Exemption ― investment gold and gold coins

Produced by Tolley
Exemption ― investment gold and gold coins

The following Value Added Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:

  • Exemption ― investment gold and gold coins
  • What is investment gold?
  • Exemption
  • Notifying HMRC
  • Opting to tax
  • Reclaiming input tax
  • Invoicing
  • Issuing invoices
  • Invoice information
  • Record keeping requirements
  • More...

IP COMPLETION DAY: 11pm (GMT) on 31 December 2020 marked the end of the Brexit transition / implementation period entered into following the UK’s withdrawal from the EU. At this point in time, key transitional arrangements came to an end and significant changes began to take effect across the UK’s VAT and customs regime. This document contains guidance on subjects potentially impacted by these changes. Before continuing your research, see the Brexit — overview guidance note.

This guidance note provides an overview of the VAT treatment of supplies of investment gold and gold coins. For supplies of non-investment gold see the Supplies of non-investment gold guidance note for more information.

See the Flowchart ― is the supply of gold within the scope of UK VAT? for further assistance on determining the correct VAT treatment of the transaction.

A special VAT scheme is applicable to supplies of investment gold. The scheme is intended to put investment in gold on a similar footing to other financial investments, such as shares, by making it exempt from VAT. Businesses are normally unable to reclaim input tax directly attributable to an exempt supply. Since gold may be purchased from a variety of taxable sources before being transformed into investment gold, VAT may be incurred on the purchase. If the normal rules applied, the input tax incurred on the cost of purchasing the gold would not be reclaimable and the seller would either have to absorb the VAT cost or pass it on to the investor which could make investing in gold less attractive. The investment gold scheme has three special features:

  1. certain persons may opt to tax specified transactions which will enable them to reclaim all of the related input tax (subject to the normal rules)

  2. VAT registered businesses can reclaim the input tax incurred on purchases of gold and on the costs of transforming any gold into investment gold

  3. VAT registered businesses who are producers and transformers of investment gold

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