The rush for gold coins - investors rush to buy the gold metal as prices rise ahead of potential CGT changes

Gold price hit another record high on16 October, passing £2,060 an ounce, driving investors towards the yellow metal.

In particular, investors have been cashing in on gold they hold to take advantage of high prices, but are also stashing up on gold coins to take advantage of tax-saving opportunities.

Latest data from The Royal Mint shows a surge in demand for gold coins with a record quarter of bullion coin sales on its website - revenues increased 110% in the third quarter, July to September 2024.

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Investors have also capitalised on record prices by selling bullion bars and DigiGold back to The Royal Mint, which resulted in revenues going up 86% and 91% respectively.

Ongoing geopolitical uncertainty, global volatility and falling interest rates contributed to gold prices rising in the third quarter, with the gold price in sterling now up 20% this year so far (as of 30 September). 

Investing in gold is often a popular, especially at times of uncertainty. Recent price rises saw gold bullion sales from The Royal Mint rising 63% year-on-year.

Why are gold bullion coins popular?

Bullion coins produced by The Royal Mint are classed as capital gains tax free investments and provide a tax-efficient way to invest in precious metals.

While Labour has said it does not plan to raise income tax, VAT or National Insurance, this has led to speculation that CGT could be in the firing line, hitting investor returns.

This has not only led to investors topping up their tax free allowances with ISAs and Sipps, but has also driven investors to tax efficient investments like gold coins. 

“UK investors are increasingly favouring CGT-exempt products, such as bullion coins. Sales of CGT-exempt bullion coins on The Royal Mint’s website have surged to a record high in the third quarter, with revenues up 110% compared to the same period last year. This has primarily been driven by a significant uplift in gold bullion coin sales. Between July and September 2024, revenues from silver and gold coin sales rose by 42% and 118% respectively, when compared to the same period in 2023. By contrast, sales of bullion bars, which are subject to Capital Gains Tax (CGT), have fallen, dropping by 11% year-on-year,” The Royal Mint stated.

Research from The Royal Mint also found that 44% of UK investors were considering investing in CGT-exempt bullion coins to boost wealth and reduce their tax bill.

Stuart O’Reilly, market insights manager at The Royal Mint said: “Gold prices have had multiple tailwinds in recent months. We have seen interest rates start to reverse course both sides of the Atlantic. Economic uncertainty and heightened geopolitical risk is leading to competition for safe haven assets. This is driving broadly positive market sentiment, fuelling both demand for precious metals, and activity from those looking to realise capital gains.

“Beneath the surface, the type of assets investors prefer is changing. While gold and silver can help investors strengthen and diversify their portfolio, our record quarter for bullion coin sales reflects the renewed focus on tax efficient investing. Our data suggests that investors are increasingly keen to protect their future investment gains, favouring CGT-exempt investments such as bullion coins over products that are subject to CGT. It’s also interesting to see more investors actively using The Royal Mint’s Buy Back Service, reflecting a proactive approach to closely monitoring the market and making strategic portfolio adjustments."