Tax on Gold in 2026

Tax on Gold in 2026 — Capital Gains Tax, VAT and How to Buy Gold Tax-Free in the UK

Author: Paweł Kucharzak, Precious Metals Specialist, GoldInvest24 | 3 June 2026
Reading time: 8–9 minutes | Updated: June 2026

You buy a Gold Sovereign for £480. Three years later you sell it for £720 — a profit of £240. Do you owe Capital Gains Tax? No. Not a penny, and not because the gain is small — the Sovereign is entirely outside the CGT system regardless of how large the profit is. That single fact makes it one of the most tax-efficient physical assets available to UK residents. This guide explains the complete tax treatment of gold in the United Kingdom — VAT on purchase, Capital Gains Tax on sale, the CGT exemption for Royal Mint coins, and a comparison with the rules in Germany and Poland for readers considering a cross-border purchase from GoldInvest24.

Capital Gains Tax on gold — the core rules

Physical gold — bars, coins, and jewellery — is classified as a chargeable asset for CGT purposes under the Taxation of Chargeable Gains Act 1992 (TCGA 1992). When you sell gold at a profit, the gain is potentially subject to CGT. The applicable rates for the 2025/26 tax year are 18% for basic-rate taxpayers and 24% for higher and additional-rate taxpayers.

Every individual has an Annual Exempt Amount (AEA) — effectively a tax-free allowance for capital gains. For the 2025/26 tax year this stands at £3,000 (reduced from £6,000 in 2023/24 and £12,300 in 2022/23). Gains below this threshold are tax-free but may still need to be reported if total disposal proceeds exceed £50,000 in the tax year.

Unlike Germany (12-month holding period for tax exemption) or Poland (6-month holding period), the UK has no general holding-period exemption for gold. A gold bar held for twenty years and sold at a profit is subject to CGT just as much as one held for twenty days — unless it qualifies for a specific exemption.

The Sovereign and Britannia exemption — CGT-free gold

This is the single most important tax rule for UK gold buyers. Gold coins that are — or have been — legal tender of the United Kingdom are exempt from Capital Gains Tax under TCGA 1992, s. 21(1)(b). The statute provides that sterling currency is not an asset for CGT purposes. Since Gold Sovereigns (minted 1837 onwards) and Gold Britannias carry a face value in pounds sterling and are issued by the Royal Mint as legal tender, any profit from their sale is entirely outside the scope of CGT.

Key points about this exemption:

No limit on the gain — whether you make £500 or £500,000 in profit, the exemption applies in full. There is no cap, no taper, and no annual limit.

No holding period — the exemption applies from the moment of purchase. You could buy a Sovereign today and sell it tomorrow at a profit with zero CGT liability.

No reporting obligation — gains from CGT-exempt assets do not need to be reported to HMRC, regardless of the amount. They do not count towards the £50,000 disposal proceeds reporting threshold.

Applies regardless of where the coin was purchased — the exemption is based on the coin's status as UK legal tender, not on the place of purchase. A Sovereign bought from GoldInvest24 in Poland carries the same CGT exemption as one bought from the Royal Mint in Llantrisant.

Which coins are CGT-exempt — and which are not?

The exemption is straightforward: if the coin is struck by the Royal Mint and carries a sterling face value, it is CGT-free. All other gold — foreign coins and all bars — is a chargeable asset.

VAT on gold — investment gold is zero-rated

Investment gold is exempt from Value Added Tax in the United Kingdom. Following Brexit, the UK retained the VAT exemption that was originally established under EU Council Directive 2006/112/EC (Articles 344–356) and implemented domestically through the Value Added Tax Act 1994, Schedule 9, Group 15.

The exemption covers gold bars with a fineness of at least 995‰ and gold coins minted after 1800 with a fineness of at least 900‰ that are or were legal tender in their country of origin and whose selling price does not exceed 180% of the gold content value. This includes Krugerrands, Maple Leafs, Britannias, Sovereigns, Philharmonics, Kangaroos, American Eagles, and Pandas.

Silver, platinum, and palladium are subject to VAT at the standard rate of 20%. This is one of the key reasons gold — specifically in the form of Sovereigns or Britannias — offers unmatched tax efficiency for UK buyers: zero VAT on purchase, zero CGT on sale.

Tax comparison — UK vs Germany vs Poland

*In the UK, Sovereigns and Britannias are CGT-exempt with no holding period and no limit on gains. Gold bars and foreign coins (Krugerrand, Maple Leaf, etc.) are subject to CGT above the £3,000 AEA. Germany and Poland offer time-based exemptions that apply to all forms of physical gold equally.

The UK system creates a clear optimal strategy for tax-conscious buyers: concentrate holdings in Sovereigns and Britannias for complete tax exemption, regardless of holding period. For buyers who prefer larger denominations or international coins, the £3,000 AEA still provides meaningful shelter — but above that threshold, a Krugerrand profit is taxable while an equivalent Sovereign profit is not.

Practical strategies for tax-efficient gold ownership

Prioritise CGT-exempt coins — For UK residents, Sovereigns and Britannias should form the core of any physical gold holding. They combine VAT exemption on purchase with complete CGT exemption on sale — a double tax advantage that no other physical asset class offers. The Half Sovereign (3.99 g fine gold) provides an affordable entry point; the full Sovereign (7.32 g) and 1 oz Britannia (31.1 g) suit larger allocations.

Keep records of every purchase — Even for CGT-exempt coins, retain purchase invoices as proof of ownership and provenance. For non-exempt gold (bars and foreign coins), the invoice establishes the acquisition cost used to calculate your gain. HMRC may request evidence if you report significant disposal proceeds.

Use the AEA strategically — If you hold non-exempt gold, plan your sales across tax years to maximise the £3,000 annual allowance. Selling £3,000 of gains in March 2027 and another £3,000 in April 2027 (a new tax year) shelters £6,000 of gains that would otherwise attract CGT.

Consider spousal transfers — Transfers between spouses or civil partners are not disposals for CGT purposes. If both partners have unused AEA, transferring gold bars before sale can effectively double the tax-free allowance to £6,000 per year.

Diversify with silver for tactical allocation — While silver carries 20% VAT and has no special CGT exemption in the UK, it benefits from the same AEA as other assets. For buyers with a higher risk tolerance, silver bars and coins offer higher volatility and potentially greater percentage gains — useful when the gold/silver ratio suggests silver is undervalued relative to gold.

FAQ — Common questions about gold tax in the UK

1. Do I pay VAT when buying gold?

No — investment gold (bars ≥995‰ and coins meeting the qualifying criteria) is exempt from VAT in the United Kingdom. You pay the net price with no added tax.

2. Are Gold Sovereigns really tax-free?

Yes — Gold Sovereigns (minted 1837 onwards) are exempt from Capital Gains Tax under TCGA 1992, s. 21(1)(b) because they are sterling legal tender. There is no limit on the gain, no holding period requirement, and no reporting obligation to HMRC.

3. Are Krugerrands subject to CGT?

Yes — the Krugerrand is South African legal tender, not British. Gains above the Annual Exempt Amount (£3,000 in 2025/26) are subject to CGT at 18% or 24%. The same applies to Maple Leafs, Philharmonics, Kangaroos, and all other non-UK coins.

4. What is the Annual Exempt Amount for gold CGT?

The AEA for the 2025/26 tax year is £3,000 per individual. This covers all capital gains combined — not just gold. It has been reduced significantly from £12,300 in 2022/23, making CGT-exempt Sovereigns and Britannias increasingly valuable for UK investors.

5. Do I need to report gold sales to HMRC?

For CGT-exempt coins (Sovereigns, Britannias, other Royal Mint legal tender) — no, never. For non-exempt gold, you must report if your total taxable gains exceed £3,000 or your total disposal proceeds across all assets exceed £50,000 in the tax year.

6. Is there a holding period for tax-free gold in the UK?

No — unlike Germany (12-month Spekulationsfrist) or Poland (6-month holding period), the UK has no time-based exemption for gold. The only route to CGT-free gold ownership is through qualifying UK legal tender coins. Bars and foreign coins are subject to CGT regardless of how long you hold them.

7. Can I buy CGT-exempt Sovereigns from an overseas dealer?

Yes — the CGT exemption is based on the coin's status as UK legal tender, not on where it was purchased. A Sovereign bought from GoldInvest24 carries the same legal tender status and CGT exemption as one bought from any UK dealer. The exemption applies to all Sovereigns minted from 1837 onwards.