CGT-Free Gold Coins in the UK: Which Coins Qualify and Why (Autumn Budget 2026 Update)

UK legal tender gold coins, including the Sovereign (1837 onwards), the Britannia, and the Royal Tudor Beasts, are exempt from Capital Gains Tax because HMRC treats them as sterling currency under TCGA 1992 s21(1)(b). Gold bars and foreign coins, such as the Krugerrand, remain chargeable assets subject to standard capital gains rates.

Why UK legal tender coins sit outside Capital Gains Tax

UK legal tender coins are exempt from Capital Gains Tax (CGT) because they’re legally classified as sterling currency under British tax law.

Under Section 21(1)(b) of the Taxation of Chargeable Gains Act 1992 (TCGA 1992), currency in sterling is explicitly excluded from being treated as a chargeable asset for CGT purposes. Because sterling is the official legal tender of the UK, the law treats those coins as a unit of account rather than standard property, shares, or collectible investments.

For that reason, no capital gain or loss is recognised by HM Revenue & Customs (HMRC) when you sell, trade, or dispose of official sterling currency, regardless of the holding period or total gain realised.

HMRC clarifies this exact principle in its Capital Gains Manual under guidance CG78305:

“Sovereigns minted in 1837 and later years and Britannia gold coins are currency”.

It’s worth noting that the exemption has nothing to do with the metal’s purity, weight, or the fact that it’s made of gold. For example, two items with near-identical gold content can land in entirely different tax categories based solely on their legal designation:

• 1 oz Gold Britannia: Struck by The Royal Mint as the official currency with a nominal face value of £100. Because it is sterling legal tender, it sits completely outside CGT.
• Gold Sovereign: Struck with an official face value of £1. Minted in 1837 or later, it is legal tender sterling currency and exempt from CGT.
• Investment Gold Bar: Cast or minted from pure gold, carrying no nominal face value. It is not currency, making it a chargeable asset subject to CGT rules upon disposal.

As you can see, a coin’s nominal face value (£1 for a Sovereign, £100 for a 1 oz Britannia) has no bearing on its market value or gold content. But the mere fact that a coin carries an official face value is what establishes it as UK legal tender currency at the time of acquisition and disposal.

Because qualifying UK coins sit outside the CGT framework, any gains made upon selling them do not consume any portion of an investor’s annual Capital Gains Tax free allowance (currently set at £3,000 for the 2026/27 tax year).

Gold coins that qualify

HMRC outlines which UK bullion coins are exempt from CGT:

• Gold Sovereigns: Sovereign coins minted in 1837 and later – including quarter, half, double, and £5 Sovereigns – qualify for CGT exemption. The 1837 cutoff date is essential, since earlier Sovereigns (from 1817 to 1837 issues) are no longer current legal tender.
• Gold Britannias: All Gold Britannias from 1987 onwards qualify across every fractional size (1/10 oz, ¼ oz, ½ oz, and 1 oz), as well as both the historic 22ct (pre-2013) and 24ct (post-2013) specifications.
• Commemorative and Theme Series: Royal Mint bullion series carrying official UK legal tender status, such as the Royal Tudor Beasts, Queen’s Beasts, and Lunar coins, fall within the exemption.

At StoneX Bullion, we offer a full range of CGT-free gold bullion coins, including Gold Britannias, Gold Sovereigns, and Gold Tudor Beasts.

Gold that does not qualify

Physical gold investments that do not qualify for UK CGT exemption include foreign bullion coins and gold bars. HMRC splits non-qualifying physical gold into two distinct tax classifications:

1. Foreign bullion coins (standard chargeable assets)

Foreign bullion coins – such as the South African Krugerrand, Canadian Maple Leaf, American Eagle, Australian Kangaroo, and Austrian Philharmonic – are legal tender in their respective countries of origin.

Under HMRC guidance CG78305, coins that represent currency of the issuing nation are classified directly as standard chargeable assets. This means HMRC views them as foreign currency rather than personal possessions. Any capital gains realised when selling these coins are measured against your annual CGT exemption, with gains above that limit subject to standard CGT rates.

2. Gold bars, wafers, and ingot bullion (chattels)

Because gold bars carry no face value or legal tender status in any jurisdiction, HMRC treats them as chattels (defined under HMRC Helpsheet HS293 as tangible, movable personal property).

Chattels are still chargeable assets. In some cases, chattels rules may affect how a gain on a small bar is calculated, but whether they apply depends on how and to whom the bar is sold. Check with a tax adviser before relying on these rules.

Face values refer to the 1 oz size unless stated. VAT exemption applies to investment gold; CGT treatment as set out in HMRC Capital Gains Manual CG78305. General information, not tax advice.

Pre-1837 coins and the chattels rule

CGT exemption for Gold Sovereigns only applies to coins struck in 1837 and later years.

Sovereigns minted between 1817 and 1837 – such as those featuring King George III, King George IV, or King William IV – are no longer considered current legal tender currency in the UK.

These pre-1837 Sovereigns are classified as collectible chattels, which means they do not benefit from the same currency exemption as modern Sovereigns. Instead, they fall under the chattel rules, so a gain is generally not taxable if the sale proceeds are £6,000 or less (and HMRC’s ‘set’ rules may apply if coins are sold as a collection).

See More: The British Gold Sovereign - All You Need to Know

VAT and CGT are two separate tests

Coins can be exempt from Value Added Tax (VAT) but still subject to CGT, since these taxes are governed by two completely separate pieces of legislation with different criteria.

Let’s take the South African Krugerrand for example, explaining why it’s VAT free in the UK:

Under HMRC rules (VAT Notice 701/21), a coin qualifies as VAT-exempt ‘investment gold’ if it:

• Was minted after 1800
• Has a gold purity of at least 90%
• Is (or was) legal tender in its country of origin
• Is normally sold at a price not exceeding 180% of the value of its gold content.

Because the Krugerrand was minted after 1800, is made from 22-carat gold, and holds legal tender status in South Africa, UK buyers pay 0% VAT when purchasing these coins.

But why is it subject to CGT?

UK CGT exemption relies on an entirely different standard that specifically exempts UK sterling legal tender. But the Krugerrand’s face value is denominated in South African Rand, not British pounds sterling, so it remains a standard chargeable asset.

In short: VAT is a purchase tax governed by international investment gold criteria, while CGT is a gains tax governed strictly by UK currency status.

Read More: Is Gold Exempt From Inheritance Tax in the UK?

How the numbers compare on the same gain

Let’s compare two different scenarios where an investor buys gold and later sells it for a £10,000 gain.

Note: This is a hypothetical example designed solely to illustrate how UK Capital Gains Tax rules work. It is not a price forecast or prediction of future gold returns.

In the first scenario, the investor is selling UK legal tender coins (Britannias or Sovereigns):

• Total gain realised: £10,000
• Taxable status: 100% CGT exempt under UK currency rules
• Annual allowance used: £0 (not needed)
• Total tax owed: £0

Because British Sovereigns and Britannias are UK sterling currency, the entire gain is free of CGT, regardless of how large the gain is or what income bracket the investor falls into.

In the second scenario, the investor is selling foreign bullion coins (i.e. Krugerrands) or gold bars:

• Total gain realised: £10,000
• Taxable status: Subject to CGT
• Minus annual CGT allowance (£3,000): Reduces the taxable gains to £7,000
• Total tax owed: Depends on the tax bracket:
  • Basic-rate taxpayer (18% CGT): Pays £1,260 (£7,000 x 18%)
  • Higher/additional-rate taxpayer (24% CGT): Pays £1,680 (£7,000 x 24%)

Because foreign coins and gold bars are not classified as UK sterling currency, the entire gain above the £3,000 tax-free allowance is taxed as a standard capital gain.

For illustration only, the chart also shows how the same gain would be taxed at 40% and 45%. These rates are discussed in pre-Budget commentary, though no such change has been announced yet.

Autumn Budget 2026: what changed for Capital Gains Tax

The Autumn Budget on 28 October 2026 left the main rates of Capital Gains Tax unchanged. For gold bars and foreign bullion coins, the rules for the 2026/27 tax year remain:

- £3,000 annual exempt amount per individual (also confirmed for 2027/28)

- 18% on gains within the basic-rate income tax band

- 24% on gains within the higher or additional-rate bands

The CGT changes announced in the Budget focus on business owners. The lifetime limit for Business Asset Disposal Relief is set to fall from £1 million to £500,000 from 6 April 2027, and a new Founders' Relief with a 10% rate is planned from the same date, subject to consultation.

The CGT measures published so far do not change the treatment of UK legal tender coins. Their exemption rests on their legal definition as sterling currency under Section 21(1)(b) of the Taxation of Chargeable Gains Act 1992, not on a rate or allowance, so Sovereigns and Britannias remain outside Capital Gains Tax.

Records, reporting and selling

Whenever you purchase gold bars or foreign coins, keep all original invoices and receipts. HMRC requires evidence of your original cost basis (acquisition price) to calculate realised gains accurately upon disposal. Your transaction records should clearly show:

• Purchase date and price
• Weight, purity, and serial numbers (if applicable)
• Sale date, disposal proceeds, and associated transaction fees.

For a detailed breakdown of thresholds and compliance when acquiring metal, read our guide on when buying gold becomes reportable.

If you dispose of gold bars or foreign bullion coins, you may need to report the gain to HMRC (for example when your total gains across all taxable assets exceed the £3,000 annual exempt amount). You can report taxable gains on physical gold through your annual UK Self Assessment tax return or using the HMRC’s online ‘real time’ CGT service. The full reporting rules are on GOV.UK.

Note: Selling UK legal tender coins such as Britannias or Sovereigns does not give rise to a chargeable gain, so it does not need to be reported for CGT. Keeping your purchase records is still sensible, however, such as for Inheritance Tax purposes.

See More: How Much Gold Can You Own?

Frequently asked questions

Are gold Sovereigns CGT-free?

Yes, Gold Sovereigns struck in 1837 or later are legal tender currency in the UK, making them 100% exempt from Capital Gains Tax (CGT).

Is the gold Britannia exempt from Capital Gains Tax?

Yes, Gold Britannia coins are exempt from CGT in the UK, regardless of your income tax bracket or how large your gain is.

Do I pay Capital Gains Tax on Krugerrands in the UK?

Yes, South African Krugerrands are subject to Capital Gains Tax in the UK, even though they are exempt from VAT upon purchase.

Are gold bars subject to Capital Gains Tax?

Yes, gold bars, wafers, and ingots are subject to Capital Gains Tax in the UK.

Could the Autumn Budget 2026 change the CGT exemption on UK coins?

No. The Autumn Budget on 28 October 2026 left CGT rates and the £3,000 annual exempt amount unchanged, and the CGT measures published so far do not affect UK legal tender coins. Their exemption comes from the legal definition of sterling currency in TCGA 1992, so it would take a change to that legislation to affect it.

Do I pay VAT on gold coins in the UK?

No, you do not have to pay VAT on gold coins in the UK, so long as they’re classed as investment gold:

• Minimum purity of 90%
• Be (or have been) legal tender in their country of origin
• Minted after 1800
• Normally sold at a price not exceeding 180% of the value of their gold content.