Covered in this silver buyers guide:
- Buying VAT free silver Coins in the UK
- How you’re probably paying too much for your silver
- Why buying silver from VAT restricted dealers isn’t always the best idea
- Where and how to re-sell your silver coins for the best prices
You’ve probably figured out that silver bullion has been an underpriced commodity, but how do you buy the precious metal at the best available price per ounce whilst minimising the dreaded VAT aspect of investing in silver bullion!?
Here’s CoinsUK quick buyers guide to help you discover how the retail silver trade works and how you can get a price advantage stacking silver bullion coins and bars vat freeAs a silver coin buyer myself, I have had those same frustrations “where to buy and sell at the best price”
Is VAT always charged on retail customers and the general public when buying silver bullion in Britain?
NO VAT is not automatically payable on all silver bullion purchases, it isn’t that silver attracts the VAT, it’s more a case that the larger retailers have to charge VAT on silver themselves, simply because they’re trading beyond a VAT threshold. Therefore the first thing we can do as retail buyers is shop around for coin dealers with smaller turn-over, perhaps part-time specialist silver re-sellers like CoinsUK, or private coin collectors who are totally free to sell their own silver without charging any added VAT.
Where to buy low cost VAT free silver
This is the reason why many coin buyers choose to re-sell their own coin collections on auction sites like ebay and ebid (ebid generally has lower sales fees & hence can also be a good place to find an occasional silver bargain!) The slight downside with auction sites can be the sales commissions of up to 10% plus Paypal fee’s which can bump up the sales costs for collectors and silver stackers.
Tips – advice for buying & selling silver bullion coins and bars
Top tip: A technique I’ve used myself whilst accumulating much of my own CoinsUK silver stock and special silver offers, net of any VAT and tax, is once I’ve found a good reliable, honest coin sellers who are reducing their own silver-stack, is to keep in regular contact and gradually make direct offers to buy their silver, perhaps agreeing a set rate, or a fixed rate over spot. Even paying say 20-25% over spot can result in finding a good source of VAT free silver, significantly lower priced than the UK retailers. Remember a retailer adds their coin re-sale premium on top of the Mint production and resale premiums, on top of which 20% UK Vat gets added, unless it’s a secondary market Margin scheme sale.
Why are the larger coin dealers & the UK Royal Mint so expensive to buy physical silver bullion coins from?
The simple answer is that A/ they have significant retail overheads to cover, typically larger premises to facilitate their staff, various taxes on premises, rates, insurances as well as staff costs, pension contributions etc etc plus of course the need to make a higher profit to justify their capital allocations. Smaller coin dealers, rural shops, work from home specialist collectors and private sellers are typically able to trade much more nimbly with lower fixed costs and of-course often under the threshold for which we have to add in the UK Govs 20% VAT rate!
UK VAT free silver coins from the EU
In recent years there has also been a rise in European dealers who are selling silver bullion coins on a EU VAT margin scheme at a reduced VAT & tax rate. Reduced VAT Margin dealers can be worth exploring especially if you are looking to buy significantly large volumes of bulk priced silver bullion, which is often needed to justify the extra costs of shipping and insurance from Europe. You will also need to consider any foreign currency exchange rate costs, typically UK Pounds Sterling to Euro. There’s also still going to be some element of added tax, relevant to the overseas retailer plus their profit margins on the retail silver coins as well as any post Brexit tax implications.
Simple solutions to saving money when buying silver bullion coins in the UK
A/ Search out private sellers – and negotiate their best price – deal directly person to person.
B/ Find smaller retail sellers, shops and online coin sellers – who are reducing silver stock and can sell without VAT
C/ Consider negotiating larger orders at a fixed price and pay a deposit to lock the silver rate, which is something that I’m always happy to look at with on my own silver sales
Why is paying VAT on investment silver not a good idea for private buyers?
Simple – you’ll never be offered the 20% VAT element back when you come to re-sell your silver to a VAT registered bullion dealer or scrap merchant!
Do an online search of the larger coin retailers including The number 1, 2 and 3 silver retailers! They’ll all typically offer you the net silver spot price per ounce with at best a small premium of perhaps spot +1%, maybe very slightly higher if it’s a scarcer coin, if you’re lucky! No matter how coin dealers phrase their buy-back offers, it’s still a signifiant loss if you’ve paid a 20% tax on your purchase! i.e. A dealer might say something like ‘we pay 100% spot plus 1%’ – it sounds good right!! wow – we get the whole 100% plus an extra %! In reality – the 99% or 101% is simply based on the industry spot price, NOT the VAT inclusive price.
Private coin collectors, silver stackers or small trade buyers do not suffer this pricing limitation and are therefore free to offer lower priced silver when selling PLUS higher buy back prices when you come to re-sell.
In the case of private silver buyers this is simply because in many cases a silver coin collector will happily pay a reasonable premium for certain silver coins which will still typically mean the coins are priced below a dealers vat inclusive price.
i.e – At CoinsUK I will often pay 15, 20, even 25% above the spot silver price to re-buy certain silver coins, which equates to a fairer trade deal all-round, for both buyer and seller. Selling your silver coins privately will also enable you to find coin collectors who are paying a higher price per ounce simply because they’re buying direct and cutting out the middle-man as well as the dealer and tax.
Are there any other ways to make buying silver in the UK cheaper without VAT?
Yes – coming soon! CoinsUK are launching our own CoinHubs to enable you to trade directly between buyers and sellers, with zero commissions, that’s zero % sales fees. This new facility launches in Autumn 2019, if you’d like to hear more and join CoinsUK CoinHubs, drop me a line – contact Steve at CoinsUK
As a fellow coin collector and silver stacker, I’ve experienced the same frustrations of where and how to buy fair priced silver bullion in the UK as well as “how and where to re-sell silver without paying high sales commissions and loosing the investment gain”!CGT Free is great – so long as you actually make a gain on your silver investment!
It’s ok that the UK Britannia 1 ounce £2 silver bullion coins are CGT free, but what advantage is “Free of Capital Gains Tax” if any gain has already been wiped out by the high purchase cost in relation to a net VAT sales price, less sellers fee’s!!
It’s for this reason – I’ve been working hard to help fellow coin collectors and silver investors get access to their very own Coin Hubs trading platform which they can use commission free, with unlimited buying, selling and trading, whilst also exchanging tips, information and the best buy prices directly between buyer and seller – ‘cut out the middle man’. CoinsUK – Coin Hubs will also be incorporating lots of new facilities to make the whole process of buying and selling silver bullion coins and bars a simple, fair, safe and trusted experience in the UK as well as the USA, Canada, Australia – as we expand the facilities to coin sellers Worldwide.
Be the first to find out more about lowering your costs to buy / sell and exchange silver at CoinsUK: email@example.com
UK silver coins benefiting from lower direct peer-to-peer re-sale costs; Pre-1920 .925 Sterling silver, Britannia collectable .958 silver coins, Britannia £2 1 ounce 999 silver bullion, Royal Coat of Arms 999 silver 2019 silver bullion coin.
Pre-owned and margin scheme secondary coin sellers: The British Government have a Margin scheme whereby dealers can re-sell coins that are not legal tender coins in the UK. Many non UK minted Legal Tender coins can be sold in the UK on the VAT margin scheme whereby the dealer will pay VAT on the profit margin, these types of coin sales are often good value, although at times hard to find in reasonable quantities! typical coins which we’d see come up for re-sales on a margin scheme include; USA American Eagles, Canadian Maple-Leafs, Kangaroos, legal tender 1oz coin bars, Mexican Libertad,
Finding dealers who will happily re-sell second hand silver on the UK margin scheme can be a good source of cheaper priced silver bullion coins and bars. In theory many of the UK Royal Mints silver bullion coins would not be applicable for the margin scheme since they are in fact classed as Legal Tender – i.e the UK Britannia is Two Pounds Sterling and Legal tender for the sum of £2 – all be it, non circulating. Having said that, the Britannia and coins like £5 Queen’s Beasts do still occasionally come up for sale on the reduced tax Margin scheme for secondary sale silver! Off-course if you buy your silver privately or from a dealer who isn’t required to be registered for charging VAT – you will not need to pay any VAT at all, not even the VAT on a profit margin, because VAT just won’t be applicable, that’s the significant benefit of buying silver from smaller retailers and private re-sellers.
If you’re a UK bullion dealer or re-seller offering cheap fair priced silver, or using the margin scheme and would like to offer your silver direct to UK CoinHubs buyers, we’d like to hear from you; contact Steve at CoinsUK
A fair trade place to buy and sell silver coins – CoinsUK SilverHubs – The platform for Silver Appreciation
Private re-sellers of silver bullion and collectors coins looking to get the best prices, sales commission free for your silver, can also register your interest and be amongst the first to get free access to our CoinsUK Sales Hubs.