Live Metal Prices / oz
Gold: 2212.03 USD
Silver: 24.64 USD
Platinum: 898.63 USD
Palladium: 1003.27 USD
Rhodium: 5125.00 USD

Do I Need To Pay Capital Gains Tax on Bullion?

What is Capital Gains Tax and How Does it Apply to Bullion?

A term used to describe the tax paid on the profit acquired from the sale of an asset whose value has increased, Capital Gains Tax may either be expressed as long- or short-term capital gains tax. While the rates of former depend on your tax bracket and are applicable to gains from the sale of assets owned for over a year, the latter is taxed as ordinary income and is only applicable to the profits from the sale of assets held for a maximum of one year. Because taxes on capital gains are only initiated upon the sale of an asset, owning stock shares are considered to be relatively tax-free since, even though they may appreciate annually, they will only be taxed upon their sale.

That said, it is worth noting, however, that on the application of capital gains tax to bullion, the tax rates typically range from 0-20%, although these values will vary with the investment options. For instance, several bullion investments like gold and silver coins are capital gains tax (CGT) free for investors in the United Kingdom (UK). This is, however, only applicable to the gold and silver coins produced in the UK. As a result, it is common to see more investors investing in the CGT-free gold and silver coins than in gold and silver bars, which are not representative of legal tender and so not tax-free. The most famous examples of CGT-free coins in the UK include:

However, because not all non-UK coins are legal currency in the UK, some are categorized as 'chargeable assets' in which case selling them within the UK, subjects any gains made to Capital Gains Tax. Some of the most popular coins subject to CGT in the UK include:

As capital assets, ownership of precious metal bullion are subject to CGT. Despite the seemingly fixed rates set for the CGT, there exist several categories of assets that have capital-gains treatments different from the norm. Some of these categories include investment and owner-occupied real estate, and collectibles. Collectibles include all forms of antiques, arts, jewellery, precious metals, and stamp collections for which a maximum capital gains rate of 28% is charged.

Typically, the thought of a 28% tax is daunting at best and may occasionally put off investors from keeping bullion for over a year.  Because the actual tax value paid depends on the duration of ownership of the precious metal (long- or short-term capital gains tax) and the payer’s ordinary income tax rate, there is no reason to be overly concerned about CGT when investing in bullions since few investors invest in large amounts. Nonetheless, in the event that you aim to, say maximize your bullion investment, the best approach is to sell smaller bullion quantities at a time; large enough to make a considerable amount of profit, but small enough to ensure that your profit falls below the limit set for that financial year, that way, you can avoid paying any CGT.

world map
Hello!
To make your shopping experience as seamless as possible, we offer the option to select your shipping country, preferred currency, and language. Please use the dropdown menus below to customize your preferences:
By selecting your preferred options, you will be able to view prices and shipping rates in your local currency and language, and be able to shop with ease.