The criteria for charging Value Added Tax (VAT) on precious metals here in the UK is both confusing and convoluted. In order to give you a better idea of how to purchase both gold and silver free from VAT, we thought we would lay out the current rules and regulations for you in our latest blog.
The differences between gold and silver
The first aspect you should be aware of if you’re thinking about investing in gold or silver is that the rules regarding VAT are not the same for both metals. Since the 1st January 2000, there is currently no VAT applicable for Investment grade gold. This includes gold bars with a purity of at least .995 thousandths and all gold coins that are 22 karats or higher. In order to qualify as an investment grade gold coin, the coin must have been minted after 1800 and also been legal tender in its country of origin. Examples of British investment grade coins include gold sovereigns and gold Britannia’s.
Silver, on the other hand, is subject to 20% VAT in the UK. In order for silver to qualify for VAT exemption, it must remain securely vaulted in an allocated vault outside of the EU. If you wish to withdraw your investment at any time, then you will be charged the standard VAT, regardless of the metals form or purity.
Storing your gold and silver
There are many reasons why you might want your gold and silver securely stored in an allocated vault. For example, you might not feel that you have anywhere secure enough to store your precious metals within your own house or you might be worried about the additional insurance costs that come with storing valuable goods in your home. Not to mention the possibility of additional risks such as theft or damage.
Silver stored in a bonded warehouse that’s situated outside of the European Union can also be bought and stored without the need to pay any VAT. This is why many precious metal dealers, ourselves included, offer secure storage in the channel-Islands as it doesn’t fall under the same tax regulations as the UK. Not only does this give you peace of mind that your investment is safe and protected, it also saves you the additional expense of moving the items, so you avoid those pesky insurance and delivery costs.
Storing your gold and silver with Physical Gold
We also offer investors the opportunity to store their gold and silver securely within one of our allocated vaults in the Channel Islands. Your investments will be fully insured and protected in the securest possible conditions and all of our vaults have multiple layers of security. For full storage costs, please click here or contact us on 020 7060 9992 for more information.
Image Sources: Wikipedia