Silver As An Investment
First the Bad News
Investment gold is exempt from VAT, for further information about investment gold please see our "What is Investment Gold" page. Silver however is not exempt from VAT. Many people ask us why not. A better question would be "Why should it be?". Almost everything in the UK and EU is subject to VAT, although there are many exceptions. Perhaps because investment gold is now exempt, people think that all other metals such as silver, platinum, and palladium should also be exempt. Sadly this is not the case.
Because of this, we do not normally recommend silver as an investment, preferring gold, but in exceptional circumstances (when the gold:silver ratio is high), we would consider silver to be a better investment bet than gold.
Some Good News
Second-hand Silver Coins
We also get a small number of second-hand silver coins, both collectors' coins and bullion coins, although we get far more demand for them than we can supply. This also applies to silver bars, but even more so. Most second-hand goods can be resold under a special scheme whereby the only VAT payable is on the dealers margin, and therefore almost negligible.
Investment Silver Coin Bags
We can now supply modest quantities of investment silver coin bags.
These are made up of old silver coins, usually UK coins from the 1920 to 1946 period. These were composed of an alloy containing 50% pure silver. We can supply them in sealed 10 kilo bags. Each bag contains a minimum 10 kilos gross weight of silver coins, and therefore contains 5 kilos of pure silver. Most of these coins will be very worn, and have no collectors value. Because these are dealt with under the "secondhand" scheme, there is no VAT to pay on them * We can offer these investment bags at prices very close to the value of the intrinsic silver content.
* VAT - We pay a small amount of VAT based on our margin, but no VAT is added to our quoted selling prices.
Silver Prices & Potential
Many of our gold coin investors are also convinced that silver is too cheap. Certainly it has in 1974 been as high as about $47 to $50 per ounce, and if were ever to regain those price levels, there would be substantial profits to be made. Whether silver will hit such high prices again, we do not know.
You may wish to view all of our articles on our silver guide