Coins v Bars when including tax

A

anomeric

New Member
Hi all,

I'm new to the whole PM thing but I've been researching for about six months now and I'm finally preparing to buy some silver. I'm in the UK so I'm looking at good places across Europe and I've come across a dealer in Germany who seems very good.

My question is with regards to whether I should buy coins or bars of silver. Normally I'd say bars, but because of the way tax is done, coins seem to be a better buy. Here's why:

1oz silver bar = 32.43 EUR
1oz Silver Eagle = 30.18 EUR
1oz Maple Leaf = 29.81 EUR

The reason being is that tax on bars is 19% but tax on coins is 7%.

I'm thinking I should buy coins, they cost more (before tax) but actually end up costing less after tax, so it seems I'm getting a more valuable item for less because of the differing taxes.

What are your thoughts? Is there a difference to holding coins v bars? Is it harder/easier to sell one or the other?

Thanks
 
If it were me I'd take a drive to Norway and buy it there - where there is apparently no tax on bullion.

Otherwise, I'd get someone from over here to send you "machinery parts".
 
I'm in your world region, and that tax difference talked about by some dealers, has some contradictions. Sometimes I wondered if they are lying about it.
Take for ex Netherland, some dealers state that coins with a face value in a legal tender currency have a lower tax rate set on them. But other dealers state that coins are tax free. Also, the invoices do not show any tax item.
Then, if I calculate the sales price difference with spot, I see exactly that higher (common/consumption) tax ratio. And that isn't normal, because it should be more than spot+tax, otherwise the dealer makes no profit.
One dealer buys back silver at spot +7%. The consumption tax was 19%, and the reduced tax level was 12%. Again, no profit for the dealer.
Also, about legal tender face value, several dealers sell those Andorra "Coin Bars", nominated in Diner. Made by companies alike Umicore. Essentially bars with a legal tender value stamped on them, so called done to profit from a lower tax regime.
But according to EU legal text
http://ec.europa.eu/economy_finance...ro_area/documents/2011-07-06_agreement_en.pdf
2. Collector coins denominated in diners issued by the Principality of Andorra shall not be legal tender in the European Union
Click to expand...
that Dinar is NOT a legal tender currency, and has never been.

So, I started to wonder what I have to believe of what dealers say about tax.
 
Having done some research into this, I guess it depends how much you want to spend.

The shipping costs, the minimum order value, the bank transfer fee if they don't take cards, all eat into the savings you are trying to make.

But yes I've also noted the difference in tax on bars and coins, but here in the UK a 1kg Dragon or Snake is not a lot more expensive than a bar, so I'll take the limited mintage coin and stack those.


Good luck

Rockin'
 
My bank gives me a rate slightly lower than the official - rate. The it costs me 9 for the transfer + 29 for delivery.

I'm looking at buying somewhere between 22 and 25ozt.

10 Maple Leafs + 10 Silver Eagles in Germany + Shipping = 630.70
10 Maple Leafs + 10 Silver Eagles in England = 618.20

I think the prices in the UK are massively over the top, but coming back to my question, I take it I'm better off buying the coins?
 
Coins.. Have purchased both, over here,fortunately no tax on bullion,however the small premium on coins over bars still makes coins preferable. Just the visual attraction alone. Have learnt my lesson, simply compare 10 Oz PM Lunar dragon against a 10oz PM bar in the hand and you will see what I mean. Welcome and keep on stacking.
 
I can't understand why we have such a high tax on bullion. Annoyingly, I found a dealer in the Channel Islands with 0% tax, but getting it shipped in would attract VAT at customs.
 
I hope the Australian government will give us plenty of notice if they decide to tax PM bars.Could this happen? Would that mean we would get a free windfall on the stuff we already own?
 
The problem in the UK is that they charge 0% on Gold but 20% VAT on Silver. Most countries I've seen seem to differentiate between coins and bars, but not the UK.
 
You must log in or register to reply here.
Back
Top