Our Cheapest 1oz Silver Bars

[ChardsCoinandBullionDealer]

We've added Our Choice 1 oz Silver Bars - they're sold on the special scheme so you'll only pay VAT on the dealer's margin. They are still in the protective packaging. We have limited stock so if anyone is interested you will have to move quickly https://www.chards.co.uk/1oz-silver-bars/silver-bullion-bar/3242

If anyone is looking for 1 kilo bars - we have Metalor 1kg sold on the special scheme - you will save approx £40 against the new bar. https://www.chards.co.uk/silver-bars/one-kilo/metalor-secondhand-silver-bullion-bar/792

Let me know what you think.

Lizzie

[Pete]

Just a bit confused on this VAT topic.

I always believed that VAT on secondhand silver was actually 0% ( i.e. zero rated ) but in the UK our dealers elect to apply full VAT at 20%.

Up until several years ago, Germany had a reduced rate of VAT on silver coins ( and coin bars ) but NOT on silver bars.
From memory the VAT on coins was only 7% but on bars 19% as it still is today.
When the authorities changed the rules, the VAT on coins became 19%, so the dealers found the loophole of the differential VAT scheme only charging VAT on their margin.
This meant the EU dealers kept their prices much lower than the Brit dealers who clearly loose out to smart buyers & stackers.

I am not aware that the margin scheme is applicable to bars so how can you offer this whilst the German dealers charge 19% VAT on bars ?


 

[ChardsCoinandBullionDealer]

16 hours ago, Pete said:

Just a bit confused on this VAT topic.

I always believed that VAT on secondhand silver was actually 0% ( i.e. zero rated ) but in the UK our dealers elect to apply full VAT at 20%.

Up until several years ago, Germany had a reduced rate of VAT on silver coins ( and coin bars ) but NOT on silver bars.
From memory the VAT on coins was only 7% but on bars 19% as it still is today.
When the authorities changed the rules, the VAT on coins became 19%, so the dealers found the loophole of the differential VAT scheme only charging VAT on their margin.
This meant the EU dealers kept their prices much lower than the Brit dealers who clearly loose out to smart buyers & stackers.

I am not aware that the margin scheme is applicable to bars so how can you offer this whilst the German dealers charge 19% VAT on bars ?


 

In the UK, VAT is charged on new silver coins and bars at 20%. When we buy coins and bars, we can sell them using the Special Scheme / VAT margin scheme - it is a cheaper way to buy silver but we don't always have stock available. These silver bars sold out the same day we added them to the website.
- VAT margin schemes tax the difference between what you paid for an item and what you sold it for, rather than the full selling price. You pay VAT at 16.67% (one-sixth) on the difference.
You can see more details here https://www.gov.uk/vat-margin-schemes/overview

[sovereignsteve]

@ChardLizzie

How is this squared with the practice you are using?

"You can’t use a margin scheme for:

• any item you bought for which you were charged VAT
• precious metals
• investment gold
• precious stones"

[sovereignsteve]

A few definitions:

 

20.1 Definitions of eligible goods

Collectors’ items

Collections and collectors’ pieces of zoological, botanical, mineralogical, anatomical, historical, archaeological, palaeontological, ethnographic, numismatic or philatelic interest

 

20.2 Definitions of ineligible goods

Precious metals

Goods (including coins) consisting in precious metals or any supply of goods containing precious metals where the consideration for the supply (excluding any VAT) is, or is equivalent to an amount which does not exceed the open market value of the metal contained in the goods.

For gold coins sold at or below the open market value (that is the daily ‘fix’ price) the special accounting and payment system for gold transactions applies. Further details can be found in Notice 701/21 Gold.

Investment gold

Gold coins which meet the definition of investment gold are not considered of numismatic interest and are not eligible for the margin schemes. Further details about investment gold can be found in Notice 701/21A Investment Gold Coins.

 

So if I understand it correctly; anything numismatic and any bullion coin or bar that is sold for above the going rate for the contained metal, is eligible for the margin scheme?

I suppose the crucial factor is "the open market value of the metal contained in the goods" and how this is defined and evaluated.

It seems to me that this issue has been the subject of much misunderstanding and misinformation for as long as I can remember.

I still can't fathom out why HGM still charge the full VAT on second hand silver coins and bars even though their selling premium is usually 23% above spot?

[ChardsCoinandBullionDealer]

41 minutes ago, sovereignsteve said:

@ChardLizzie

How is this squared with the practice you are using?

"You can’t use a margin scheme for:

• any item you bought for which you were charged VAT
• precious metals
• investment gold
• precious stones"

 

19 minutes ago, sovereignsteve said:

A few definitions:

 

20.1 Definitions of eligible goods

Collectors’ items

Collections and collectors’ pieces of zoological, botanical, mineralogical, anatomical, historical, archaeological, palaeontological, ethnographic, numismatic or philatelic interest

 

20.2 Definitions of ineligible goods

Precious metals

Goods (including coins) consisting in precious metals or any supply of goods containing precious metals where the consideration for the supply (excluding any VAT) is, or is equivalent to an amount which does not exceed the open market value of the metal contained in the goods.

For gold coins sold at or below the open market value (that is the daily ‘fix’ price) the special accounting and payment system for gold transactions applies. Further details can be found in Notice 701/21 Gold.

Investment gold

Gold coins which meet the definition of investment gold are not considered of numismatic interest and are not eligible for the margin schemes. Further details about investment gold can be found in Notice 701/21A Investment Gold Coins.

 

So if I understand it correctly; anything numismatic and any bullion coin or bar that is sold for above the going rate for the contained metal, is eligible for the margin scheme?

I suppose the crucial factor is "the open market value of the metal contained in the goods" and how this is defined and evaluated.

It seems to me that this issue has been the subject of much misunderstanding and misinformation for as long as I can remember.

I still can't fathom out why HGM still charge the full VAT on second hand silver coins and bars even though their selling premium is usually 23% above spot?

When we are buying silver coins and bars we are not paying VAT to the customer.

As we are VAT registered when we sell the coins or bars we charge VAT on our 'dealer's premium' - for these items you are saving approx 13% against the new price. This also applies to silver medallion sets and gold sets which are not investment gold such as pattern proof sets. We have a wish list where investors looking to buy special scheme silver are offered secondhand silver first - they don't tend to stick around long. An example of the savings that can be made is shown here:

1kg Metalor Bar https://www.chards.co.uk/silver-one-kg-bar-one-kg-bar/796 starts at £573.62 (quantity breaks available)
Second hand 1kg Metalor Bar with cert (looks the same as the new bars but not actually new from the refiner) https://www.chards.co.uk/silver-bars/one-kilo/metalor-secondhand-silver-bullion-bar/792 £531.64 
Second hand 1kg bar (our choice of refiner, all LBMA approved) https://www.chards.co.uk/1kg-silver-bars/silver-bullion-bar/498 starts at £511.64
Therefore a saving of £61.98, this increases the more you buy.

Hope this makes sense

[Pete]

3 hours ago, sovereignsteve said:

I still can't fathom out why HGM still charge the full VAT on second hand silver coins and bars even though their selling premium is usually 23% above spot?

Probably because they don't know any better.
Does anyone actually buy silver coins from HGM at these prices ?

I once bought some silver coins from a UK dealer when I was still a bit naive and before this forum was established.
The invoice shows silver Britannias at £xx.xx each and 20% VAT and secondhand Britannias at £yy.yy each plus 0% VAT.
As the coins were the same year the gross prices were exactly the same but new coins included 20% VAT and used coins 0% VAT.
 

[sovereignsteve]

6 hours ago, Pete said:

Probably because they don't know any better.
Does anyone actually buy silver coins from HGM at these prices ?

Their silver tends to stick but does shift eventually. Whether they do sell them or melt them I've no idea.

I did once buy some half-ounce goats from them which were still a nice price even allowing for the vat.

I have asked them why they charge vat even though many of their competitors use the margin scheme and didn't really receive a satisfactory answer. I got the impression they didn't really understand the question.

[ChardsCoinandBullionDealer]

That doesn't sound correct

[sovereignsteve]

3 hours ago, ChardLizzie said:

That doesn't sound correct

In what way, @ChardLizzie

[jason1977]

So--- stick to the gold and silver dealer 2 miles from my house. Got it!