VAT and legal tender coins

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On Wed, 27 Jul 2005 13:26:49 +0100, "Roland Watson"

If they're legal tender then surely they're treated in exactly the same as any other foreign currency coins or banknotes.
Chris
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Not if their value to an investor is other than their face value, such as gold sovereign, krugerands etc.,
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John Boyle

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On Wed, 27 Jul 2005 19:41:52 +0100, john boyle

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

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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.
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