View's please on holding physical Gold?

TUVOK

I would welcome views on holding physical gold, I.e. coins etc.
I do realize that gold at the moment is at a very high price at the moment but I am looking into the possibility of holding some in the form of coins, Krugerrands etc.
Any help in where/how to purchase, storing the coins, possibly selling them in the future and helping with Inheritance Tax would be much appreciated.
Thank you.

Ash_Pole

I've got a small number of coins, there are plenty of websites where you can buy these (Chards, Atkinson's, Bullion by Post etc). You can usually use a credit card. Mine are well hidden, only close family know in case something happens to me. There will always be some risk involved of course. I've never sold any but bear in mind the buy/sell spread is higher than most investments. If you really want to invest in gold hoping to make money (instead of liking shiny things) you'd probably be better with a gold EFT. Inheritance tax - of course gold coins are subject to this. If they can be found.

ColdIron

Bullion coins are your best bet. UK legal tender coins are free from CGT so Sovereigns, Britannias or Queen's Beasts. Bullion coins are free from VAT. If you buy from overseas quote VAT Notice 701/21A to stop customs from applying VAT or other duty

Krugerrands are widely available, recognised, tradeable, and can have low mark ups. You might also look at American Eagles, Canadian Maple Leafs, Austrian Philharmonics or Ducats, Chinese Pandas, Australian Nuggets or the Lunar series. Most modern coins will be 24 karat, older world coins 22k. It doesn't matter as a one troy ounce coin will contain one troy ounce of gold, the 22k one will weigh a bit more for the base metal content. A troy ounce is 31.104 grams, a cooking ounce 28.35 grams

Condition doesn't matter greatly from a bullion PoV

Avoid proof coins

Not much you can do about IHT, They make great gifts especially sovereigns for newborns etc

They are small and compact so with some imagination are easy to conceal. You will struggle to insure them so remember the first and second rules of Gold Club.They are the same as the first and second rules of Fight Club. This is important

There are good but also bad reasons to hold physical gold. Be clear about what yours are

These are reputable dealers for buying and selling

https://www.chards.co.uk/
https://www.bairdmint.com/
https://atkinsonsbullion.com/
https://www.bullionbypost.co.uk/
https://www.hattongardenmetals.com/

HTH

aroominyork

Are there any ETFs that only hold physical gold issued by the Royal Mint, where gains are exempt from CGT?

InvesterJones

aroominyork said:

Are there any ETFs that only hold physical gold issued by the Royal Mint, where gains are exempt from CGT?

Would that have any bearing on the ETF though? I mean, you can get funds which invest in UK gilts, but capital gain on the fund is taxable.

aroominyork

InvesterJones said:

aroominyork said:

Are there any ETFs that only hold physical gold issued by the Royal Mint, where gains are exempt from CGT?

Would that have any bearing on the ETF though? I mean, you can get funds which invest in UK gilts, but capital gain on the fund is taxable.

I'm not talking about gilts - I'm talking about gold. Britannias or other gold bullion created by the Royal Mint is exempt from CGT. 

Sam_666

You can buy them at royal mint website. Price now is through roof, so I wouldn't touch it, but.
To sell them will incur cost, as well as when buying you are paying higher then live price.
Storing will be issue, as it carries risk & cost to it.
https://en.wikipedia.org/wiki/Hatton_Garden_safe_deposit_burglary

InvesterJones

aroominyork said:

InvesterJones said:

aroominyork said:

Are there any ETFs that only hold physical gold issued by the Royal Mint, where gains are exempt from CGT?

Would that have any bearing on the ETF though? I mean, you can get funds which invest in UK gilts, but capital gain on the fund is taxable.

I'm not talking about gilts - I'm talking about gold. Britannias or other gold bullion created by the Royal Mint is exempt from CGT. 

Yes - same as gilts. My point was that despite gilts being exempt from CGT, ETFs that hold gilts are not, so perhaps it's the same here.

cwep2

aroominyork said:

I'm not talking about gilts - I'm talking about gold. Britannias or other gold bullion created by the Royal Mint is exempt from CGT. 

Capital gains is very much an individual thing, we have individual capital gains tax exemptions, eg your primary residence, gilts and gold coins issued by the royal mint that are legal tender. If you wrap these up in an ETF this will disappear, I am assuming that @InvestorJones was using the comparison that Gilts having tax free CG but ETFs that contain Gilts do not (and there are hundreds of these so this is well known), to demonstrate that an equivalent ETF containing Gold that would be CGT free if held as an individual, would not be if it was an ETF (I may be wrong about IJ's reasoning).

The advantages of ETFs are cheap bid/offer spread, no worries about insurance or having physical gold stolen (or lost) but you do have CGT to worry about. It probably depends a bit of size of investment and your own personal risk tolerance, a few hundred pounds of gold coins is unlikely to be a huge risk, £100k I wouldn't want to keep in my house, if you do then you then start going along the road of safes, insurance as well as 2-3% bid/ask spread to buy/sell (which is potentially £thousands. Also there are tax free wrappers such as ISAs or SIPPs that would allow holding a Gold ETF without CGT. 

You asked about physical though, so I'd stick to Britannia's and Sovereigns myself. 

subjecttocontract

I've found that buying sovereigns at local auctions works well for me. I've picked up a few bargains this way.

aroominyork

subjecttocontract said:

I've found that buying sovereigns at local auctions works well for me. I've picked up a few bargains this way.

Even given the scam of buyers having to pay commission?!