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VAT – All you need to know (Updated 2019)
Jan
First of all, we’ll briefly explain what VAT is and when it applies. We then quickly move onto how this applies to purchases of precious metals, and then finally reveal some powerful methods of buying gold and silver in the UK withut paying any VAT at all!
What is VAT?
Value Added Tax (VAT) is added onto most consumer goods and services in the UK. The current general rate of VAT is 20% with some items being at a reduced or zero rate. This is added at the point of sale and the consumer will bear the charge.
Exemptions to VAT
Many food and drinks are zero-rated except alcohol, confectionary and hot food. Most cultural and leisure activities are exempt as are some health, education and charity goods and services.
VAT on silver (exclusively Tax Free at Physical Gold)
If you buy any form of silver in the UK, your purchase is
subject to 20% VAT, regardless of purity and whether it’s a coin or bar. Despite this cost, physical silver investment in the UK has continued to grow in popularity, as analysts believe the silver price is severely undervalued.
But as tax efficient investment specialists, we couldn’t accept being down 20% due to tax before you’ve even started. So, we have exclusively developed two innovative solutions for the purchase of silver bars and a solution for silver coins in the UK without incurring VAT – meaning you get to keep more of your profits.
1. VAT-Free Silver Coins (Delivered only)
Exclusively to Physical Gold in the UK, you can now purchase silver coins without being charged UK VAT. How is this possible? Well, we spent 9 months and a ton of cash with VAT-specialists to look at how we could give you what you wanted. And we came up with this solution.
Here’s the deal
To meet the criteria, all our coins have to have a face value and therefore be legal tender in their country. This discounts silver rounds which don’t possess the face value as they’re minted privately rather than in a National mint. Secondly, they need to have a trail within the EU to trigger an EU VAT treaty whereby we can’t charge you VAT on your purchase.
The best part?
Even buying coins direct from the Royal Mint itself will attract VAT. Buying VAT-Free silver coins through our portal is the cheapest, smartest way of investing in silver coins within the UK. We offer a range of bullion coins from 1oz Britannias and 2oz Queen’s Beasts coins to the most popular foreign silver coins. If you’re buying a large number of silver coins or looking to build a substantial holding over time, then don’t forget that any UK silver coins are also Capital Gains Tax-free to UK residents.
2. VAT-Free Silver Bars (For Delivery)
Brand new for 2018, we are at last able to deliver pure silver bars to UK addresses without charging UK VAT. You can benefit from the lower premiums of the larger silver bars, and buy VAT-Free silver bullion delivered directly to your door.
But how’s this possible?
A majority of silver bars have no face value and so fall at the first hurdle. Despite the 20% VAT, demand for silver bars is still really high due to the current low silver price and the extra value you can achieve by buying larger silver bars. But all of the silver bars we offer for delivery are unique in that they actually have a face value too! Like, the silver coins, we exploit the EU tax treaty in its supply chain and can deliver the silver bullion direct to your door without charging VAT. We like to name these special bullion bars as ‘Coin Bars’ as they represent the best of both worlds.
3. VAT-Free Silver Bars (For Storage)
For some, while silver investment is a great idea, they don’t want to store the metal themselves. In this case, we provide an alternative solution for those wishing to buy VAT-Free silver bars for storage. Our silver bars are stored, on your behalf, in the Channel Islands. Keeping them offshore means your purchase is exempt from VAT as they fall outside of UK tax. With large bars available, you’re able to obtain tighter margins on your silver, while still being tax efficient
VAT on gold
This depends on what type of gold you buy. Since the 1st January 2000, the VAT Act 1994 exempts Investment Grade Gold from Value Added Tax. So as long as your purchased gold qualifies as Investment Grade, then no VAT will be charged.
There are a few requirements for gold to qualify for an exemption:
Firstly, it has to be in the form of a coin or a bar. For this reason, VAT is still added to gold jewellery. 
You should also avoid gold dust, gold ore and gold watches if you want to be tax efficient.
If you opt for a gold bar, the purity needs to be at least 995 thousandths. The good news is that a majority of gold bars on the market exceed this, at 999 thousandths gold, with the rest generally meeting the minimum requirement.
..and how about coins?
For gold coins, the purity target is lowered to 900 thousandths, meaning that any coin of 22 carats or higher will qualify. There are a few extra guidelines for coins – they must be minted after 1800, have been legal tender in its country of origin and not usually sell at more than 180% of the market value of its gold content. Essentially these additional rules exclude very old, obscure numismatic coins.
6 Hacks to buying the best value gold sovereign coins – Watch our video now!!!
If all this sounds complicated, don’t worry. We only sell gold coins and bars that meet these requirements and qualify as Investment Grade, so you’ll never pay Value Added Tax when buying through Physical Gold.
How can you take this a step further?
If you want your gold investment to be completely tax-efficient, then buying UK gold coins also benefits from being Capital Gains Tax-free. They already meet the VAT exempt criteria but are also tax-free upon sale due to their legal tender status. With each Sovereign, Britannia, special edition UK coins and variants of these, each coin possesses an actual face value. The Government can’t tax you on the movement of legal currency, so buying and selling UK gold coins is completely tax-free!