable to silver purchases should you choose to receive your metals within the UK. However a vast majority of our silver investors opt for us to storage the silver in the Channel Islands and pay no VAT on their purchase at all.
You are always best to go back first to the place where you bought the precious metals. Around 95% of our customers who ask for a sell-back price, end up using ourselves – as we are very much buyers as well as sellers of gold and silver. After all, we know the source of the coins/bars we sold you and top quality investment gold and silver is in shortage. In fact we offer a BUYBACK GUARANTEE with all the gold and silver we sell, meaning that we will always buy back the metals at market rate. The great thing about the coins and bars we sell is that it is always globally-renowned ‘liquid’ gold and silver – so you can always obtain a few quotes when it comes to sell.
You will need to complete a metals release form if you wish to sell coins or bars which we are storing for you. This is because when we store gold and silver on your behalf, you remain the legal owner, so your signature is required for us to move your allocation.
You will complete an Investment Instruction to place your order including all our terms & conditions which act as a legal guarantee that we will deliver the gold or silver (or store it), verifies the price, type of gold, condition and authenticity. An invoice is also sent with all transactions.
3.Form of InvestmentHow do I know if to buy gold within a pension or with liquid cash?
There are advantages of both methods. The main advantage of investing outside of a pension is your ability to sell the gold and realise your profits whenever you need. With a pension, you can sell the gold at any point, but the proceeds will generally need to remain in the pension funds until retirement age.
The huge benefit of pension gold is the discount of up to 50% you can receive through tax relief. Your decision will be based on personal circumstances and you may decide to seek guidance from an IFA. Many customers decide that variety is the best way to invest and put some gold into their pension, and keep some liquid.
If you like the idea of protecting yourself with gold investment but have little upfront cash to invest, then our Gold Savings may be a good option. This is a simple way to save regularly from as little as £250/month or £1,000/quarter, and you will gradually accumulate a holding of physical gold. The other advantage is that you can benefit from averaging the cost of the gold over time, and you don’t have to worry about making individual payments every month or quarter.
We are happy to help you invest in just one coin or from £250/month with our Gold Savings. Investments into a Self Invested Personal Pension (Sipp) will be subject to suitability issues. As a guide, a minimum of £10,000 is recommended to offset any costs associated with setting up a Sipp. A minimum starting investment of £5,000 applies to silver purchases.
No. Only a Self Invested Personal Pension (Sipp) can house gold bullion. Company pensions, stakeholder and personal pensions can generally only house traditional paper assets. Sipps are designed to house those assets, along with the qualifying alternatives such as gold and property.
Only gold bars of minimum purity 995 parts gold per thousand qualifies for your pension. Gold coins to not qualify.
Silver does not qualify for your Sipp.
We have partnered up with a selection of Sipp providers who all specialise in enabling alternative assets into their pensions. They will help you decide if a Sipp is suitable for you, and facilitate the necessary paperwork. You will need an Independent Financial Advisor (IFA) to rubber stamp your Sipp gold purchase. We can introduce you to IFAs if you don’t already have one.
The choice is yours. You can leave your current pension where it is, and open a Sipp alongside this to house gold (and other assets). Alternatively, if you like the idea of all your pension assets under one roof, we can help you transfer your existing pension into a Sipp.
4. Types of gold and silverHow do I know the precious metals you sell me are genuine?
Always buy from a reputable dealer, and avoid auction sites! Most coins and bars do not come with certification, but all our gold and silver is checked by our numismatic experts. As members of the British Numismatic Trade Association (BNTA) we have to adhere to a strict code of ethics and would be thrown out of the association if we ever handled fake coins or bars.
All precious metals prices are based on the spot price for that metal in Sterling. This rate is only available to large banks trading in huge London Good Delivery Bars and does not include any brokerage fees, transportation, storage or insurance. Smaller bars and coins are always sold at a premium to the London spot price to reflect the additional costs of producing and testing smaller items. The value of coins may also be increased through their scarcity, design, historical value, collector’s value, and general market demand. Our premiums are extremely competitive and reduce as you buy larger bars or higher quantities of coins. Our consultants will be able to provide prices based on the live spot market.
Each buyer’s circumstances are different and therefore the best type of gold to buy will vary from person to person. Our consultants are experienced at helping select the optimum combination to maximise returns and suit your requirements. We will consider factors such as possible bulk discounts, flexibility when selling, tax issues, liquidity, current premiums and reason for purchase (collection, investment, meltdown for jewellery).
Again, our consultants will help determine the best type of coin to suit your needs. Premiums can fluctuate on various types of coin, so sometimes older coins offer better value. Our market expertise will help you select the coins with the best value and potential.
All investment grade gold, including bullion coins are VAT exempt to buy. UK coins of the realm are also free of Capital Gains tax (tax on your profits when you sell an asset) as they are legal tender. Qualifying coins amongst others are Britannias, Sovereigns, Angels and the gold £5 and £2 coins, along with their fractional versions. Silver Britannias also benefit from being CGT free.
5.Storage/DeliveryWhen will I receive the gold?
Your gold is shipped to you within 1 week of funds clearing, but most often within 1-2 business days. We will always be upfront if a certain bar or coin will take longer to source. Is it possible to pick up the gold from your offices?
Due to security and insurance reasons, we are not permitted to allow the public access to our offices and therefore do not have retail premises. By far the safest and most secure method of receiving your gold is through our delivery service which is fully insured and recorded.
All our postage charges include full insurance and secure recorded delivery. Our charges for insured delivery are as follows
Gold Savings £6
For purchases between £1 – £10,000 £8
Transactions between £10,001 – £50,000 £15
Transactions between £50,001 – £100,000 £25
Transactions between £100,001 – £200,000 £50
Transactions between £200,001+ £100
Can you ship gold outside of the UK?
Yes, we can deliver gold around the world. Please ask our consultants for a bespoke price.
Yes, we can deliver gold to any address, provided there is someone to sign and receive it. Once the delivery has been signed for, it is no longer under PGL’s insurance or responsibility.
We are able to offer storage for gold with Via Mat International in the UK. They are one of the world’s leading precious metals storage facilities with warehouses around the globe. They are a member of the British Security Industry Association (BSIA), and the London Bullion Market Association (LBMA). http://www.viamat.com
Silver is stored within the vaults of Network Securities Ltd in The Channel Islands who is registered with the Guernsey Financial Services Commission (“GFSC”) and supervised for compliance in line with the Handbook for Financial Services Business on Countering Financial Crime and Terrorist Financing issued by the GFSC.
Absolutely. Your holding is fully covered through Lloyds of London.
Charges are 1% per annum + VAT, paid upfront 6 months at a time for gold, and 1.5% for silver.
The lowest value we are able to store is £5k of gold or silver.
The gold and silver is legally owned by yourself and you can choose to collect the metals if desired. You will be provided with a legal Storage Agreement stating the amount and type of coins/bars stored, and the location it is kept. We operate on a fully allocated and segregated manner, meaning you have actual coins or bars in your name which don’t sit on Physical Gold Ltd’s balance sheet or that of the storage facilities. So your gold and silver is fully protected and counterparty risk FREE.
6.Gold MarketIs physical gold a risky asset?
All investments involve a degree of risk, and gold is no exception. Just like stocks and shares, the value of gold can go down as well as up. We would never suggest borrowing money to invest into physical gold, or putting all your money into gold. The key with any portfolio is having a mix of assets. The great news with physical gold is that it provides a unique portfolio balance as it is not correlated with other assets. This benefit has become very apparent recently when the value of shares, bonds, cash and property have all fallen at the same time, while gold prices have continued to rise.
While gold still has a degree of market risk, buying physical gold cancels out any counterparty risk. This means that unlike paper assets, the value of gold can never fall to zero if a Government, company or person goes bankrupt. As a globally recognised and traded commodity, the liquidity risk of gold coins and bars (or difficulty in selling) is minimal.
Clearly in an ideal world, you buy an asset at its lowest price point, and sell at its highest. Gold has returned an average of over 20% per year in the UK over the past decade. However, we feel the very factors which have pushed gold to its current level are stronger than ever. We have the backdrop of record Government debt around the world, European nations struggling to pay their way – suggesting a possible collapse of the Euro, a UK coalition Government for the first time since 1945, and the very real threat of high inflation around the corner. As a finite, precious metal with little significant supply due over the next 7-10 years, market factors still very much favour its continued rise over the medium term. The fact that the gold price has adjusted downwards recently, means it’s an ideal time to buy the very same gold at a reduced price. Gold investment should always be viewed as a medium to long-term asset to maximise possible returns.
Electronic Traded Funds will track the spot price of gold and can be useful for speculation. However, you are never actually purchasing the bullion, and your shares can never be redeemed for physical gold. There are other risks involved with ETFs that include lack of transparency and accountability. Several recent press articles have highlighted that for the amount of shares issued through gold ETFs, there is not enough bullion to back them up – leaving a huge liquidity issue if many investors wished to cash in at the same time. This reason, combined with their complicated risk disclosures, means your assets are at risk when you need them most and this would undermine the very reason for owning gold as a crisis hedge in the first place. Owning physical gold bars or coins, even if stored by ourselves on your behalf, presents no counterparty risk whatsoever. This is because all the gold we store for you is fully allocated and segregated. Owning physical gold itself, is undeniably the ultimate way of owning a safe haven asset.
Both methods of gold exposure represent entirely different asset classes and risk/reward attributes, especially in times of economic turmoil. Whilst mining stocks can generate substantial returns, they do not outperform physical gold in times of financial crisis. Not only that, but the investor can be exposed to just a single mining company and their fortunes. If that company goes bankrupt, the entire value of the shares can be wiped out. Physical bullion can never fall to zero. In times of sharp market decline, mining stocks tend to become correlated to the broad equity markets and suffer accordingly.