VAT and legal tender coins


R

Roland Watson

Is VAT or excise duty imposed on collector's coins if the coins are still
legal tender in the country of their origin?

Thanks.
 
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C

Chris Blunt

Is VAT or excise duty imposed on collector's coins if the coins are still
legal tender in the country of their origin?
If they're legal tender then surely they're treated in exactly the
same as any other foreign currency coins or banknotes.

Chris
 
P

Peter Ibbotson

Roland Watson said:
Is VAT or excise duty imposed on collector's coins if the coins are still
legal tender in the country of their origin?

Thanks.

Who is charging the VAT?

If you mean customs as it crosses the border into the UK, if it counts as a
collectable (mostly it's not a gold investment coin) then the margin scheme
can apply and a reduced rate of VAT at 5% can apply. I have no idea how you
would do this privately, I'd guess HMCR would try and hit for 17.5% if you
bought from an overseas website, so importing via a VAT registered entity
then buying it off that entity might be worthwhile.

The VAT guide (Section 718) on this is clear as mud as to what happens if
you bring a coin in privately and then find it's valuable once in the UK.

On the other hand if you are buying from a dealer in coins and they bought
the coin from a private indvidual in the UK and they are using the margin
scheme then the VAT is normally only charged on their profit i.e.

Buying price: £700
Selling price £1000
VAT is (1000-700) * 17.5 / 117.5 = £44.68 and the goods were £1000-44.68 so
£955.32

As far as I can see legal tender doesn't matter. i.e. if it's a coin with an
error so counts as a collectible it could still be legal tender in the
original country.
 
C

Chris Blunt

Not if their value to an investor is other than their face value, such
as gold sovereign, krugerands etc.,
VAT was abolished on "investment gold" in January 2000. That includes
krugerrands, gold sovereigns, other bullion gold coins.

Chris
 
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J

john boyle

Chris Blunt said:
VAT was abolished on "investment gold" in January 2000. That includes
krugerrands, gold sovereigns, other bullion gold coins.
I didnt know that, thanks for the info.
 

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