Tax & Law

The UK Money Laundering Regulations require precious-metal dealers above certain thresholds to identify their customers and report suspicious transactions.

The cash limit on gold purchases determines the amount above which dealers must verify and document the identity of the buyer under the UK Money Laundering Regulations.

When precious metals are transported across borders, cash-declaration duties apply above GBP 10,000, along with import VAT and customs rules when entering the UK from abroad.

The FIFO principle (First In, First Out) determines that, for tax purposes, when precious metals are sold the units acquired first are always deemed to be sold first.

The holding period is the length of time between the acquisition and disposal of an asset. In the United Kingdom it determines, together with the annual exempt amount, how much Capital Gains Tax is due on any gain.

In the United Kingdom there is no minimum holding period after which gains from precious metals become tax-free; instead, gains on disposal are subject to Capital Gains Tax above the annual exempt amount, unless the item is a UK legal-tender coin from The Royal Mint.

Identity verification is the legally required checking of a customer's identity when buying or selling precious metals above certain cash thresholds under the UK Money Laundering Regulations.

Investment gold is tax-privileged gold (bars and certain coins) whose purchase is exempt from VAT in the UK and the EU.

The VAT margin scheme is a special value-added-tax procedure under which dealers charge VAT only on their trading margin (the difference between purchase and sale price), not on the full sale price.

An over-the-counter cash deal is the purchase or sale of precious metals, securities or other assets for cash at the counter ("across the desk"), without recording the identity of the buyer.

A private sale transaction occurs when a private individual disposes of an asset – including physical precious metals – at a gain; in the United Kingdom such gains may be subject to Capital Gains Tax.

In the UK the annual exempt amount for Capital Gains Tax shields a set amount of total net gains from precious metal disposals each tax year, while gains on Royal Mint legal-tender coins are CGT-exempt without limit.

Investment gold is exempt from VAT in the United Kingdom (HMRC), provided it meets certain minimum requirements for fineness and form; the scheme derives from EU Directive 2006/112/EC.

The purchase of silver (bars, coins, industrial silver) is subject to VAT in the United Kingdom - unlike investment gold, which is VAT-exempt.

In the UK, income from savings and investments may be taxable, but physical precious metals are not taxed as investment income – on disposal they fall under Capital Gains Tax instead.