Is Gold Tax-Free? VAT and Capital Gains on Gold & Silver Explained

The headline: investment gold is usually VAT-free

Across the European Union, “investment gold” is exempt from VAT under Council Directive 2006/112/EC (Articles 344–346). The same is true in the United Kingdom. That exemption is a big deal: it means you don't pay a 20%-or-so sales tax just to convert money into gold, unlike most goods.

What counts as “investment gold”

The exemption is precise. Under the EU definition (mirrored in the UK), investment gold means:

• Bars or wafers of a purity of at least 995 thousandths (99.5%), in weights accepted by the bullion market; and
• Gold coins of purity at least 900 thousandths (90%), minted after 1800, that are or have been legal tender in their country of origin, and normally sold at no more than 180% of their gold content's value.
• The European Commission and UK's HMRC each publish an annual list of qualifying coins, so dealers and buyers have certainty.

An investment gold coin is … a gold coin minted after 1800 that is of a purity of not less than 900 thousandths, is, or has been, legal tender in its country of origin, [and] is normally sold at a price that does not exceed 180% of the open market value of the gold contained in the coin.

— HMRC, VAT Notice 701/21A (UK)

Silver and platinum are taxed differently

Here's the catch many buyers miss: the VAT exemption is for gold only. In the EU and UK, silver, platinum and palladium are treated as ordinary goods and generally attract standard-rate VAT (around 20% in the UK; the rate varies by EU member state). That is one reason a given sum buys far more “face metal” in gold than in silver once tax is included — and a factor worth weighing in the gold-vs-silver decision.

Capital gains tax: where coins beat bars

VAT is the tax on buying; capital gains tax (CGT) is the tax on profit when you sell. Here the UK offers a striking perk: UK legal-tender bullion coins are exempt from CGT because they are British currency. That includes the Britannia, Sovereign, Lunar and Queen's Beasts ranges — you can make unlimited tax-free profit on them as a UK resident.

The United States: no VAT, but watch sales tax and CGT

The US has no VAT. Instead, sales tax is set state by state — the large majority of states exempt investment-grade bullion, but a handful still tax it, and thresholds and effective dates change. On profits, the IRS treats physical gold and silver as collectibles, so long-term gains can be taxed at a maximum rate of 28% (higher than the 15–20% on stocks); metal held a year or less is taxed as ordinary income.

• Five states levy no statewide sales tax at all; most others exempt bullion, but some (varying over time) tax it — check your state.
• IRS Topic 409: net long-term gains on collectibles such as coins are taxed at up to 28%.
• Hold a year or less and gains are taxed as ordinary income, not at the collectibles rate.

How tax shapes a smart buying decision

Tax is rarely the only factor, but it tilts the maths:

• For VAT-conscious buyers, gold is far more tax-efficient than silver in the EU/UK.
• For UK investors who may sell at a profit, UK legal-tender coins (Britannia, Sovereign) combine VAT-free buying with CGT-free selling.
• For US buyers, the bullion itself is often sales-tax-free, but plan for the 28% collectibles rate on long-term gains.
• Everywhere, keep records and certificates — they're essential if you ever need to evidence a purchase for tax.

Buy tax-efficient gold with crypto

You can buy VAT-free investment gold — including UK CGT-exempt coins like the Britannia and Sovereign — with Bitcoin and other crypto at BTC Mints. Browse gold coins and bars, and always confirm the current rules in your own country before ordering.