Jul 2026
Jul 2026
Are Gold and Silver Bullion Subject to VAT in the UK?
In the UK, silver, platinum, and palladium bullion products are subject to a 20% Value Added Tax (VAT), while gold is exempt. Why is that and how does it affect your precious metals investments? In this blog, we explain what VAT is, why gold is exempt, why VAT is charged on silver bullion, which gold/silver bullion products are CGT-free, and more.
What is VAT?
Value Added Tax (VAT) is a type of consumer tax added to the price of goods and services in the UK. It’s already built into the marked price you see when shopping for items and charged at a standard rate of 20% for most consumer goods, retail items, and services. Some specific items, like home energy or children’s clothing, have reduced rates of 5% or even 0% VAT.
VAT was introduced to the UK in 1973, when we joined the European Economic Community (EEC), and replaced an older system called Purchase Tax.
In the UK, businesses that exceed a specific taxable turnover must register for VAT and charge the tax on their sales. VAT-registered businesses can also reclaim the VAT paid on business-related expenses and purchases.
Why is gold bullion VAT-free in the UK?
If you buy physical gold bullion in the UK today, you will pay 0% VAT. Under UK tax law, investment-grade gold is classified as an exempt asset, which means it’s treated the same as traditional investments like stocks.
This wasn’t always the case, however. Until a couple of decades ago, the UK government applied the standard 20% VAT rate to all gold bullion purchases. Since the European Union didn’t charge VAT on gold, this put British bullion dealers at a massive disadvantage, with many British investors taking their money overseas to buy cheaper gold.
To level the playing field and stop the UK market from losing customers, the government abolished VAT on investment gold on January 1, 2000. This VAT exemption remains in place for British buyers, even though the UK has since left the European Union.
What counts as investment-grade gold in the UK?
To be VAT-free, gold bullion must meet strict standards for purity, shape, and pricing. Here’s how His Majesty’s Revenue and Customs (HMRC) classifies investment-grade gold in the UK:
1. Gold bars and wafers
Gold bars and wafers are exempt from VAT if they meet the following criteria:
- Purity: Must be at least 99.5% pure (995 fineness or 24-carat)
- Shape: Must be a bar, ingot, or wafer in a weight standard accepted by the bullion markets (like 1 oz, 100g, or 1 kg)
- Refiner: Usually produced by an internationally recognised refiner (like those approved by the London Bullion Market Association or LBMA).
2. Gold coins
Investment gold coins are exempt from VAT if they meet the following criteria:
- Purity: Must be at least 90% pure (900 fineness)
- Age: Must be a gold coin minted after the year 1800
- Legal tender: Is, or used to be, official currency in the country that made it
- Price: Must be sold at a normal market price that doesn’t exceed the raw value of gold contained in the coin by more than 80% (meaning you’re not paying a massive collector’s premium).
This criteria covers almost all standard bullion products you see on our website, including the Royal Mint’s Gold Britannias (24-carat) and Gold Sovereigns (22-carat), as well as major global coins like the South African Krugerrand, Canadian Gold Maple Leaf, and American Gold Eagle.
Why is silver bullion subject to VAT in the UK?
In the UK, physical silver bullion is still subject to the full 20% VAT rate, regardless of purity or where it was minted. This is the same for other physical investment metals, like platinum bullion and palladium coins.
Most investors wonder – why are silver purchases subject to VAT when gold isn’t? This is mostly due to how governments view each investment. Silver is generally considered to be an industrial commodity rather than a financial asset. Because it’s widely used to manufacture everyday items like electronics, solar panels, and medical equipment, silver is treated more like a commercial product than an investment.
This means all UK investors must pay a 20% VAT when purchasing silver (this is automatically incorporated into the purchase price). This means that, if you buy a physical silver bar and have it delivered to your house, you’ll need the market price of silver to rise by 20% just for you to break even when you eventually sell it back to a dealer.
See: Platinum vs Silver: Which Is the Better Investment?
What if I’m VAT registered?
If you operate a VAT-registered business and are buying silver or platinum for legitimate business purposes, you may be able to reclaim the VAT element of the purchase price.
That said, the HMRC heavily scrutinizes gold, silver, and other precious metal purchases, so it’s important to consult with your accountant before trying to claim it back.
Are all Royal Mint bullion coins VAT-free?
One common misconception amongst UK investors is that coins minted by the Royal Mint are entirely tax-free. Unfortunately, this only applies to gold. All silver and platinum bars and coins are subject to standard UK VAT, even if they’re manufactured by the Royal Mint (e.g. Silver Britannias).
This misconception might come from confusion between VAT and Capital Gains Tax (CGT). VAT is a sales tax paid when you buy an asset, while CGT is an investment tax paid on the profits made when you sell an asset. So if you buy a silver bar, you pay VAT upfront. If you hold that bar for five years and sell it at a profit, the profit is subject to CGT.
The UK currently has a tax-free CGT allowance of £3,000 for individuals. This means that if your total investment gains across all assets (bullion, stocks, crypto, property) exceed £3,000 in a single financial year, you’ll owe tax on the excess profit.
That said, all British bullion coins with a face value stated on them (legal tender) are exempt from CGT.
Bullion coins and Capital Gains Tax (CGT) in the UK
All official, modern UK coins produced by the Royal Mint are treated as legal tender by HMRC. This means you don’t have to pay any Capital Gains Tax (CGT) on profits made when selling them, even if they exceed the annual £3,000 threshold.
To make sure a Royal Mint coin qualifies for CGT exemption, check:
- Face value: The coin must have a fiat currency denomination stamped directly onto it (for example, a 1 oz Gold Britannia will state “100 POUNDS")
- Legal tender status: The coin must be officially recognised as UK legal tender (this includes all Sovereign and Britannia coins, as well as those in the Lunar and Tudor Beasts series).
For more information about CGT and gold bullion in the UK, read our blog article: Gold Bullion Coins & Capital Gains Tax.
Is silver bullion still a good investment?
Knowing that silver bullion is subject to a 20% VAT while gold is not, many investors wonder… is it even worth it to invest in silver? The answer is yes, but it’s important to consider the difference between what gold and silver offer in terms of investment.
Gold is typically viewed as a stable, safe-haven asset while silver is more of a volatile, long-term speculative asset. This volatility gives silver more capacity for explosive growth – when the silver market moves, it has historically outpaced gold in percentage gains. To see that volatility in action, we only need to look back at silver prices within the last year.
Silver started 2025 trading at around $29 per oz, before a global supply deficit, geopolitical uncertainty, and growing industrial demand sent it on a historic surge. It climbed over 130% to over $70/oz by the end of the year and eventually reached an all-time-high of $121.64 on January 29, 2026. It then went through an equally dramatic correction, dropping back to trade at around $60 per ounce as of July.
These price movements show that, with patience, silver’s dramatic price spikes can easily erase the initial 20% VAT fee and deliver returns. Just don’t expect the metal to behave the same as gold.
Learn more about silver investment here: Why You Should Consider Silver Investment
What’s a better investment: gold bars or gold coins?
If you choose to invest in gold bullion, your two main options are gold bars and gold coins. Each of these offers different benefits in terms of lower premiums vs tax exemptions.
Gold bars: Lowest premium per gram
Gold bars, also called ingots, are rectangular blocks of high-purity gold stamped with weight, purity, and the manufacturer's mark. They're available in a range of sizes, from small 1 gram bars up to massive 1 kilogram bars, making them suitable for a wide range of budgets and investment objectives.
The advantage that gold bars have over gold coins is that they’re easier to manufacture, giving them the lowest possible premiums over the raw spot price of gold. If you’re buying large weights (like 100g or 1 kg gold bars), this means you’ll be getting substantially more pure gold for your money.
The disadvantage, however, is that gold bars are fully subject to Capital Gains Tax (CGT) when selling (if your total annual investment profits exceed the £3,000 threshold).
Gold coins: Entirely tax-free options available
Gold coins are round pieces of gold bullion struck with detailed designs. They’re available in a range of purities, from 22-carat up to 24-carat, and sizes from 1/10 of an ounce up to the standard 1 oz and even larger 2 oz sizes.
The main advantage of gold coins over gold bars is that, if the coin is UK legal tender (minted by the Royal Mint with a face value in GBP), it is 100% exempt from CGT. This means that, if you buy Gold Sovereigns or Gold Britannias, you could make £50,000 in profit when selling and not have to pay a single cent of capital gains tax.
The disadvantage is that coins carry higher premiums than gold bars of equivalent weight. It’s also important to note that foreign gold coins (like the South African Krugerrand or American Eagle) do NOT qualify for the UK CGT exemption.
Keep Reading: Gold Bars vs Coins: Which Is Better for Investors?
Summary: Are gold and silver bullion subject to VAT in the UK?
To sum up:
- All investment-grade gold bullion is VAT exempt in the UK
- All UK legal tender gold coins are CGT-free in the UK
- All silver bullion is subject to VAT in the UK
- All UK silver coins classed as legal tender are CGT-free in the UK.
Browse our most popular CGT and VAT-free coins:
FAQ: Are gold and silver bullion subject to VAT in the UK?
Is gold VAT-free in the UK?
Yes, gold bullion (including bars and coins) is entirely VAT-free in the UK.
Is silver VAT-free in the UK?
No, silver bullion products are all subject to VAT in the UK. However, legal tender UK coins, such as the Silver Britannia, are exempt from Capital Gains Tax (CGT), meaning you don’t owe tax on profits made when sold. This is different to silver bars, which count towards your annual £3,000 CGT allowance.
What VAT do I have to pay on silver bullion?
Silver bullion in the UK is subject to a 20% VAT.
Do I have to pay VAT on silver bullion if I live outside the European Union (EU)?
If you’re buying gold bullion from a UK dealer (or the Royal Mint), but live outside the UK, you do not have to pay VAT. Orders that are dispatched to international addresses outside the UK will not be charged VAT on silver, platinum, or palladium.
That said, your shipment will be subject to your local country’s import duties, customs clearance fees, and any other domestic sales taxes upon arrival. For that reason, it’s always best to check your own country’s customs rules before you place an international delivery order.
What is the VAT margin scheme?
In the UK, the VAT margin scheme allows eligible businesses reselling second-hand goods, antiques, or collectors' items to only pay VAT on their profit margin rather than the full selling price. This prevents double taxation of goods that have already been taxed.