Is it good practice to keep a record of purchases

[Bigmarc]

I am new to the forum and am venturing from hobby collector in to stacking. Before now I have paid no attention to premiums, vat and taxes. Well I have spent a couple of days trying to get clued up and I suppose I aim this question at the long termers. 

Is it common practice to keep records of all purchases?

In one generation we have had two different vat systems, one just after the war and one when entering Europe. The tax varies between 10% to 100%. Capital gains tax also varies. When I look at where most of the coins are minted, most are from old commonwealth countries, the vat is as low as 5% if at all on "all" precious metals. I find this ironic when the head of state is our queen ( I'm from the UK) and should be renamed the uncommon wealth. 

I think the point am trying to make is that laws can change quickly, do I need to cover my bum? in years to come if I have accumulated 1000 Oz, what questions will they ask?

Thanks

 

[Alex944]

I can't comment specifically on UK circumstances, but in general terms I would say yes, it is advisable to keep some form of records of your purchases for your own reference. 

To which extent is up to you; I record all following info for my purchases:

Type of purchase (which coin/bar etc.)
Date of Purchase
Where I purchased it
Price of purchase

This enables me to have a quick look at a document and see what I paid for which coin, when and where etc. 

I read in a previous thread around CGT that for most stackers in the UK, CGT shouldn't be much of an issue (as it is now) because there's a personal threshold of 11.000/12.000 GBP per year of Capital gains profit. Unless you make more profit than that on your assets that are CG liable, it should not cause any issues. I would advise to check the actual Threshold and all that - I just read that on a thread in the forum and since I'm not a UK resident, I can't 100% vouch if that's true or not.

I don't think that questions will be asked about your stack in general. Though 1000oz is a lot in my eyes, it's quite small in the general sense. Relate that back to the above, if you've made 10 pound per coin and they were all CG liable, you could sell all 1000oz in the same year and still not be bothered by CGT. Of course to dodge any CGT, you can always liquidate parts of your stack according to the threshold and hold on to the rest for the next Fiscal year so the threshold resets.

Hope that helps!

[Scuzzle]

You have to keep a spreadsheet of all your metals purchases, the simplest of all the reasons is when the time comes to sell you have to know at least know you are selling for more than you paid.  I run an Excel speadsheet with the following criteria

Coin   /   Weight   /   Type   /   Qty   /   Date of Purchase & Coin Date   /   Cost Per Item (Inc. Additionals)   /   Total (Inc. Additionals)   /   Coin Type   /   Spot Price On Date of Purchase.

Edited February 10, 2021 by Scuzzle

[GoldStatue]

If I buy second hand collectable coins I also make a note of the release price from the mint. Luckily for the Royal Mint it is easy information to dig out for their modern coins.

[Pete]

Definitely a good practice to keep records.
Whether you pay sales tax, VAT, tourist occupancy tax or whatever tax, it is good to ensure you know what the coins actually cost.
Generally you want to know what the coin cost before all the add-ons so you can always check back to spot price or compare against other sources at the time.
Then you need to know what I describe as the 'net landed cost' .
This is the true cost of getting the coin(s) in your hand.
It is a personal choice whether you break this down to shipping, bank fees, PayPal fees, exchange rate etc. - anything that adds to the original price.
In years to come without the NLC you will not know whether you are in or out of pocket if selling.

[Norskgeld]

Also if you store them at home it would be a wise move in case they get stolen and you have to claim on your contents insurance.

[Bigmarc]

10 hours ago, Alex944 said:

I can't comment specifically on UK circumstances, but in general terms I would say yes, it is advisable to keep some form of records of your purchases for your own reference. 

To which extent is up to you; I record all following info for my purchases:

Type of purchase (which coin/bar etc.)
Date of Purchase
Where I purchased it
Price of purchase

This enables me to have a quick look at a document and see what I paid for which coin, when and where etc. 

I read in a previous thread around CGT that for most stackers in the UK, CGT shouldn't be much of an issue (as it is now) because there's a personal threshold of 11.000/12.000 GBP per year of Capital gains profit. Unless you make more profit than that on your assets that are CG liable, it should not cause any issues. I would advise to check the actual Threshold and all that - I just read that on a thread in the forum and since I'm not a UK resident, I can't 100% vouch if that's true or not.

I don't think that questions will be asked about your stack in general. Though 1000oz is a lot in my eyes, it's quite small in the general sense. Relate that back to the above, if you've made 10 pound per coin and they were all CG liable, you could sell all 1000oz in the same year and still not be bothered by CGT. Of course to dodge any CGT, you can always liquidate parts of your stack according to the threshold and hold on to the rest for the next Fiscal year so the threshold resets.

Hope that helps!

Thanks,

I am definitely looking long term. Currently we have a capital gains tax exemption on British coins. In years to come I not so sure that will be the case. 

1000 Oz is just a goal. Just trying to plan my steps ahead.

[Bigmarc]

5 hours ago, GoldStatue said:

If I buy second hand collectable coins I also make a note of the release price from the mint. Luckily for the Royal Mint it is easy information to dig out for their modern coins.

Thanks. This will help me with what I have collected so far. 

[Bigmarc]

2 hours ago, Norskgeld said:

Also if you store them at home it would be a wise move in case they get stolen and you have to claim on your contents insurance.

This is a area that I have not thought of, I was thinking of just writing it in a book (the old fashioned way) for privacy reasons. But maybe safer to actually have a excel spreadsheet. 

[Bigmarc]

5 hours ago, Pete said:

Definitely a good practice to keep records.
Whether you pay sales tax, VAT, tourist occupancy tax or whatever tax, it is good to ensure you know what the coins actually cost.
Generally you want to know what the coin cost before all the add-ons so you can always check back to spot price or compare against other sources at the time.
Then you need to know what I describe as the 'net landed cost' .
This is the true cost of getting the coin(s) in your hand.
It is a personal choice whether you break this down to shipping, bank fees, PayPal fees, exchange rate etc. - anything that adds to the original price.
In years to come without the NLC you will not know whether you are in or out of pocket if selling.

Thanks , 

I suppose when I reach a certain point it would be hard to keep track. I keep thinking when the USA made it illegal tho hold gold and forced people to sell. I wonder how many people lost money at that point if they had not kept records.

I have started my excel sheet.

 

 

[Robda1986]

Yep I went old school I use a note book every thing I buy gets wrote down in it computers can and do break 

date

description

Price Inc postage 

Where its come from either, tsf, bbp, Atkinson, ats ect 

 

[GoldStatue]

I was wondering if anyone had ever been asked for proof of purchase when they went to sell their coins? 

[Bigmarc]

12 hours ago, GoldStatue said:

I was wondering if anyone had ever been asked for proof of purchase when they went to sell their coins? 

The more I look into this the more I see it is a important thing to do for long term stackers. Currently there doesn't seem to be much of a problem. 

If I was to walk into a car dealership and spend more than 10,000 euros (8.700 pounds), the transaction has to be reported to HMRC anti money laundering law. Also a little while back i tried to put 200 pounds in cash to somebody else's bank account. In their bank. I wasn't allowed to do it. What would the future rules be?

My aim is small. Three Oz a month. If I did that for 20 years then that's 720 Oz. Even at today's rate that's a lot of money. 

I have started doing a book, it's proving difficult as most were done cash deals at coin fairs many years ago.

[MrB]

I just put together my own spreadsheet. I haven't even been collecting that long, but I know that the longer I leave it the harder it will be to track down all the info. 

Moving to a new country is not an impossibility in the nearish future, so having a well documented record of everything will hopefully save me all kinds of headaches.

Also thinking of having a digital signature (PGP, or something) for each record so that I can 'prove' that this isn't just stuff I made up for the purposes of defrauding the taxman in whatever country it ends up. 

[TeaTime]

I've never bothered keeping cost records. I buy either what i like or what i consider to be a good price at the time of purchase...

Quite frankly if i HAVE TO sell off some of my silver then it will make no difference - what options are there ? I've always considered PM's as a store of wealth rather than an opportunity to make (more) money.

As for changes in the law or proving ownership - for the first one there's not a lot you can do and for the second having a spreadsheet is meaningless. Receipts would probably be accepted as proof of ownership, a hand written/typed book most certainly wouldn't be. 

Hopefully this will not become an issue in my lifetime 😶

[Bigmarc]

2 hours ago, TeaTime said:

I've never bothered keeping cost records. I buy either what i like or what i consider to be a good price at the time of purchase...

Quite frankly if i HAVE TO sell off some of my silver then it will make no difference - what options are there ? I've always considered PM's as a store of wealth rather than an opportunity to make (more) money.

As for changes in the law or proving ownership - for the first one there's not a lot you can do and for the second having a spreadsheet is meaningless. Receipts would probably be accepted as proof of ownership, a hand written/typed book most certainly wouldn't be. 

Hopefully this will not become an issue in my lifetime 😶

Tell that to delboy and rodders with their Victorian egg timer. 

Seriously I ended up doing it anyway mainly for insurance purposes. It took me ages routing through old receipts. I think if you put so much time and effort into something it's not much of a extra step to keep a record. 

[SilverStorm]

On 10/02/2021 at 11:24, Bigmarc said:

Thanks , 

I suppose when I reach a certain point it would be hard to keep track. I keep thinking when the USA made it illegal tho hold gold and forced people to sell. I wonder how many people lost money at that point if they had not kept records.

I have started my excel sheet.

 

 

I have my excel spreadsheet and invoices uploaded to the cloud.  On the off chance I lose my paper invoices due to disaster (fire or flood), I can retrieve the digital copies.  

Edited May 15, 2021 by SilverStorm