Chards - VAT Free Silver

[ChardsCoinandBullionDealer]

Good morning,

 

*NEW PRODUCT ANNOUNCEMENT*

 

Following on from a number of customer requests for VAT free silver we are proud to announce we have finally got a handful of products live on the site which include 1 ounce silver coins and a Metalor 1 kilo per owned silver bar. 

 

Like other providers of VAT free silver we offer storage outside of the the UK but instead of Switzerland like others our storage facilities are in Guernsey - a bit closer to home if you ever plan to pick up your coins or bars in person! It is worthy to note if you do take delivery you will be subject to pay the required amount of VAT. 

 

For those not fussed on taking delivery (we understand this is not all customers) and happy to leave  their silver in storage we do hope our premiums and storage costs are to you liking. 

 

You can find all of our products available VAT free on this link here.

 

Watch the link above for the addition of more silver products in due course. 

 

All the best,

 

Ian 

[Pete]

Of nil interest to me unfortunately.
I remain totally confused as to how in the EU where rules are set more or less across the board, the Germans, Belgians and Estonians can apply differential VAT to coins and UK dealers cannot or choose not to. This all happened a few years ago when in Germany the VAT was increased from 7% to 19% and they found a legal loophole.
Also why is full VAT charged by UK dealers on secondhand silver when the VAT rate should I believe be 0%.
Many of us, myself included would rather buy locally but every order I place for silver ( or platinum ) is across the channel even for UK minted coins.

[ChardsCoinandBullionDealer]

6 minutes ago, Pete said:

Of nil interest to me unfortunately.
I remain totally confused as to how in the EU where rules are set more or less across the board, the Germans, Belgians and Estonians can apply differential VAT to coins and UK dealers cannot or choose not to. This all happened a few years ago when in Germany the VAT was increased from 7% to 19% and they found a legal loophole.
Also why is full VAT charged by UK dealers on secondhand silver when the VAT rate should I believe be 0%.
Many of us, myself included would rather buy locally but every order I place for silver ( or platinum ) is across the channel even for UK minted coins.

Hi Pete,

 

Yes we would agree entirely that its overly complicated and personally would welcome a similar exempt status for silver as it has been for gold since January 2000. This way anyone taking delivery of physical silver would not be "penalised" with a VAT liability and it would make silver a far more attractive investment option. 

 

Your question regarding second hand silver is a good one. I cannot vouch for other dealers but we do not charge 20% on our second hand scheme silver - the guidance from HMRC on second hand goods is that VAT is to be charged out only on the profit margin made as the full amount of VAT was already collected when the product was first bought new. We follow the special scheme process so can pass on the savings to our cusotmers.  So for all the products on the following link you can take advantage of reduced VAT - https://www.chards.co.uk/category/buy-bars/a/silver/special-scheme

 

Not sure if you have ever tried but HMRC guidance is difficult to follow so if you are interested in reading more we do have a blog where we hope its easier to follow -  https://www.chards.co.uk/blog/special-scheme-silver/259 - 

 

This coin here has been very popular recently with UK customers as its our cheapest newly minted coin and at a really low premium. Maybe it is of interest to you - https://www.chards.co.uk/products/cheap-silver-coins-cgt-exempt

 

Hope some of the above information you find useful.....

 

Thanks

 

Ian

 

[Pete]

2 hours ago, ChardsCoinandBullionDealer said:

Hi Pete,
Your question regarding second hand silver is a good one. I cannot vouch for other dealers but we do not charge 20% on our second hand scheme silver - the guidance from HMRC on second hand goods is that VAT is to be charged out only on the profit margin made as the full amount of VAT was already collected when the product was first bought new. We follow the special scheme process so can pass on the savings to our cusotmers.  So for all the products on the following link you can take advantage of reduced VAT - https://www.chards.co.uk/category/buy-bars/a/silver/special-scheme

This coin here has been very popular recently with UK customers as its our cheapest newly minted coin and at a really low premium. Maybe it is of interest to you - https://www.chards.co.uk/products/cheap-silver-coins-cgt-exempt

Thanks Ian for replying.

1. Have you investigated the margin / differential VAT scheme adopted by your EU competitors ?
Is there an HMRC block or is it down to UK suppliers not bothered to adopt or challenge ?
Unfortunately you are at a big disadvantage and loosing substantial business because of this.
Perhaps post-Brexit there will no longer be the possibility of low VAT imports and alternative routes will no doubt be found.

2. I did a quick check on prices for the Lunar Rooster and you are indeed extremely competitive at £15.05 ( £14.94 for 100 ) especially against STG who list £19.06 using the margin scheme and several German dealers quoting around £17.20.
However GS.be are quoting €16.47 which is £14.77 using a guaranteed fixed exchange rate today from Transferwise of 1.11530

3. Platinum has a similar problem and BullionbyPost today are quoting £836.88 for a 1 oz Queens Beast Dragon ( CoinInvest £810.77 and Royal Mint Bullion £735.63 ) and I recently paid GS.be £668.50 so a substantial difference between main sellers.

[ChardsCoinandBullionDealer]

Good morning Pete,

 

First thanks for the information and I had the first decent look at this at the weekend and to be honest it needs more investigation as I cant see how VAT free silver can be offered to non VAT registered entities - special scheme yes but not VAT free silver. My initial findings are that silver should be subject to 21% in Belgium and 7% in Germany which for second hand coins only gets applied to the profits, for new it would be to the full value. I stand to be corrected here and if you have any info I would be keen to hear/see it.  We are in the process of writing a blog that will detail our investigation and findings which once complete ill add to this thread for those that are interested. 

 

Thanks

 

Ian

 

 

 

 

 

 

 

 

[Martlet]

@ChardsCoinandBullionDealer This German dealer seems to give the best explanation.  https://www.goldsilbershop.de/silbermuenzen-differenzbesteuerung.html

[ChardsCoinandBullionDealer]

Thank you for the link @Martlet and even with google translate failing to translate effectively I was able to read between the lines. We have put together a blog from our research and discussions. Do let us know if we have missed anything prudent as we are happy to add more in to complete the page. 

https://www.chards.co.uk/blog/vat-free-silver/293

[StackerNoob]

I wont be making a purchase on this occasion, but any more bullion coins that come up at £13 and I might consider it.

Guys credit where its due, £13.15 is an unbelievably good price for an oz of silver from a UK based dealer. I think you'd struggle to find anything cheaper.

EDIT: Just noticed thats for vaulted storage. God damn it, sucked in by the smoke and mirrors.

[Jimmock]

Not even a good price for stored, £11.04 an oz at royal mint. 😉

[ChardsCoinandBullionDealer]

Good morning,

 

For those interested we have added stock to our very popular secondary market silver maple for our Bonanza sale. The price is for delivery and you can take advantage of reduced VAT as the coins are bough and sold on the second hand scheme! - https://www.chards.co.uk/1oz-silver-maple-coin/1-ounce-silver-maple-bullion/651/kB23r

 

We have all our other Bonanza sale items on this link - https://www.chards.co.uk/blog/bonanza-sale. We have had to split the products across 4 pages as our website load speed would otherwise be slow! 

 

Any questions do let me know and hope your find the deals exciting! 

 

Thanks, Ian 

[Coolsmp]

If All UK dealers refuse to purchase silver from the royal mint i wonder how quick they would push the government to have vat removed

[Pete]

Removing the VAT from silver and Platinum is not going to happen.

I still cannot understand how dealers in the EU ( and VAT registered ) can keep their prices lower using differential VAT.
This seems to be legally available for those who apply it so back to my question - why does no dealer in the UK use the same scheme ?

How does a large dealer like GS.be undercut ALL of our UK dealers most of the time quite substantially.
Silver coins minted in the UK have to be shipped to Belgium ( or Germany ) at a higher cost than locally.
Then there is a currency conversion or bank fee to consider which UK dealers don't incur, not to mention future exchange risk so you need an additional margin.
Wages are most likely higher overseas and GS.be ( and others ) want to make a business profit so are our UK dealers just not interested in competition or happy at the status quo ?
We stackers have to pay a much higher shipping cost per order than if bought locally AND still the unit cost works out less !
Full VAT is a contraceptive to business in the UK so most of us will continue to place our larger orders overseas even buying British coins - wakey, wakey !
The fact that some UK dealers can sell gold at often the lowest prices means the problem lies with the VAT and not the business so why not investigate the VAT scheme properly ?

[silenceissilver]

5 hours ago, Pete said:

Removing the VAT from silver and Platinum is not going to happen.

Why not, who would have thought something closely related even to the softest of all possible Brexits could happen, a few years ago? If all bullion dealers in the UK boycott VAT on silver at the same time, what can the government do? Not much! The only thing it needs it the will not to have this boycott broken up and it can't be broken. All bullion dealers in the UK have a common interest in getting rid of it. And a boycott is just one possibility. VAT on savings which it partly is, is a crime, and the public, not just silver stackers, would support them, if they brought this subject into the news "Stop taxing savings", which you can in various ways. It's not like VAT on silver would be very important to the government, it doesn't need that much pressure for them to drop it. I'm wondering if there is any common  lobbying of the bullion industry at all?

[Pete]

2 hours ago, silenceissilver said:

Why not, who would have thought something closely related even to the softest of all possible Brexits could happen, a few years ago? If all bullion dealers in the UK boycott VAT on silver at the same time, what can the government do? Not much! The only thing it needs it the will not to have this boycott broken up and it can't be broken. All bullion dealers in the UK have a common interest in getting rid of it. And a boycott is just one possibility. VAT on savings which it partly is, is a crime, and the public, not just silver stackers, would support them, if they brought this subject into the news "Stop taxing savings", which you can in various ways. It's not like VAT on silver would be very important to the government, it doesn't need that much pressure for them to drop it. I'm wondering if there is any common  lobbying of the bullion industry at all?

The problem is that whilst we stackers see silver and platinum as precious metals, they are in the eyes of others merely industrial metals hence the VAT.

[sixgun]

8 hours ago, Pete said:

I still cannot understand how dealers in the EU ( and VAT registered ) can keep their prices lower using differential VAT.
This seems to be legally available for those who apply it so back to my question - why does no dealer in the UK use the same scheme ?

As far as i understand it with the German dealers they import silver coins into Germany from outside the EU. The silver goes through German customs and has VAT put on it. In a previous time the VAT on silver coins in Germany was something like 7 or 8% - i forget the exact amount and it does not matter from the explanation.

The rate of VAT applied by German customs is this old rate. Now if the dealers were then to sell to customers as new silver coins they would reclaim the import VAT and apply the current VAT rate in Germany, 19%. However they don't do that, they don't reclaim the VAT, they sell the coins as second hand. That way the 8% VAT is in the price and has already been paid. The only VAT at 19% is on the dealer's profit.

Now in the UK the same silver coins arrive at HMRC and they get hit with 20%. There would be no point in selling them on as second hand b/c there is no differential between the customs VAT and retail VAT.

Now we have had the argument that HMRC is wrongly applying VAT on silver coins and medallions that come into the country. That the rate should be 5% because what is being imported is of numismatic interest. They are of collectible interest. The members here collect coins and medallions. Some people give medallions the name rounds. It is covered by  numismatic collectible code 9705000000.

We have been over this before and not just in this thread. What we collect is of numismatic interest. They aren't lumps of silver, we don't pay spot price unless we are lucky. Coins and medallions are often of a much higher price and the higher price is because of their collector interest. i mean whatever is the higher price for other than collector interest?

HMRC are not playing by their own rules. We should be able to import from the USA and pay 5% VAT. If you are collecting it yourself that is what you should be paying but the pirates have all the guns and do not serve the people.

[Pete]

I cannot believe GS.be and others are importing silver Britannias and UK manufactured Platinum coins from outside the EU.
If they do and can manage to offer low prices then our UK suppliers could do the same but I very much doubt this is how it is done but I am not certain.

As for using the numi code at 5% it does work as I have used it on coins imported from both the USA and Australia.
You have to make your case after being robbed by HMRC but I have had 100% success.
This was discussed in earlier threads with links provided etc.

 

[silenceissilver]

20 hours ago, Pete said:

The problem is that whilst we stackers see silver and platinum as precious metals, they are in the eyes of others merely industrial metals hence the VAT.

Most likely true for platinum but gold and silver are in people's heads as precious metals due to their long history even given that most people don't buy it but in the form of jewelry, if at all. Just ask anyone "would you like to have a lot of gold", most everyone would answer yes.

[greendragon]

i think most of what is inside peoples heads is whats going on in the jungle/big brother coronation st etc.

not everyone for sure, but a horrifyingly large part of the general public

now if you could get Jordan or Beckham to shout about it..........

[silenceissilver]

Beckham and Co wouldn't harm but probably you could get it in the news by putting a huge fake silver stack made of cardboard paper, wrapped in aluminium foil, in front of the Buckingham Palace, place a poor looking pensioner next to it with a sign, "why is 20% of my pensions savings being taxed?" Just an example, there are a million ways even without the Beckhams.

[999magnum]

On 27/11/2018 at 16:30, Coolsmp said:

If All UK dealers refuse to purchase silver from the royal mint i wonder how quick they would push the government to have vat removed

Then how will your doctor's visit be payed?

[Coolsmp]

6 minutes ago, 999magnum said:

Then how will your doctor's visit be payed?

Through the amount of tax i already pay from my salary as well as council tax, 70% tax on petrol, road tax, n.i contributions, not to mention all other hidden taxes we all pay.

[999magnum]

1 minute ago, Coolsmp said:

Through the amount of tax i already pay from my salary as well as council tax, 70% tax on petrol, road tax, n.i contributions, not to mention all other hidden taxes we all pay.

The price of free healthcare...

[Coolsmp]

I dont mind paying tax as i beleive in free health care for all but it seems strange that tax is on silver but not gold and more to the point thousands of pounds are being sent out of the country over to mainland europe by british people buying silver. This money would be better circulating in the UK to improve the ecomony and help UK businesses its just economic sense.

[Martlet]

5 hours ago, Coolsmp said:

I dont mind paying tax as i beleive in free health care for all but it seems strange that tax is on silver but not gold...

It is not strange when you realise silver primary use is in consumption either in industry or jewellery.  Note that only high purity gold is VAT free, because it not used in jewellery as it is too soft and damages easily.