Why are Gold and Silver Bullion Bars cheaper than the equivalent Coins?

When considering a purchase of Gold or Silver items, there are several options that you may consider: Jewellery, Bullion Bars, or investment-grade Coins. The lowest price of these options is typically minted or cast bars, but why is this the case?

Jewellery is made to look nice and to be seen, but will usually have a lower Gold or Silver content (purity) being alloyed with other metals for durability purposes, and also at a high production cost due to design or extras, such as precious or semi-precious gemstones. VAT is levied on Jewellery items, which will currently add 20% to the price tag in the UK.

Gold Coins are VAT free and usually of a higher purity than most jewellery items, but like jewellery will incur a higher manufacturing cost. Minted Gold coins are typically struck many more times than circulated currency, and will usually have a nominal face value as legal tender in the country of origin. This will be much less than the value of the Gold or Silver content. Some coins will have a limited mintage per year and all will be dated.

Gold Sovereigns and Gold and Silver Britannia Coins from the Royal Mint are legal tender in the UK, and are therefore exempt from Capital Gains Tax.

Minted and cast Gold and Silver Bullion Bars will usually be of a higher purity than Bullion Coins or Jewellery items, and to the London Bullion Market Association (LBMA) Good Delivery standard of at least 995 parts per thousand of the precious metal, or a guaranteed minimum of 99.5% Gold or Silver per bar. They are almost always never dated on the bars, and there is usually no limit on production.

Bullion Bars also typically have less intricate designs (especially so with cast bars), thus reducing the manufacturing costs, and are made as a store of wealth rather than a fashion statement or legal tender.

Our prices track the latest market price which is updated on our secure online store up to every three minutes; this, combined with our competitive rates, ensures that you will pay the lowest possible amount for your items, whether you choose coins or bullion bars. Many of our items are discounted on bulk purchases.

To see our current stock of Gold and Silver coins click here and our investment bars are available to view here.