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Guide to buying low priced Silver bullion

britannia 1oz silver bullion coins vat free

Covered in this UK silver buyers information guide:

  • Buying 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
  • What are the pro’s & cons of buying silver
  • Where and how to re-sell your silver coins for the best prices

Information sharing disclaimer; CoinsUK share our own experience and opinions, we do not offer personal investment advice.

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 VAT aspect of investing in silver bullion!? 

Here’s my CoinsUK buyers guide to help you discover how the retail silver trade works and how you can get a price advantage buying silver bullion coins and bars vat free

As a silver coin buyer myself, I have had those same frustrations “where to buy and sell silver bullion coins at the best price?”


* Post Brexit 2022, almost all European sales are now attracting VAT when imported into UK, as well as the increased transport, courier/customs fees and extra dealer costs – resulting in significantly higher silver prices. Demand is also heightened for all silver bullion products.

The most cost effective method of buying physical silver coins is almost certainly buying from private sellers who are selling through the secondary market.

Updated 2022; The silver bullion market is becoming very tight on supply side which has resulted in higher demand and an increase of both spot silver prices and resulting coin sale premiums.
The most effective way to locate fair priced silver coins and bullion, Currently in UK, is to trade directly with private sellers, or locate smaller coin re-sellers who have older stock which they may be prepared to sell at lower premiums closer to spot pricing. Note however that silver almost always commands a premium over the international spot price.

buying & selling silver bullion coins and bars

How the coin trade pricing works; Silver coin retailers add a coin re-sale premium on top of the Mint production and resale premiums, on top of which 20% UK Vat is also added, unless the coins are being sold through a secondary market Margin scheme, in which case the tax is paid on the sellers profit margin.

Sourcing reasonable quantities of silver bullion from UK margin scheme sellers can be a time consuming challenge, especially at times of bullion price appreciation because there simply isn’t a lot of quality silver coins and bars coming onto the second hand market. Linking buyers directly with silver sellers on the secondary silver market is something I am actively engaged with to help silver investors find reputable sources for accumulating silver bullion at fair trade prices.

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 and wage 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!

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.
CoinsUK SilverHubs section also offers a facility to re-sell your silver using our site, where you can buy and sell silver and gold coins directly.

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 rarely be offered any of 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. 

Private silver buyers tend to pay a reasonable premium for good silver coins which will still typically mean that the coins are priced below a dealers vat inclusive price.
i.e – At CoinsUK I will often pay 10 to 20% 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 the Britannia coins legal tender and CGT free? what’s the benefit of buying British Mint issued silver coins? CGT Free is great – so long as you actually make a gain on your silver investment!

The Britannia one ounce silver coin as minted by the UK Royal Mint is legal tender for it’s face value of £2 (two Pounds Sterling) Legal tenders true meaning is that the coinage can be used to pay debts or fines in a UK Court! It does not mean that banks, post offices or shops are obliged to accept these coins for payment. Likewise it does not mean that we can’t use the value contained within the precious metal of the coins to trade them ourselves for goods or services at their derived or intrinsic value should we wish to.

Britannia bullion coin view

The face value of a Britannia 1oz coin is two Pounds, although the market value far exceeds this and is determined by; A/ The silver spot price plus a premium for production, mintage, delivery and selling costs. B/ The intrinsic value, or any premium assigned by the buyers perceived value.

Do CGT free silver coins make better coin investments? The UK Britannia coins legal tender nominal value means that the 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. Remember that to first benefit from any CGT advantage, you first have to make a gain!!

It is also worth exploring your own liability to Capital gains and current tax rules before you go rushing to simply buy British minted Britannia silver coins. If indeed you aren’t going to use your current CGT free allowance, you may well benefit more by buying coins with greater collector appeal as well as similar or lower premiums than the Britannia. Good examples of investment bullion coins include the newer South Africa Mint Krugerrand and the increasingly desirable more limited issue 1oz silver Dragon bars which are minted by the Perth Mint and are also authenticated legal tender coins with a $1 face value.

Generally speaking CGT free is not always a significant benefit, if any benefit at all! to UK buyers who would not be using up their current Capital gains tax free allowance. (always seek advice and do your own research if in doubt about your own tax situation)

There are increasingly vocal counter arguments to the UK Royal Mints assigned Legal tender status to certain coins and their counter move of giving coins with a much lower actual precious metals content – an actual higher ‘legal tender amount’ At face value coins like the £50 silver might look to be good value and many UK buyers have been fooled and annoyed to subsequently discover that no-one will actually accept these coins at face value! because they are not actually ‘circulating legal tender’ which is something the Royal Mint conveniently seem to omit from their sales promotions! A further downside is that the actual precious metal content – pure silver bullion is exactly the same as the £2 Britannia!

What looks the best value – a RM coin sold for £50 containing 1 ounce of silver or a £2 Face Value Britannia currently retail at under £20 each, also containing the same 1 ounce os silver!?

Silver certainly looked to be undervalued at mid 2019 prices with extreme gold to silver ratios, however it’s still important be do your research and aim to buy fair priced silver coins without added VAT and then look to establish a plan for re-selling the coins easily without dealer or sales commissions.

World events are creating increased demand for sound money, physical silver and gold. At the same time as physical supply is being constrained by mine closures, delays getting ore to refiners as well as depleting wholesale bullion supply. In the case of the thinly traded silver market, we may well be moving towards a situation whereby silver bullion coinage simply isn’t available to wholesale or retail dealers. Trading coins p2p (person to person) might prove an even more attractive solution to acquiring silver. It might well prove the only solution!

SilverHubs trade silver coins & bullion

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 and more recently the limited issue Perth Mint Dragon $1 coin bars.

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.

Further reading; How to sell silver bullion and silver coin collections at a fair price

I hope you found the silver insights useful.

CoinsUK does not offer professional investment advice or personal investment advice, and strongly encourages all readers to consult with their own personal financial advisors before making any investment decisions.

All content and personal opinions © Steve Hotson, CoinsUK, 2020-2022

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How to buy silver coins in UK

silver bullion uk coins

Latest update
2022 – business / web site and collections are being offered for-sale.

All information contained herein is editorial, experience and opinions, it should not be ascertained as personal investment advice. Our primary business is assisting private and trade purchases or sales of silver coins and bullion here in the UK. Since we are not affiliated to any one commercial organisation, nor do we sell large quantities of silver ourselves, we are free to report on and assist you with all aspects of the silver trade.



2020 Britannia 1 ounce silver bullion coins Physical coins which you own in your possession. Britannia £2 silver coins are legal tender in the UK and is therefore Capital Gains Tax Free, CGT Exempt. The UK Mint Britannia coins contain one Troy ounce of fine 999 silver bullion.

A cautionary note regarding VAT free silver coins for storage outside the UK: Personally, I would be cautious of the value and investment potential offered by bullion dealers who are providing ‘vat free silver coins for overseas storage‘ or ‘reduced premium silver coin prices’ for allocated overseas storage. This form of holding silver means that you do not physically have possession of the silver bullion coins yourself. Hence when you want to re-sell the silver coins you are:

A/ restricted who you can re-sell the silver to, meaning you’ll probably only get close to spot price, loosing most if not all of any premium you’ve paid for coins.

B/ If you want to actually take physical delivery of the silver bullion coins so that you can re-sell on the open market, you may then incur the additional 20% VAT if you want to take actual delivery and ownership in the UK, plus shipping cost! see notes below for more information.

Silver stacking context: As a fellow silver bug and silverstacker I have compiled useful information learned from my own experiences collecting silver bullion coins and bars since 2009 when I purchased my first significant batch of Sterling 925 silver bullion coins. More silver stacking followed in 2011, although with silver doubling in price from around £10 per ounce to over £21 per ounce, I was then paying around £29 per ounce for the China Mints 3-999’s silver Panda coins to join my existing collections of older pre-1920’s .925 Sterling silver.

2014 experienced good silver bullion demand and historically low spot prices with further purchases of VAT free silver; the 2014 limited issue privy editions £2 bullion Britannia which the UK Mint initially released to the VAT free USA and European wholesale bullion trade and wholesale coin markets.

In 2011 with silver at £21 / $27 per ounce – there was strong interest and growing demand for real physical silver bullion. What followed was almost constant short selling of paper derivatives and paper futures contracts on the comex market which constantly drove the spot silver price back towards the £10-£13 ($13-$16) levels, ultimately creating another unique opportunity to accumulate physical silver at historically attractive prices.

My Silver price predictions for 2020 – 2021price guesstimates are just a personal target!
Silver prices in 2020 look to be resuming the physical silver bull market as prices re-break the trend line and cleared $16.80 – there’s a lot of clear chart space above for silver to re-gain a more respectable 80/1 ratio and longer term targeting historical silver/gold ratios silver would still represent good value compared to it’s physical mining ratio which is around 11/1.

At $1500 gold – a relatively modest 70/1 ratio makes silver valued at over $21 per ounce.
With silver mined and found naturally in the ground at a ratio of 11/1 – I believe we will once again eventually see physical silver bullion trade over its $50 previous high.

I

With the growing popularity of the newer .999 pure silver bullion coins It can appear a complex market when it comes to sourcing these silver bullion coins in GB at a fair price in relation to the silver spot price and that’s before UK dealers add in their selling margins and the VAT! Buying silver bullion coins from dealers with secondary market lower taxed silver, dealers in lower tax jurisdiction locations or even better directly from fellow private silver investors who are looking to sell directly is usually the best way to find the lowest costs per ounce.

Buying silver bullion coins at best per ounce prices

Tip No.1 – keep it simple, trade direct, deal with trusted sellers with reliable reputations supplying fair priced silver bullion coins. Silver is a natural element symbol Ag. which has performed a perfect role as a natural, reliable, trusted form of money for over 4000 years, enabling people to conduct trade directly between buyer and seller, person to person. Aim to eliminate as much of the supply chain and complexity from buying your silver coins as possible and you’ll discover how to lower your overall silver costs per ounce.

Tip 2. Silver Premiums always disappear with time, in the long run most value investors tend to price silver in relation to the spot market bullion price plus a reasonable coinage premium. Unless the coins are really scarce and sought after, the lower the initial premium bullion you pay, the higher your gain on resale. As a general rule you will make more money on silver bullion from buying coins as close to ‘bullion spot’ as possible, than simply hoping that a huge rally in silver prices will help you recover higher priced, taxed premium coins.

Britannia 2 Pounds .999 fine silver bullion coins

The silver market has evolved a lot over the last 10 years with plenty of new releases joining the pure 999 silver scene! I’ve got some exciting projects underway to help fellow silver-stackers gather accurate up to date information as well as share my insights into buying silver at the best possible prices whilst always keeping a fine eye on what to buy and just as importantly how and where and to re-sell your silver coin investments without loosing a good proportion of your investment to taxes, commissions and selling fees!

2022 Silverhubs

As we develop CoinsUK SilverHubs further, there’s lots of silver knowledge and trading tips that I’m alway happy to share and help fellow UK coin buyers with, as more than ever in 2022 the silver bullion market has huge choice and price variation. The good news is that it really doesn’t need to be complicated, keep things simple, gather and share trusted information, experience and sales facilities – all things I’m working hard to share whilst I work with both the silver industry and retail to improve silver’s appreciation and hopefully a steady return to more awareness for silvers true role as the ultimate global ‘sound money’ and store of value.

UK Royal Mint CGT free Britannia fine .999 silver bullion 2 pounds coin

UK Mint Britannia £2 silver bullion coins

COINSUK offer you a fast assured low cost source for your UK silver bullion coins. We have bulk silver bullion available for fully insured, free next day delivery. Assured quality checked and official Mint distributor sourced silver bullion coins.

Taking delivery of physical silver bullion saves storage costs & counter-party liabilities

There’s a saying in precious metals forums – “If you don’t hold it – you don’t own it!”
Whilst the lure of VAT free offshore stored silver coins and bars sounds appealing, it usually comes with a couple of significant catches; 1. There’s a monthly storage fee & 2. If you ever want to physically get hold of your silver in times of financial turmoil, they’ll be extra shipping costs as well as any relevant vat and taxes to pay once you opt to take delivery. Most ‘allocated platforms’ also have fees or a buy/sell spread.

The simplest, safest way to buy and hold silver bullion is to buy popular internationally recognised Minted coins which are easy to re-sell, small units of easily tradable silver like Britannia, Krugerrands, Dragon bars etc. Buy from a non registered or VAT free seller and take physical ownership at the lowest cost per silver ounce you can secure.