Capital Gains Tax on Gold
UK legal tender coins are exempt whatever the gain. Bars and foreign coins are not. Exactly what qualifies.
This is the single biggest advantage available to a British gold buyer, and it is widely misunderstood. The exemption is real, it is unlimited, and it applies to a narrower set of coins than most people assume.
The rule
Coins that are UK legal tender are exempt from Capital Gains Tax for UK residents. The exemption exists because they are currency, not because they are gold. It applies however large the gain, with no cap and no allowance to use up.
What qualifies
Every size of Gold Britannia and every size of Gold Sovereign — half, full, double and quintuple — along with the Royal Mint's other legal tender bullion coins such as the Tudor Beasts, the Queen's Beasts, the Lunar series and the Myths and Legends range. If the coin carries a sterling face value struck by the Royal Mint, it qualifies.
What does not
Gold bars of any size or refiner. They are not legal tender and never qualify.
Foreign coins — the Krugerrand, Maple Leaf, American Eagle, Philharmonic, Double Eagle and so on. They are still free of VAT as investment gold, but a gain can be liable for CGT.
Why it matters more than premium
British legal tender coins cost a little more per gram than a large bar. On a holding that appreciates and is later sold, the exemption is usually worth considerably more than the premium saved. This is why most UK private holdings are built on Sovereigns and Britannias rather than bars.
The practical order
Take the exempt coins first. Add bars or foreign coins afterwards, once the tax-efficient part of the holding is in place.
General information, not tax advice. Tax treatment depends on your individual circumstances and may change. Speak to an accountant about your own position.