UK VAT and investment gold: what is exempt

One of the reasons London became the centre of the gold market is that, in the UK, investment gold is exempt from VAT. That exemption is precise, though, and it applies to the metal itself — not to most of the services that surround it. Owners are sometimes surprised to see VAT on a storage invoice. This is why.

What counts as investment gold

Broadly, HMRC treats as investment gold bars and wafers of a purity of at least 995 thousandths in a weight accepted by the bullion markets, and certain gold coins that meet tests of purity, age, legal-tender status and pricing relative to their gold content. HMRC publishes the detailed rules, including a list of coins that qualify.

Supplies of investment gold — buying and selling the metal — are generally exempt. Gold that does not meet the definition, such as lower-purity jewellery or some medals, is normally standard-rated.

Services are different

• Storage and safekeeping of gold are usually standard-rated services, regardless of whether the gold itself is investment gold.
• Transport within the UK is generally standard-rated; the treatment of international transport depends on the route and the customer.
• Insurance premiums are typically exempt from VAT but may attract Insurance Premium Tax.
• Intermediary services in a supply of investment gold can sometimes be exempt — the rules are specific.

The metal can be exempt while the vault fee next to it carries VAT. Both can be right.

How it appears on our invoices

Our invoices show each line with its own VAT rate and a per-rate VAT summary, so you can see exactly which services carry VAT and which do not. If you are a business that can recover VAT, the summary is what your accountant will need.

Outside the UK

The EU has a broadly similar investment-gold regime, but member states differ on details. Other jurisdictions — Switzerland, the UAE, Singapore and the US among them — have their own rules for both the metal and the services. Where you store and where you buy can change the tax picture materially.

Records worth keeping

Whether a supply was exempt can matter years later — on a sale, an audit or an estate valuation. It helps to keep the purchase invoice showing the bar’s weight and fineness, the certificate listing the bars by serial number, and any documents showing where the metal has been held since. Our certificates and storage records are designed to provide that trail, and they remain available in your portal for as long as you are a client.

Importing and exporting

Movements across borders raise separate questions. Import VAT relief for investment gold generally depends on the metal meeting the investment-gold definition and on the correct procedure being used at the border. If the paperwork is wrong, import VAT may be charged and then have to be reclaimed, which takes time and ties up cash. When we arrange an international movement we prepare the customs documents from the same bar record used for your certificate, so the description of the metal is consistent from start to finish.

Coins deserve a mention. Some gold coins qualify as investment gold and others do not, depending on criteria such as purity, legal-tender status and the relationship between their sale price and their gold value. If you hold or intend to buy coins, check their status individually rather than assuming.

This article is a general overview. Tax rules change and depend on your circumstances; take professional advice before acting on it.