Gold & Collectibles: Record Keeping For UK Taxes
- MAZ
- Dec 10, 2025
- 11 min read
Owning gold and other collectibles is a popular investment and wealth-saving strategy for many UK taxpayers and business owners. However, these assets carry specific UK tax implications, particularly around income tax, Capital Gains Tax (CGT), VAT, and inheritance tax.
This article offers practical guidance on record keeping and tax compliance for 2025/26, helping you verify your income tax liability correctly, understand tax bands including Scottish and Welsh variations, and navigate complex personal/business tax scenarios such as incorrect tax codes or multiple income streams. It also includes original, actionable tools like checklists, tables, and examples to optimise your tax affairs in line with the latest HMRC rules.
Understanding the Tax Treatment of Gold & Collectibles
What Counts as Gold and Collectibles?
For tax purposes, gold generally falls into categories such as:
● Investment-grade gold: Bars and coins with high purity (typically 99.5% or higher), including UK legal-tender coins like the Sovereign and Britannia.
● Non-investment gold: Jewellery, decorative gold, and collectibles not meeting HMRC’s investment gold definition.
● Collectibles: Items such as rare coins (not necessarily gold), antiques, and art.
Different tax rules apply depending on which category your gold or collectible falls into.
Tax Types Involved
Capital Gains Tax (CGT): Applies when you sell investment gold or collectibles and make a gain above the annual exemption. Some UK legal-tender gold coins like Sovereigns and Britannias are CGT-exempt.
Income Tax: Relevant if you trade in gold/collectibles as a business.
Value Added Tax (VAT): Investment gold is VAT-exempt; however, VAT often applies to non-investment gold and other collectibles.
Inheritance Tax (IHT): Gold and collectibles form part of your estate for IHT purposes.
Why Record Keeping Matters
HMRC requires detailed, accurate records for calculations of CGT and income tax liability involving gold and collectibles. Poor record keeping can lead to incorrect tax returns, potential fines, and overpayment or underpayment of tax.
Essential Records to Keep
You must retain records of the following for each transaction involving gold or collectibles:
● Date of acquisition and disposal: The exact purchase and sale dates.
● Purchase price and sale proceeds: Include all costs such as dealer fees or auction charges.
● Description of the item: Detailed enough to identify the asset, including its type, purity, and weight if applicable.
● Proof of purchase: Receipts, invoices, or certificates of authenticity.
● Legal status of the coin or collectible: For example, whether a coin is UK legal tender.
● Usage of the item: Whether the item is held for investment, personal use, or trade.
● Valuation documents: Professional valuations if the value is uncertain or for inheritance tax purposes.
HMRC recommends keeping these records for at least six years from the end of the tax year they relate to.
Special Considerations for Different Taxpayers
● Self-employed or traders: Must keep business-related purchase and sale records, separating them from personal assets.
● Multiple incomes or businesses: Careful record segregation is crucial to avoid mix-ups in tax calculations across sources.
● Scottish and Welsh taxpayers: Income tax rates and bands vary by nation; ensure accurate application using current government tables.
CGT Basics in 2025/26
CGT is payable on gains above the annual exempt amount, which for the tax year 2025/26 is £6,000 for individuals. Higher-rate taxpayers pay 20% CGT on gains from disposals of most assets, with residential property gains taxed at 28%
.
CGT on Gold
● Investment gold bars and coins: Gain is taxable after deducting acquisition costs and the CGT allowance unless exempt.
● UK legal tender coins (e.g., Sovereigns and Britannias): Exempt from CGT regardless of gain size.
● Non-investment gold and collectibles: Gains may attract CGT, and you must keep adequate records.
CGT Calculation Example
Transaction Detail | Example Data |
Purchase Price | £10,000 |
Sale Price | £15,000 |
Costs (Dealer fees, etc.) | £500 |
Gain (Sale - Purchase - Costs) | £4,500 |
Annual Exempt Amount | £6,000 |
Taxable Gain | £0 (gain less than exempt) |
In this example, because the gain is less than the annual exemption, no CGT is payable.
VAT Exemptions and Applicability
Investment-grade gold (bars and qualifying coins) is exempt from VAT, saving you 20% upfront at sale. However, non-investment gold products and most collectibles attract VAT at 20%.
UK Legal Tender Coins and VAT
Qualifying UK legal tender coins are VAT-exempt, making them tax-efficient for investors, especially when combined with CGT exemption.
Income Tax Considerations & Businesses
If you operate a business dealing in gold or collectibles, profits are subject to income tax or corporation tax. Accurate, separate business records must be maintained to calculate taxable profit or loss—different from capital gains rules.
Inheritance Tax (IHT)
Gold and collectibles are part of your estate for IHT purposes, potentially attracting 40% tax if the estate value exceeds the nil-rate band (£325,000 or higher depending on circumstances). Accurate valuation and documentation are crucial to avoid disputes
Record Keeping Checklist for Gold/Collectibles Transactions
● Purchase and sale dates
● Purchase and sale prices (with invoices/receipts)
● Description and weight/purity details
● Legal tender status documentation
● Cost details (e.g., dealers fees, storage costs)
● Proof of identity/source for collectible coins
● Insurance and valuation documents (especially for inheritance tax)
● Separate personal vs business records
Scenario 1: Individual Investor Selling Gold Bars
● Bought 100g investment gold bars on 1 Jan 2024 for £4,000 total.
● Sold bars on 30 Sep 2025 for £4,500.
● Recording purchase price, sale price, and associated costs shows a £500 gain.
● Gain is below the CGT annual exemption for 2025/26 (£6,000), so no CGT payable.
● Keep original purchase/sale receipts and weight certificates.
Scenario 2: Business Owner Trading Collectibles
● Starts a business in January 2025 trading silver and gold collectibles.
● Maintains separate business accounts.
● Records all purchase/sale invoices.
● Reports profits via self-assessment under income tax or corporation tax.
● Applies VAT where applicable on taxable sales.
● Registers for VAT, keeping meticulous VAT invoices and payments.
Summary of Key Tax Bands and Allowances for 2025/26
Tax Type | Threshold / Band | Rate(s) |
Income tax (England & NI) | Personal Allowance: £12,570 | Basic: 20%, Higher: 40%, Additional: 45% |
Income tax (Scotland) | Starter: £2,162 - Top: £43,662+ | Rates 19%-46% (varies by band) |
Income tax (Wales) | Same as England but devolved | 20%, 40%, 45% |
CGT Annual Exemption | £6,000 | 10%, 20% (residential property 18%, 28%) |
VAT | Standard rate | 20% (Investment gold exempt) |
IHT Nil Rate Band | £325,000 | 40% over threshold |
High-Income Child Benefit Charge Implications
High earners with gold-related income must consider the high-income child benefit charge, reducing tax credits if income exceeds £50,000, impacting overall tax planning.
Gig Economy & Remote Business Tax Rules
Self-employed individuals buying/selling gold and collectibles online (e.g., via eBay) need to track sales carefully, declare income accurately in self-assessment, and apply CGT rules where applicable, particularly for cross-border sales or digital gold assets.
Summary of Key Points
Maintain clear, thorough records of acquisition, sale, costs, and descriptions of gold & collectibles.
Understand tax categories — investment gold, legal tender coins, and collectibles have different tax treatments.
UK legal-tender gold coins (Sovereigns, Britannias) are both VAT and CGT-exempt.
Capital Gains Tax applies on gains above £6,000 annual exemption for 2025/26.
VAT at 20% applies to most non-investment gold and collectibles.
Business owners must differentiate business income tax from personal CGT, with proper bookkeeping.
Scottish and Welsh taxpayers must consider regional income tax rates and thresholds.
Inheritance tax applies to gold and collectibles in estates over £325,000.
Special cases such as high-income child benefit charge or gig economy sales require nuanced tax planning.
Use HMRC’s digital services and portals for reporting and record keeping to ensure compliance.
FAQs
Q1: What records should an individual keep when buying or selling gold for tax purposes?
A1: Well, it’s worth noting that for each gold transaction, you should keep the purchase and sale dates, prices paid and received, detailed descriptions including purity and weight, receipts or invoices, and any associated costs such as dealer fees. These records are essential to accurately calculate any capital gains and substantiate your tax return. HMRC recommends keeping these for six years, just in case of queries or audits.
Q2: Can UK legal-tender gold coins like Sovereigns and Britannias really be exempt from Capital Gains Tax?
A2: Yes, that’s one of the quirks that savvy investors appreciate. UK legal tender gold coins such as Sovereigns and Britannias are exempt from CGT, meaning no matter the gain on disposal, you won’t owe CGT on these coins. This exemption encourages investors to consider these coins as a tax-efficient way to hold gold. But beware: gold bars and most other gold coins do not share this exemption.
Q3: How does VAT apply when buying gold or collectibles in the UK?
A3: Investment-grade gold bars and qualifying coins enjoy VAT exemption, which is a significant advantage compared to other goods. Most collectibles and non-investment-grade gold (like jewellery) attract 20% VAT. So if you’re buying gold bullion for investment, ensure it qualifies under HMRC’s investment gold criteria to avoid VAT costs.
Q4: If someone owns gold through a business, what unique record-keeping must they observe?
A4: For businesses, the key is to separate personal and business holdings strictly. Record every transaction individually, including date, price, and related costs. Businesses must also keep VAT records if registered, including invoices showing VAT charged or reclaimed. Profit or loss from gold sales is treated as business income, so accurate bookkeeping is crucial to ensure correct income tax or corporation tax reporting.
Q5: What should a self-employed freelancer in Scotland do differently regarding tax on gold sales?
A5: Good question. Scottish taxpayers face different income tax bands and rates, so while CGT on gold remains similar, any income derived from trading gold (as opposed to investment sales) will be taxed according to Scottish rates, which start at 19% and go as high as 46%. Keeping proper records allows correct tax calculations, especially if the freelancer has a mix of income sources.
Q6: What happens if someone underpays tax due to income from multiple gold sales not declared?
A6: In practice, this situation can lead to penalties and interest on unpaid tax once identified by HMRC. It’s common for taxpayers to overlook gains from several smaller transactions that add up. The best fix is regular maintenance of records and timely self-assessment submissions declaring all sales and gains to avoid penalties.
Q7: Does inheritance tax apply to gold and collectibles, and how should this be documented?
A7: Yes, gold and collectibles form part of your estate for inheritance tax purposes. Accurate valuations at market value at death are essential. Keeping professional appraisals and purchase records helps executors and HMRC assess the estate’s value correctly. Gold’s inclusion can impact IHT liabilities, especially for larger estates exceeding the nil-rate band threshold.
Q8: How can someone spot errors in their PAYE tax code when they also hold income from gold trading?
A8: It’s a common mix-up, but here’s the fix: HMRC sets tax codes based on reported incomes; if gold trading income isn’t reported, the code may be too low, resulting in under-taxation. Regularly check your Personal Tax Account online to compare expected vs actual tax paid, and contact HMRC promptly if discrepancies appear to avoid unexpected bills later.
Q9: What costs can be deducted from gains on gold or collectibles before calculating Capital Gains Tax?
A9: You can reduce your gain by allowable costs like the original purchase price, dealer or auction costs, valuation fees, and any improvements made to the item. Storage or insurance costs typically aren’t deductible for CGT purposes but might be relevant for business accounting if trading gold.
Q10: Can selling gold on online platforms like eBay complicate record keeping for taxes?
A10: Absolutely, and many taxpayers overlook this. Each sale must be recorded with date, price, and buyer details if possible. Online fees should also be tracked as costs. For frequent sellers, this may amount to trading income rather than capital gains, moving the tax from CGT to income tax rules, so clear records avoid confusion.
Q11: How do fluctuating gold prices affect tax calculations throughout the year?
A11: Gains are calculated on each disposal, using the actual sale price minus allowable costs regardless of market fluctuations. It’s wise to keep detailed records throughout the year rather than lumping transactions together. This helps accurately assess each gain or loss for your self-assessment.
Q12: What should remote or gig-economy workers consider about gold trading tax liabilities?
A12: Remote workers or gig-economy participants must treat gold trading income carefully. Gains on sales may be taxable CGT, but frequent trading can be considered business income. Clear, separate record keeping and early consultation with a tax pro avoid surprises during self-assessment.
Q13: If someone gifts gold or collectibles, are there tax implications they should record?
A13: Gifting can trigger CGT liabilities if the item’s market value exceeds the original purchase price; the gain is calculated based on the market value at the gift date. Maintain records of gifting dates and valuations to ensure proper reporting if your gift exceeds exemption limits.
Q14: How long should records related to gold sales be kept for UK tax purposes?
A14: HMRC requires records to be kept for at least six years after the end of the relevant tax year. This period is critical in case HMRC requests evidence to support your tax returns or if disputes arise. Keeping digital backups of all purchase and sale receipts is highly recommended.
Q15: Can high earners avoid unexpected tax charges related to their gold investment profits?
A15: In my experience with clients, the key is proactive tax planning. High earners must review all income sources, including gains from gold, as they can push them into higher tax brackets or trigger charges like the High Income Child Benefit Charge. A thorough review of records and timely HMRC updates prevent nasty surprises.
Q16: What pitfalls do business owners face when mixing personal and business gold assets?
A16: Mixing records is a common pitfall that can lead to wrong tax treatment, overpayment, or HMRC queries. Business owners should maintain discrete records for business gold trading and personal holdings, clearly marking transactions and costs within separate ledgers or accounting systems.
Q17: Can small sales of collectible gold items qualify for the chattels exemption from CGT?
A17: Yes, the chattels exemption may apply if a single item’s sale price is £6,000 or less, potentially exempting it from CGT. But you must consider whether the item counts as a wasting asset or chattel under HMRC rules, so keep detailed records and consult if unsure.
Q18: How can taxpayers verify the correctness of their tax returns relating to gold transactions?
A18: Using HMRC’s Personal Tax Account, taxpayers can cross-check reported income and gains against bank transactions and official tax code calculations. Maintaining thorough records makes this process straightforward and reduces the chance of errors or unexpected adjustments.
Q19: What should someone do if they discover missing records for past gold sales?
A19: If records are missing, reconstruct as accurately as possible using bank statements, auction house summaries, and dealer communications. If gaps remain, keep written notes of your reconstruction process and inform HMRC if necessary. Transparency helps avoid penalties and supports compliance.
Q20: How do regional differences in UK tax systems impact gold and collectible sales?
A20: The CGT rules are consistent UK-wide, but income tax rates differ notably between Scotland, Wales, and England, affecting any trading profits on gold. Scottish taxpayers, in particular, face different income tax bands up to 46%. So knowing your region’s tax bands and keeping clear records of income types is essential to avoid under or overpayment.
About the Author
Maz Zaheer, AFA, MAAT, MBA, is the CEO and Chief Accountant of MTA and Total Tax Accountants, two premier UK tax advisory firms. With over 15 years of expertise in UK taxation, Maz provides authoritative guidance to individuals, SMEs, and corporations on complex tax issues. As a Tax Accountant and an accomplished tax writer, he is renowned for breaking down intricate tax concepts into clear, accessible content. His insights equip UK taxpayers with the knowledge and confidence to manage their financial obligations effectively.
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