Bed/Breakfast gold

[Bratnia]

https://www.gov.uk/hmrc-internal-manuals/capital-gains-manual/cg13350

If you sell, and then repurchase the same asset again within 30 days, then HMRC considers that as not having sold, the capital gain tax applied when you do eventually sell is from the original purchase date.

So I sell a one ounce gold bar, for five times the price I paid for it some years earlier, £300 purchase price, £1500 sale price. Capital gain £1200. However if I immediately buy a Britannia one ounce coin with the sale proceeds instead, then as gold is gold, fungible, I haven't actually sold gold, which I haven't, I still own a ounce, but a coin instead of a bar. A year later I sell the Britannia, maybe for £2000, and being legal tender there's no CGT to declare.

OK it cost to swap, maybe sold the bar at 1% below spot, bought the Britannia at 3.5% above spot, a 4.5% cost which on £1500 = £67.50. But that's considerably less than than the £1200 gain x 20% tax = £240 capital gain tax that otherwise would have been incurred.

Is my reading/understanding correct?

[sixgun]

Are you are collector?
Did you buy that gold bar as part of your collection?
Seems like it - you kept it for 'some years' - hardly the thing a trader would do. You clearly aren't doing this commercially.

The bar belonged to you, it was part of your private property - it was a chattel.

You sold the bar for £1500. That's less than the £6000 per sale threshold for chattels. No need to declare it. 
This has been covered before on the forum - and i feel sure you were involved in some of those discussions.

Stop trying to give your hard earned money away to the criminals in Westminster, they only squander it anyway.

[Bratnia]

Yes I remember that thread. With the chattels approach however and they've pretty much opened up litigation/challenge by extension to exclude the likes of wine (gold, paintings) bought/held as a investment.

As for the bar, for posting/example purposes I scaled down from a London Loco Good Delivery bar :)

 

[sixgun]

9 hours ago, Bratnia said:

Yes I remember that thread. With the chattels approach however and they've pretty much opened up litigation/challenge by extension to exclude the likes of wine (gold, paintings) bought/held as a investment.

As for the bar, for posting/example purposes I scaled down from a London Loco Good Delivery bar

 

You are a collector - you are arranging your collection - this is not a business, you aren't a commercial entity in this. You are living life and doing your thing with your private property. 

Yeah i forgot you were dealing with a 400 oz good delivery bar. i guess a £615k transaction would be declared.

[sixgun]

17 hours ago, Bratnia said:

Yes I remember that thread. With the chattels approach however and they've pretty much opened up litigation/challenge by extension to exclude the likes of wine (gold, paintings) bought/held as a investment.

https://www.accaglobal.com/uk/en/technical-activities/uk-tech/in-practice/2021/may/capital-gains-and-chattels.html

Quote

Non-wasting chattels

A non-wasting chattel is tangible movable property with an expected life of more than 50 years. Examples of non-wasting chattels include fine art, antiques, jewellery etc.

For non-wasting chattels, the following rules apply:

Gains on non-wasting chattels when proceeds are lower than £6,000

S262 of Taxation of Chargeable Gains Act 1992 (TCGA) states that a gain accruing on a disposal of an asset which is tangible movable property shall not be a chargeable gain if the amount or value of the consideration for the disposal does not exceed £6,000.

Example 1
Karen bought a painting for £1,000 and sold it for £5,900. The gain of £4,900 is exempt from capital gains tax because the disposal proceeds do not exceed £6,000.

You are a collector - you collect coins. They are part of your private property - your chattels.

They are non-wasting chattels. Where the proceeds of a sale are less than £6,000 any 'gains' are exempt from capital gain tax.

[Bratnia]

2.1 Definition of investment gold

Investment gold is either:

(a) gold of a purity not less than 995 thousandths that is in the form of a bar, or a wafer, of a weight accepted by the bullion markets .....

From HMRC manuals