Capital Gains Tax (CGT)

Capital Gains Tax (CGT)

CGT is a tax on the profit made from the disposal of assets by UK residents. overseas investors should see their own countries taxation rules.

Tax is payable on assets such as Bullion, Property and shares, should a profit be made. Tax is only levied on the proportion of profit made minus any tax relief, for year 2020/21 this limit is £12,300 for every tax paying individual. The rate of taxation on the remaining profit can range from 18%-28% depending on your tax bracket.

For example: Over one financial year, an investor bought bullion for £50,000 and later sold it for £76,000. The investor made a gain of £26,000 and this is what they would be taxed on. This would work out as follows : £26,000 (profit) - £12,300 (CGT tax relief) = £13,700

Add this amount to your taxable income.

If this amount is within the basic Income Tax band you’ll pay 10% on your gains (or 18% on residential property). You’ll pay 20% (or 28% on residential property) on any amount above the basic tax rate.

If you are reading this you will no doubt be looking at CGT as it relates to Bullion and/or Coins. You will note from the above that bullion products are not exempt from CGT in the UK. These include bullion bars / ingots / medallions / coins that cannot be classified as legal tender in the UK.

Bullion Bars and Ingots are not CGT Exempt

Foreign Bullion coins are not CGT Exempt

UK Gold / Silver Coins Pre-1837 are not CGT Exempt.

What is exempt from CGT

You will pay no CGT on coins which have a monetary value in the UK, these are classified as 'legal tender', and as such are exempt from capital gains tax.

Sovereigns minted from 1837 to date including proof sovereigns and their derivatives. Any UK issued gold proof versions or standard currency coins, these include all coins from 1p - £2. All quintuplet Proof and Brilliant Uncirculated (BU) Sovereigns have a monetary value of £5, as do commemorative 'Crowns' issued since 1990.

In 1987 the UK Royal Mint introduced the first £100 face value coins with the launch of the 1oz Gold 'Britannia', this was followed in 1997 by its silver equivalent with a face value of £2. All UK issued Britannia coins are exempt from CGT, in either proof or bullion versions. it should be remembered that Silver coins are not exempt from VAT. Following on from the Britannia series the Royal Mint have since introduced many more commemorate coins, from the Queens Beasts to Music Legends and even a series to celebrate '007' James Bond, all carry monetary values and all are CGT exempt.

 

 

All Sovereigns struck : 1837 - Date CGT Exempt

UK Special limited edition coins CGT Exempt

UK Gold / Silver Bullion issues with monetary value CGT Exempt.