is gold tax free in the UK - uk bullion by post

Introduction: Understanding Gold Taxation in the UK ( is gold tax free in the UK )

Gold has long been a favorite investment choice for UK residents looking to preserve wealth, hedge against inflation, or diversify portfolios. However, one of the most common questions new and experienced investors alike ask is: “Is gold tax-free in the UK?”

In this comprehensive 2025 guide, we will explain:

Whether gold is subject to VAT (Value Added Tax)
How Capital Gains Tax (CGT) applies to gold
What kinds of gold are tax–free (coins vs. bars)
Common mistakes UK investors make
Practical tips to legally minimise taxes on gold investments

If you’re planning to invest in physical gold—whether coins, bars, or rounds—understanding the UK tax implications is essential. Let’s break it down.

Quick Answer: Is Gold Tax-Free in the UK ( is gold tax free in the UK)?

VAT: Yes, most investment-grade gold is VAT-exempt in the UK.
Capital Gains Tax (CGT): Only certain gold coins are CGT-exempt, such as Britannias and Sovereigns.

So gold can be tax-free, but it depends on the form of gold and how you buy or sell it.

What Is VAT and How Does It Apply to Gold?

VAT (Value Added Tax) is a consumption tax applied to goods and services. In the UK, the standard rate is 20%. However, gold has special tax treatment.

✅ VAT on Investment Gold

According to HMRC Notice 701/21:

“Investment gold is exempt from VAT.”

To qualify as investment gold:

Gold bars or wafers of at least 995.0 purity
Gold coins that are:
- Minted after 1800
- At least 900.0 purity
- Legal tender in their country of origin
- Not sold at more than 180% of the gold market value

Examples of VAT-exempt coins:

Gold Britannias
Gold Sovereigns
Krugerrands
Maple Leafs

❌ VAT on Non-Investment Gold

You may pay VAT if:

You’re buying collectible or numismatic coins above the 180% threshold
You’re buying gold jewelry or watches
You’re purchasing gold from an unregistered dealer who incorrectly charges VAT

Tip: Always buy from HMRC-registered dealers who specify VAT-exempt status.

Capital Gains Tax (CGT) on Gold in the UK

What Is CGT?

Capital Gains Tax is a tax on the profit made when selling or disposing of an asset that has increased in value. For individuals in 2025:

Annual CGT allowance: £3,000
CGT rate on most assets: 10–20% depending on income bracket

How It Applies to Gold

If your gold investment increases in value and you sell it, you may owe CGT—unless the gold is exempt.

✅ CGT-Free Gold

Gold Britannia Coins (1oz, ½oz, ¼oz, 1/10oz)
Gold Sovereigns These are considered legal tender in the UK, so any gains are exempt from CGT.

❌ Gold Bars and Foreign Coins

Gold bars are not legal tender
Foreign coins (e.g., American Eagles, Austrian Philharmonics) may not be CGT-exempt

So if you sell a £50,000 gold bar at a profit of £10,000, you may owe tax—unlike with Britannias or Sovereigns.

Tax-Free Gold Options for UK Investors

1. Gold Britannia Coins

999.9 purity
Legal tender (£100 face value)
VAT-free and CGT-exempt
Widely recognized and easy to sell

2. Gold Sovereign Coins

22 carat gold (91.67%)
Legal tender (£1 face value)
VAT-free and CGT-exempt
Popular historical appeal

3. Krugerrands & Other Coins

VAT-free (if investment grade)
Not CGT-exempt

4. Gold Bars

VAT-free if 995.0 purity or higher
Subject to CGT on capital gains
More compact for high-value storage

Real-World Examples: UK Gold Investment Taxation

Example 1: Buying a Gold Britannia Coin

Purchase price: £1,850
Sale price (2 years later): £2,200
Profit: £350
Tax due: £0 (CGT-exempt)

Example 2: Buying a 1kg Gold Bar

Purchase price: £60,000
Sale price: £70,000
Profit: £10,000
Annual CGT allowance: £3,000
Taxable gain: £7,000
If in 20% CGT bracket: £1,400 owed

How to Avoid or Reduce Taxes on Gold in the UK

✅ Buy Legal Tender UK Coins

Stick to CGT-exempt coins like Gold Britannias and Sovereigns to avoid capital gains tax.

✅ Store Receipts and Documentation

Keep a record of purchase dates, prices, and dealer information to report gains or claim exemptions.

✅ Use Your CGT Allowance

If selling taxable gold (e.g., bars), structure your sales below the annual CGT threshold of £3,000.

✅ Use Spouse’s CGT Allowance

Married couples can each use their allowance—potentially exempting up to £6,000 in gains.

✅ Consider Bonded Storage for Silver

While silver is VAT-applicable, storing it in bonded warehouses may defer VAT until withdrawal.

Common Misconceptions About UK Gold Taxation

❌ “All gold is tax-free.”

Only specific forms of gold are VAT-free and/or CGT-exempt.

❌ “Buying from abroad avoids UK tax.”

Wrong. You’re still subject to UK import VAT and potential customs charges.

❌ “Bars are better than coins for tax.”

In fact, coins like Britannias are better due to CGT exemption.

❌ “Numismatic coins are always tax-free.”

They may not qualify as investment gold if priced above 180% of metal value.

Why UK Investors Prefer CGT-Free Gold Coins

Legal tender status avoids reporting capital gains
Easier to liquidate in small increments
Can be gifted to family members tax-efficiently
Compatible with inheritance planning

Gold and Inheritance Tax (IHT)

What Happens If You Pass on Gold?

Gold is treated like any other asset. If your estate exceeds the IHT threshold (£325,000 individual / £650,000 couple):

40% tax may be due on gold’s value

Strategies to reduce IHT:

Gifting coins during your lifetime
Holding gold in trust
Using spousal exemptions

Always seek tax planning advice from a professional.

Summary Table: UK Gold Tax Status (2025)

Gold Type	VAT	CGT	Notes
Gold Britannia Coins	❌ No	❌ No	Best tax efficiency
Gold Sovereign Coins	❌ No	❌ No	Also popular historic coin
Krugerrand / Maple Leaf	❌ No	✅ Yes	Not legal tender in UK
Gold Bars (995.0+ purity)	❌ No	✅ Yes	Compact but taxable gains
Collectible Coins (>180%)	✅ Yes	✅ Yes	May lose VAT exemption
Gold Jewelry	✅ Yes	✅ Yes	Not investment gold

Recommended Dealer: UKBullionByPost.co.uk

When buying investment gold, choose a reputable UK-based dealer. We recommend:

UKBullionByPost.co.uk

Sells CGT-exempt coins
VAT-exempt bullion bars
Live pricing
Fast insured UK delivery
Secure storage options available

FAQs: Gold Tax in the UK

Q: Is gold VAT-free in the UK?
A: Yes, investment-grade gold is exempt from VAT.

Q: What gold is CGT-free?
A: Only legal tender UK coins such as Britannias and Sovereigns.

Q: Can I avoid tax on gold bars?
A: You cannot avoid CGT on bars if you sell at a profit over the annual allowance.

Q: Should I buy coins instead of bars?
A: For tax efficiency, yes. Coins offer CGT exemption and better liquidity.

Q: Are silver coins CGT-free too?
A: Yes, if they are legal tender (e.g., Silver Britannia). But silver is still subject to VAT.

Final Thoughts: Maximise Tax Efficiency When Buying Gold in the UK

Investing in gold can be a smart hedge and long-term wealth strategy, especially when done tax efficiently.

Remember:

Always choose VAT-free and CGT-exempt coins when possible
Keep records and understand your tax thresholds
Use tools like CGT allowances and spousal exemptions
Shop with reputable dealers who understand UK tax laws

With the right approach, UK investors can build a tax-efficient gold portfolio with zero VAT and no capital gains.