FIFO Principle in Precious Metal Sales

The FIFO principle (First In, First Out) is a matching rule used when calculating the taxable gain on the disposal of physical precious metals. If you buy gold in several tranches at different dates and prices and later sell only part of your holding, the rule assumes that the units bought first are also the units sold first, regardless of which specific coins or bars physically change hands.

Why the ordering matters for Irish CGT

In Ireland, a profit made by a private individual on selling bullion is a chargeable gain subject to Capital Gains Tax at 33%. Unlike Germany, which exempts a gain entirely once a one-year holding period has passed, Ireland applies no holding-period relief: a bullion gain remains within the charge to CGT no matter how long you have held the metal. What the FIFO ordering primarily affects here is which acquisition cost is set against the sale proceeds.

Irish share-identification rules (Taxes Consolidation Act 1997) generally treat assets of the same class acquired at different times on a first-in, first-out basis, subject to specific same-day and short-period matching provisions. For a straightforward bullion holding, this means your earliest purchases are matched against your disposals.

Worked example

Buy 1: 10 oz gold  on 01/03/2023  at EUR 1,800  = EUR 18,000
Buy 2: 10 oz gold  on 01/09/2024  at EUR 2,400  = EUR 24,000
Sale:   5 oz gold  on 15/04/2025  at EUR 2,800  = EUR 14,000

FIFO -> cost base: 5 x EUR 1,800 = EUR 9,000
Gain: EUR 14,000 - EUR 9,000 = EUR 5,000

Because the five ounces are matched to the first purchase, the cost base is EUR 9,000 and the chargeable gain is EUR 5,000. Note that in Ireland the length of ownership does not remove the charge; the gain is taxed at 33% after applying the annual personal exemption of EUR 1,270.

Practical points

• Keep records: every purchase should be documented with date, quantity, cost and the dealer invoice so the FIFO matching can be evidenced if Revenue queries it.
• Same-class matching: where bars or coins are not individually numbered, FIFO is the natural default for identifying which units have been disposed of.
• Different metals kept separate: gold ounces and silver bars are separate assets and are matched within their own class; you cannot pool them.
• VAT is a separate matter: investment gold is VAT-exempt in Ireland (VAT Consolidation Act 2010). FIFO is purely about the capital gains calculation, not VAT.

The historical gold prices can help you reconstruct an original cost base if paperwork has gone missing, and you can sketch out the likely tax effect of a sale in advance with the tax estimator.

Note: This article is general information and is not tax advice. For your individual position, please consult a qualified tax adviser.

In short

FIFO matches your oldest holdings against your disposals. In Ireland this mainly fixes the cost base for the 33% CGT charge, since there is no holding-period exemption; careful documentation of each tranche is what makes the calculation defensible.