Silvs

I thought that was the case. Thanks.

Is this forum still buying in bulk from this place?

4 minutes ago, BackyardBullion said:

Only if HMRC deem you to be a business. 

To be honest, if you are just buying silver as an investment then you don't need to worry about this. 

If you are planning to buys silver and then flip it quickly for a profit over and over, then you are a business

Thank you so much.

2 minutes ago, BackyardBullion said:

The £1000 is only if you are deemed to be a micro business rather than someone just selling their assets

OK. So it WON't apply unless they deem me to be a micro business? However, I will need to register it with HMRC if I sell silver and within a given tax year I receive in excess of £1000 from this?

3 minutes ago, BackyardBullion said:

I do indeed run Backyard Bullion as a business and YouTube channel. We don't take any commission for the group orders. All the information is in the thread I linked to!

I have to add I am little confused about the £1000 profit tax while selling silver. Why do I not have to worry about this so much but I do have to worry about the CGT? £1000 is a much lower number than £12000+. Is there any reason for this please and do you know what % of tax I would have to pay? Apologies for all the questions! 🤪

6 minutes ago, BackyardBullion said:

Yes, it is only applied to coins, not bars. This is pretty similar throughout Europe.

I have never used celticgold, so I don't know about their particulars regarding VAT on deliver, sorry!

I can only recommend the EU mint as they are my supplier and a company we have used here on the forum for many years. 

Yes I have just recognized that after watching your video on YouTube. Just to be clear: Do you run BackyardBullion and is the European Mint your primary supplier? Will it cost me any more money to buy European Mint Silver on this forum then if I did it directly (I know you said no commission on the video but I just want to check everything). Trying to work through this and I'm at the point where I've got more questions than answers! 😂

https://buysilvercoins.eu/bullion-vat-information Buillion gold is free too?

2 hours ago, BackyardBullion said:

Tax is a very difficult area, so here is a rough guide for new stackers. 

The following is NOT tax advice, just my understanding on how things work. 

I would recommend you seek advice from a qualified professional or contact HMRC if you want a definite answer.

Taxes relating to silver can be looked at in 2 main categories. Taxes when you buy and taxes when you sell. 

Taxes when you BUY

When you buy you pay the vendor whatever their VAT rate is. If you are in the EU and import it to the UK at this current time there would be no extra taxes or anything. It is as if it was sold by a UK vendor for customs purposes. Seems strange I know, but Estonia is a very unique place for VAT rules on Silver. 

That is about it for Taxes on purchases - if you buy from someone outside the EU there WILL be taxes applied on goods over £10 in value at the border. So don't buy from the USA that will sting. 

Taxes when you SELL

This can be broken down into a few categories: 

Capital Gains Tax (the most applicable)

Income Tax

Registering for and charging VAT on sales

Capital Gains Tax

Capital Gains Tax is a tax levied on profits individuals make when they sell assets. Each person has an allowance of £12,300 PER YEAR of tax free capital gains profit. If you make a profit underneath this threshold you do not have to declare any of it, you just crack on with life. If you make more than this you need to declare it on a self assessment tax form. 

Nice perk - if you are married then your spouse can also use £12,300 worth PER YEAR meaning a married couple can make £24,600 before having to even declare a penny. 

Any taxes due are on profits above the threshold. So an idividual that makes £12,500 profit IN A SINGLE YEAR will need to declare all £12,500 but will only pay tax on the £200 excess from the £12,300 free allowance. I forget what the CGT rates are - but they are dependant on what tax band you are in. 

Capital Gains Exempt Items. UK coins are capital gains exempt. So if you sell and make profit on (list not exhaustive) Britannias, Queens' Beasts, Sovereigns or any other UK coin then you do not need to add it to your calculations for CGT. 

An example as follows: 

You buy £20,000 worth of silver and gold. £5,000 of it was in the form of a gold bar (not capital gains tax exempt), the rest in Britannias (which are Capital Gains Tax exempt). 

You sell the whole lot for £40,000 in one year. You have made a profit of £20,000 - doubling your money!

When you look at the calculation it works out as such: 

Gold Bar: £5000 profit (doubled your money)

Britannias: £15,000 profit (doubled your money)

Your total CGT profit is only £5000 as the britannias are exempt.

If you reverse that and had £15,000 in gold bars (non CGT exempt) then:

Gold Bar: £15,000 profit (doubled your money)

Britannias: £5,000 profit (doubled your money)

Your CGT calculation is £15,000 profit and you have to declare it. Unless you are married in which case you can transfer some of that profit into your spouses allowance. 

Remember that these calculations are done PER TAX YEAR

So you can in theory spread things out and play with your allowance. 

INCOME TAXES WHEN SELLING SILVER

If you buy silver to sell regularly as a hobby or small business and your turnover is more than £1000 per year you need to register with HMRC for self assessment tax and declare these profits. You will then have to pay income tax on any profits over £1000. 

There are a few "Badges of Trade" that HMRC will look at to determine if you are a business seller rather than just a private individual selling your personal investments. 

More info on these can be seen here: https://www.gov.uk/hmrc-internal-manuals/business-income-manual/bim20205

Bottom line, if you buy in bulk on the cheap and sell regularly for profit having owned the coins for a short time and with the sole intention of making a quick profit then HMRC might think you are a business and demand you pay Income Tax. Another badge is if you borrow money to make the deal. 

VAT on SELLING your silver

VAT is applicable to all silver sales. However individuals disposing of their silver assets are not registered for VAT so no VAT is applicable. However, if you are deemed to be operating as a business or sole trader (like with the income tax section) and your TURNOVER on silver exceeds £85,000 per year then you will be required to register for VAT and you will then HAVE to charge VAT on your sales. It is important to remember this is calculated from your TURNOVER not PROFITS and when selling silver that can add up quickly.

These last two points you don't really need to worry about because they are more applicable to people who buy and sell as a hobby/extra income micro business. 

If you are just investing in silver as a private individual there are not many things that need to be accounted for other than profits greater than the CGT free threshold. 

If you are worried about CGT then just stick to UK coinage and you won't ever have to worry about it!

Hope that helps!

 

Wonderful! I am trying to get through to HMRC but it's a bit difficult at the moment! I was not aware of the £1000 tax thing so thank you for that. Do you think these guys could potentially ship me some VAT free silver: https://www.celticgold.eu/en/gold-university/vat-silver-europe.html I've also noticed that VAT free silver only applied to buillion coins in Estonia, not bars.

13 hours ago, BackyardBullion said:

Who knows after the end of the transition - that is dependent on future trade relationships

If you buy from EU mint right now there are no extra taxes to bring into the UK.

I don't know the VAT status of ROI but if it remained in storage no taxes would apply at all.

So technically you could get silver cheaper - but my earlier point still stands - you would not have it physically and you would be completely at the mercy of the dealer and their buyback prices. Not to mention the worries what would happen if they went bust or closed their business.

If you don't hold it you don't own it. Just numbers on a screen.

So just to be clear, if I buy silver from the EU and ship it in to my home address, I don't pay any tax? Then I can sell with no tax applied (I assume EU silver is not CGT free).

So just to be clear, if I buy silver from the EU and ship it in to my home address, I don't pay any taxes currently?

2 hours ago, BackyardBullion said:

At this current time VAT is applied to all sales of silver in the UK (assuming the retailer is big enough to have to register for VAT). 

Also at this current time the UK is on the transition period with the EU and therefore freedom of movement for goods bought applies. No additional VAT or taxes to be paid assuming you paid the VAT to the seller in question in the country you bought it. 

So the information that you can buy VAT free from ROI is probably for storage rather than delivery - when the ROI company has to deliver they have to charge VAT. 

There are countries that have less rates of VAT - Belgium, Germany and Estonia. Estonia being 0%

So, for the time being you can order from these countries and import into the UK with no extra taxes. The only problem is you have to order in enough bulk to make the shipping worth while.

We have been and are currently helping with group orders to reduce these costs here is the thread to find out more!

Hope that answers your questions! 

 

That's fantastic info. What happens once we have left the EU? Do different VAT rules apply. If I buy silver from Estonia and get it shipped to UK, do I have to pay VAT then? 

Yes it was for storage - it just seemed a bit too good to be true that I could aviid VAT entirely at either selling or buying provided I avoided the UK. For example, would I have to pay taxes in ROI? 

Hello,

I have just been in touch with the Royal Mint and they have informed me that all silver that is bought in the UK includes VAT, but there is no VAT on any silver sales. I have also been informed by a buillion dealer in ROI that if silver is stored outside the UK, it will remain VAT free provided it is never bought to the UK. Is anyone aware if this second part is true or if this is nonsense? I'm honestly unsure and I am a bit skeptical because it is a dealer but it may be the case. Can anyone please clarify?

Thanks in advance,

Silvs.