You must notify HMRC within 28 days of making your first exempt supply of investment gold that exceeds £5,000, or of the point where your supplies to a single customer exceed £10,000 in any 12-month period. The requirement is in section 3.1 of VAT Notice 701/21, and it applies whether or not you are VAT-registered.
Separately, you must keep a register of investment gold transactions with verified customer identity, retained for at least six years. The penalty for failing to keep it is normally 17.5% of the value of the transactions concerned.
What counts as investment gold
Get this wrong and everything downstream is wrong. Notice 701/21 paragraph 2.1 defines investment gold as:
(a) Bars and wafers - gold of a purity of not less than 995 thousandths, in the form of a bar or wafer of a weight accepted by the bullion markets.
(b) Gold coins minted after 1800 which are of a purity of not less than 900 thousandths, and are or have been legal tender in their country of origin, and are normally sold at a price not exceeding 180% of the open market value of the gold contained in the coin.
(c) Coins on HMRC's published list - see Notice 701/21A, which lists specific coins HMRC accepts as investment gold.
Investment gold supplies are exempt from VAT, not zero-rated. The distinction matters: exempt supplies do not carry a right to reclaim related input tax in the normal way, and they interact with partial exemption if you also make taxable supplies. If investment gold is more than an occasional line for you, partial exemption is a conversation to have with your accountant before it becomes a correction.
Note also what is not investment gold. A 22ct sovereign is in scope. A 9ct chain is not - that is scrap, and belongs in the gold reverse charge. A gold bar of 916 fineness is not investment gold under (a), because it misses 995.
The notification, precisely
Two triggers, either of which starts the 28-day clock:
| Trigger | Threshold |
|---|---|
| Your first exempt supply of investment gold exceeding | £5,000 |
| Supplies to a single customer in any 12-month period exceeding | £10,000 |
Notify the Written Enquiries Section. If you are not VAT-registered, Notice 701/21 requires you to give your name, incorporation details, addresses, phone number, a contact person, your accountant's details and any associated VAT numbers.
The acknowledgement is part of the obligation. The notice says the Gold Team will send an acknowledgement, and that if you do not receive it within 28 days you must check that they received your notification. Sending it and hearing nothing is not discharge. Diarise the follow-up.
The second trigger is the one that catches people. A regular customer buying £900 of sovereigns eleven times over ten months has crossed £10,000, and it is a rolling 12-month window rather than a tax year. If you do not track cumulative supplies per customer, you will not see it coming.
The register
Section 7 of Notice 701/21 requires records to be kept for at least six years from the date of the transaction, including the purchase invoice you receive.
For each investment gold transaction, paragraph 7.1(b) requires customer records showing:
- A unique reference number
- Name
- Date of birth
- Address
- Telephone number
- Copies of identification documents from HMRC's specified lists - passport, driving licence, utility bills and so on
Certified copies must be signed and dated by you.
Two things worth saying plainly about this. First, it applies to exempt investment gold supplies regardless of value and regardless of payment method - it is not the same test as the AML high value dealer threshold, and satisfying one does not satisfy the other. Second, "we know him, he's been coming in for years" is not a record. The register wants a document with a date on it.
The penalty
Section 9 of Notice 701/21: the penalty for failure will normally be 17.5% of the value of the transactions concerned.
That is a percentage of transaction value, not of profit. On £120,000 of sovereign sales through a year with an incomplete register, that is £21,000 - on a product line whose gross margin is measured in low single-digit percentages. Investment gold is a thin-margin business where a compliance failure can exceed several years of the profit it generated.
HMRC cannot assess more than four years after the transaction date, or more than two years after they had sufficient facts to make the assessment. There is a reasonable excuse provision, but the notice states that insufficient funds or reliance on information from a third party do not qualify.
The option to tax, and the reverse charge
Investment gold is exempt by default, but a seller can in certain circumstances opt to tax supplies to another taxable person. Where that happens - and for supplies between LBMA members and non-members - the transaction falls into the Special Accounting Scheme in section 11, and the buyer accounts for the VAT rather than the seller charging it.
This is a genuinely technical corner and it is where the exempt and reverse-charge regimes touch. If you are considering opting to tax, take advice first; the interaction with your input tax recovery is the point of doing it and also the thing most easily got wrong.
The AML layer sits on top
Investment gold plus cash is the combination that attracts attention, and rightly so.
If you accept or make cash payments of £10,000 or more for goods, in a single transaction or in linked payments, you must register with HMRC as a high value dealer before you take the money. Since 30 June 2026 that threshold is a flat sterling £10,000 rather than €10,000. See our piece on high value dealer registration.
So a £12,000 cash sale of sovereigns engages three separate regimes at once: VAT exemption and the notification clock, the investment gold register, and HVD registration with customer due diligence and a five-year AML record. They have different thresholds, different retention periods and different penalties. None of them substitutes for the others.
A practical routine
- At the point of sale, classify: is this investment gold under 2.1(a), (b) or (c)? Record which.
- Take and file the ID with a unique reference, at every investment gold sale, not just large ones.
- Keep a running cumulative total per customer on a rolling 12-month basis.
- Watch two thresholds: your first single exempt supply over £5,000, and any customer passing £10,000 in 12 months.
- When either trips, notify within 28 days - and chase the acknowledgement at day 28.
- Retain six years. That covers the VAT requirement and comfortably covers the five-year AML one.
Sources
- Gold acquisitions, imports, investments and VAT (VAT Notice 701/21) - GOV.UK, sections 2.1, 3.1, 7, 9 and 11
- Investment gold coins (VAT Notice 701/21A) - GOV.UK
- ECSH51525 - Introduction to high value dealers - HMRC internal manual
This is general information, not tax advice. Investment gold sits at the intersection of VAT exemption, partial exemption, the special accounting scheme and AML supervision, and the interactions are genuinely difficult. Confirm your position with a VAT specialist before you start or expand a bullion line.
WatchCRM keeps the investment gold register as a first-class record with the ID attached, and tracks cumulative exempt supplies per customer so the 28-day notification clock is flagged rather than discovered. It keeps that separate from the AML cash trail, because HMRC treats them separately.