Selling a Gold bar

LYT_2

Hello
I am completely out of my depth here so could do with some help. My grand-parents bought a gold bar (100g) in the 80s (apparently it was fashionable back then) and they now want to give it to me. Here are my questions:

1) Can they just "give" it or do I need to declare something at HMRC? Is there tax to pay?

2) This Gold bar is currently in France and as I live in the UK, I would like to bring it back here. Can I just bring it in my luggage or do I need to declare it with HMRC?

3) Lastly, how do I go about selling it? Will there be tax to pay? Is now a good time to sell?

Thanks a lot
LYT

maypole

I believe that grandparents can give as much as they like. It's the parents who are restricted in.

Aegis

LYT wrote: »

Hello
I am completely out of my depth here so could do with some help. My grand-parents bought a gold bar (100g) in the 80s (apparently it was fashionable back then) and they now want to give it to me. Here are my questions:

1) Can they just "give" it or do I need to declare something at HMRC? Is there tax to pay?

They can, however, as it is an investment asset, gifting it to you will count as a disposal for capital gains tax purposes, therefore they will have to work out the market value and pay tax if they have made other disposals which take them outside the annual exemption. This is assuming they are currently UK resident, which they may not be if they are resident in France along with the gold bar. In that case they'll need to consult the French taxation rules, which may well be a lot harsher.

From a UK inheritance tax perspective (again, assuming the donors are UK resident), the gift may count against their nil rate band for seven years following the date of the gift, with tax due if the nil rate band has been fully depleted and they die within that seven year timescale. This is only likely to be an issue if they have made significant other gifts prior to yours, therefore may well be irrelevant.

2) This Gold bar is currently in France and as I live in the UK, I would like to bring it back here. Can I just bring it in my luggage or do I need to declare it with HMRC?

I can't think of any reason why HMRC would care about you carrying your own property from France to the UK, as long as the gifts documented and any relevant taxes are paid. Just be careful with your luggage if you're carrying something that valuable, as your travel insurance is unlikely to cover it as standard.

3) Lastly, how do I go about selling it? Will there be tax to pay? Is now a good time to sell?

If you sell soon after receiving the bar, it's unlikely to result in any tax as the acquisition cost will be deemed to be the market price on the date of the gift. Even if you hold on for a while, 100g of gold is apparently worth around £3,300 at the moment, so unless you sell enough assets to generate a total of £10,600 of capital gain in the year of disposal, there's not going to be any capital gains tax payable.

shaun_from_Africa

3) Lastly, how do I go about selling it? Will there be tax to pay? Is now a good time to sell?

There are a few places in the UK that will offer you a fair price for the gold bar. Don't consider selling to one of the "postal gold" companies as they generally offer a far lower price than the average market rate.
As Aegis stated, you should get somewhere in the region of £3300 (I've had a quick look at the place I sometime use and they are quoting £3218).

As to the best time to sell.
Only you can decide that as the price of gold fluctuates all the time and although it's high at the moment, it could continue to rise, or it may decide to fall drastically at any time.
There are loads of people who say that they can predict what the market will do and whilst some of them are often correct, there are also times when the same people are totally wrong.

weanie

I did have a selection of smaller gold bars some years ago - mostly 20g and from our time in Dubai.
I took them and some other gold to Chards in Blackpool and they gave me a good price there and then - I agree that those postal gold deals or high street sellers are to be avoided if you wan the best rate

LYT_2

Thanks a lot for the answers, very helpful. I have just realised that the bar is actually 1000g and not 100g. I guess this will take me over the £10,600 you mention Aegis so I do need to speak to Inland Revenue?

Shaun from Africa, you mention a place you usually use, would you mind giving me their details?

Thanks again
LYT

shaun_from_Africa

This is one company I've sold to a few times, and have always received quick payment.
http://www.hattongardenmetals.com/

I don't know anything about the CGT side of it, but it may be advisable to spend a few £s and speak to a tax advisor about this as there may well be legal ways to avoid having to pay too much tax.

atush

AS far as the CGT goes, it may affect your Grandparents but not you (unless you pay their cgt for them with the proceeds of the bar) but they each have a CGT exemption to use if they are uk tax resident still. Dont' know abt french taxes, I have a house there and pay property tax but I am not resident.

If you sell soon after the gift, the gain or loss on your part will be negligible.

LYT_2

Spoke to Inland Revenu and indeed they say that because I will be selling straight after I receive the gift, I will not have to pay any CGT as if I have any gain, it will be less than £10600. So that's good news.

Customs are also saying that I can bring the gold bar to the UK (as it is part of EU), no need to declare it. So that's good news again.

Thanks Shaun from Africa, I will look at them.

Last point I need to clear is whether my grand parents will have to pay anything in France...and when is the best time to sell!!

Thanks
LYT

shaun_from_Africa

and when is the best time to sell!!

That's really an impossible question to answer.

You could sell today and get a price that you are happy with then the gold price may rise 5% later this afternoon so you would have received an extra £1600 if you had waited.
Then again, it could just as easily drop in price instead.

Many people, both expert and non expert make and lose large amounts of money on what they think the price of precious metals will do in the future, and no one can know for certain when the best time for you to sell will be.
All you can do is to agree to sell when you get a price that you are happy with.

LYT_2

Fair comment. Thanks!