Does Gold Attract Capital Gains Tax in the UK?
It depends on what you buy. In the UK, Capital Gains Tax (CGT) applies to profits made on the disposal of most assets, including precious metals. However, there is an important and valuable exemption: UK legal tender gold and silver coins are CGT exempt.
This makes coins such as the Gold Sovereign, Gold Britannia, and Silver Britannia particularly attractive for UK investors — any profit you make when selling them is completely free from CGT, regardless of the size of the gain.
Which Gold & Silver Products Are CGT Exempt?
To qualify for CGT exemption, a coin must be UK legal tender. The following are CGT exempt for UK investors:
- Gold Sovereigns (all years) — face value £1, legal tender
- Gold Britannias (all years) — face value £100, legal tender
- Silver Britannias (all years) — face value £2, legal tender
- Other UK Royal Mint legal tender coins
Gold and silver bars, and foreign coins such as Krugerrands or American Eagles, are not CGT exempt and are subject to standard CGT rules.
What About the Annual CGT Allowance?
Every UK individual has an annual CGT allowance — gains below this threshold are not taxed. For the 2025/26 tax year, this allowance is £3,000. Gains above this are taxed at your marginal rate (currently 18% for basic rate taxpayers and 24% for higher rate taxpayers on investment assets).
For investors holding non-exempt bullion (such as gold bars), careful planning around the annual allowance can help minimise tax liability.
Is VAT Charged on Gold & Silver?
In the UK, investment gold is VAT exempt — this applies to gold bars and coins of sufficient purity (generally 99.5% or higher for bars, and recognised bullion coins). This is a significant advantage over other commodities.
Silver is not VAT exempt in the same way. However, a VAT Special Scheme applies to silver bullion sold by registered dealers, which means VAT is charged only on the dealer’s margin rather than the full sale price. This significantly reduces the effective VAT burden for buyers.
Practical Tips for Tax-Efficient Bullion Investing
- Prioritise CGT-exempt UK coins — Gold Sovereigns and Britannias should form the core of a tax-efficient UK bullion portfolio.
- Use your annual CGT allowance — if you hold non-exempt bullion, consider disposing of gains up to the annual threshold each tax year.
- Keep records — maintain purchase receipts and valuations for all bullion holdings for accurate CGT calculations.
- Seek professional advice — tax rules can change and individual circumstances vary. Consult a qualified tax adviser for personalised guidance.
This article is for informational purposes only and does not constitute financial or tax advice.
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