Gold Bars or Gold Coins

WG Bullion now carries gold coins only. This guide is kept because it explains why — the reasoning below is the reasoning behind the range.

The honest answer is that it depends on how much you are buying and whether you are a UK taxpayer. For most private buyers in Britain the answer is coins, and the reason is tax rather than metal.

What you actually pay for

Gold trades at a spot price. Above that sits a premium covering refining, minting, distribution and the dealer's margin. Premium is where the difference between bars and coins lives.

Bars carry the lower premium, and it falls as they get bigger: a one kilo bar is the keenest metal in any dealer's range, a one gram bar the dearest per gram by a wide margin. Coins cost more to strike and carry more premium, but they buy you two things a bar cannot.

What coins buy you

Divisibility. Twenty Sovereigns can be sold five at a time as you need the money. A one kilo bar is a single decision — you sell all of it or none of it.

Tax standing. This is the big one. UK legal tender coins — every size of Sovereign and Britannia — are exempt from Capital Gains Tax for UK residents, whatever the gain. Bars are not legal tender and never qualify. Both are free of VAT.

On a holding of any size held for any length of time, that exemption tends to dwarf the premium you saved on a bar.

And the third thing

A coin has a date, a monarch and a designer. It can be looked up, compared and collected, and a scarce date can be worth more than its gold. A bar is a weight with a serial number. That is not a criticism of bars — it is the whole point of them — but it is the difference that decides what is interesting to own.

Where that leaves us

We carry coins. If you are not a UK taxpayer and want the cheapest possible metal, a large bar from a bullion dealer will beat anything here on premium, and we would rather say so than pretend otherwise.

General information, not tax or investment advice.