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Silvs

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  1. Like
    Silvs got a reaction from James32 in European Mint   
    I thought that was the case. Thanks.
  2. Like
    Silvs reacted to James32 in European Mint   
    Due to brexit,its no longer feasible and vat will be added at entry to UK.
  3. Like
    Silvs reacted to StackerNoob in VAT on Silver in the UK   
    No VAT on gold in the UK, so its often worth buying from a UK based seller for gold.
  4. Like
    Silvs reacted to BackyardBullion in VAT on Silver in the UK   
    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!
     
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