UK gold tax: CGT, VAT and Inheritance Tax explained

The UK has one of the most generous tax regimes for physical gold in the world, but only if you buy the right products. This guide sets out each tax, links every rule to HMRC or GOV.UK, and shows the difference in pounds. It is general information, not tax advice; a chartered tax adviser can look at your own position.

Do you pay VAT on gold in the UK?

Not on investment gold. Section 2.1 of HMRC VAT Notice 701/21 defines investment gold as:

• Bars and wafers of gold "of a purity not less than 995 thousandths" in a weight accepted by the bullion markets (section 15 of the notice lists the accepted weights, from small gram bars up to large bars).
• Coins minted after 1800 that are at least 900 thousandths fine, are or have been legal tender in their country of origin, and are of a type "normally sold at a price that does not exceed 180 per cent of the open market value of the gold contained in the coin".
• Listed coins: any coin on HMRC's list in Notice 701/21A, which HMRC updates from time to time. Coins not on the list can still qualify if they meet the tests above.

Supplies of investment gold are exempt, so a VAT-registered dealer adds no VAT. That covers the coins most UK buyers choose: Sovereigns, Britannias, Krugerrands, Maple Leafs and standard bars. Gold that fails the tests, such as jewellery, most 9 or 18 carat items and rare coins priced far above their gold value, is standard rated, so 20% VAT is built into the price.

The 180% test matters for collectors. A proof or rare coin selling at several times its melt value can fall outside the exemption. Check how a dealer treats a coin before you buy it as an investment. Our bullion vs numismatic coins guide explains the difference.

How is gold taxed when you sell?

Capital Gains Tax (CGT) is a tax on the profit, not on the sale price. GOV.UK explains it with an example: buy for £5,000, sell for £25,000, and the gain is £20,000. For gold, the gain is what the dealer pays you minus what you paid, including the premium over spot, plus allowable buying and selling costs.

Sources: HMRC CG78305, VAT Notice 701/21, GOV.UK Capital Gains Tax rates and personal possessions guidance. Checked 11 October 2026.

What are the CGT rates and allowance for 2026 to 2027?

GOV.UK confirms the annual exempt amount is £3,000 for 2026 to 2027 (the same as 2025 to 2026). Gains above that are taxed at:

• 18% on the part of your gains that fits within your unused basic rate income tax band.
• 24% on gains above that, and on all gains for higher and additional rate taxpayers.

Losses on chargeable gold can be set against gains on other assets in the same year, or carried forward if you report them to HMRC. A loss on a CGT-exempt Sovereign or Britannia is not an allowable loss, which is the flip side of the exemption.

Why are Sovereigns and Britannias free of CGT?

Because the law exempts sterling currency, and these coins are sterling legal tender. The HMRC Capital Gains Manual at CG78305 says "Sovereigns minted in 1837 and later years and Britannia gold coins are currency" and so are exempt under section 21(1)(b) of the Taxation of Chargeable Gains Act 1992, like any other sterling.

Three details from CG78305 catch people out:

1. Legal tender is tested at the time. "Coins are to be regarded as currency only if they are legal tender at the time of their acquisition or disposal." Pre-1837 Sovereigns do not qualify as currency.
2. Foreign currency is taxable. Non-sterling coins that are currency, "such as Krugerrands", are chargeable assets.
3. No chattels escape for foreign coins. "The chattels exemption does not apply to coins which are non-sterling currency."

The face value of a Sovereign is £1 and its gold is worth far more, but that does not change the treatment. It is why Sovereigns and Britannias often cost a little more than a Krugerrand with the same gold: you are paying for the tax status. HMRC names only Sovereigns and Britannias in this guidance, so ask an adviser before relying on the exemption for any other UK gold coin.

Worked example: Britannias vs Krugerrands

This example uses the Hatton Garden Metals buyback price for a 1oz Britannia from our GoldVetted price check, 10 October 2026: £3,067.15 per coin, when spot was £3,171.03 an ounce. The purchase cost is a round illustrative figure. Today's spot price is ... (Loading).

Imagine two buyers each paid £20,000 for ten 1oz coins some years ago. Buyer A bought Britannias; Buyer B bought Krugerrands. In 2026 to 2027 each sells all ten for about £30,670, has no other gains, and pays higher rate income tax.

Assumes the Krugerrand buyback price matched the Britannia price, no other gains or losses, and no selling costs. Buyer B's proceeds of more than £30,000 are below the £50,000 reporting trigger for those with no taxable gain, but Buyer B has a taxable gain so must report it anyway.

Buyer B could reduce the bill by selling some coins in one tax year and the rest after 6 April to use two annual exempt amounts, or by transferring coins to a spouse or civil partner (transfers between spouses are usually free of CGT) so both allowances are used. Buyer A has nothing to plan. See our guide to selling gold in the UK for buyback prices and our October 2026 premium report for what each coin costs to buy.

Is gold subject to Inheritance Tax?

Yes. The CGT exemption does nothing for Inheritance Tax. GOV.UK says there is normally no Inheritance Tax if an estate is below the £325,000 threshold, or if everything above it goes to a spouse, civil partner or charity. Above that, the standard rate is 40% on the part over the threshold. Gold coins and bars, at home or in a vault, count at their value on the date of death.

Two linked points. Gifts can be taxed if you give away more than £325,000 and die within 7 years. And when someone inherits gold, GOV.UK says the market value at the date of death is used for later CGT purposes, so the inheritor's eventual gain on bars or foreign coins is measured from that value, not from what the person who died paid.

When do you have to tell HMRC?

You do not get a CGT bill; you work it out. Per GOV.UK:

• If your taxable gains are above £3,000, report them on your Self Assessment return for the tax year of the sale, or, if eligible, through the real time Capital Gains Tax service by 31 December in the tax year after the sale.
• If you are in Self Assessment and sold chargeable assets for more than £50,000 in total, you must report the gains on your return even if they are under the allowance.
• Selling CGT-exempt Sovereigns and Britannias is not a chargeable disposal, so it does not count towards these tests.

Dealers do not send you a tax form, but under Notice 701/21 dealers in exempt investment gold must keep detailed records of their sales, and they carry out identity checks under anti-money laundering rules.

What records should you keep?

GOV.UK says to keep receipts, bills and invoices showing the date and amount you paid, any extra costs, and what you received, and to keep them for at least a year after the Self Assessment deadline (longer if HMRC opens a check). For gold, in practice that means:

• Dealer invoices for every purchase, showing product, quantity, price and date.
• Buyback or sale receipts.
• Bank statements proving payment.
• For inherited gold, the probate valuation.
• For coins you claim are CGT exempt, the invoice showing they are Sovereigns (1837 or later) or Britannias.

Keep copies away from the coins themselves. If you hold gold for decades, keep the purchase invoice for the whole time. For buying, storage and dealer comparisons, see our UK gold buying guide and the live premium tracker.

Not financial advice. GoldVetted provides general information to help you compare options. It is not personal financial, tax or legal advice. Gold prices go down as well as up, and you may get back less than you pay. Check tax rules with the official source or a qualified adviser before you act.