General information on the taxation of buying and selling precious metals

Aurovelis.com, a subsidiary of the AuCOFFRE.com group, provides you below with a summary and non-exhaustive presentation of the taxation likely to apply to transactions involving the purchase and sale of precious metals.

However, it should be remembered that the application of tax rules may depend on the individual situation of each party involved, so it is essential to consult a legal professional in order to obtain individualised advice.

Taxation when buying precious metals, coins or collectibles: should VAT be applied?

Aurovelis.com, drawing on the expertise of the AuCOFFRE.com group, informs its members about French tax regulations relating to transactions involving precious metals. Here are some explanations on the taxation of precious metals that may help guide your choices.

If I buy gold

Value added tax (VAT) is essentially a general tax on consumption that applies to supplies of goods and services located in France. Consequently, and as a matter of principle, the acquisition of bars or coins should be subject to VAT.

However, there is a specific regime for “investment gold”.

What is investment gold?

• Bars, ingots or plates: These products must weigh more than one gram and have a purity equal to or greater than 995 thousandths.
• Coins: Coins must meet three cumulative conditions:
  • Have been minted after 1800;
  • Have, or have had, legal tender status in their country of origin;
  • Be usually sold at a price that does not exceed the free market value of the gold they contain by more than 80%.

Transactions involving investment gold benefit, as a matter of principle, from a VAT exemption (purchases made in France, in the EU or outside the EU).

To benefit from this exemption, certain details must obligatorily appear on the purchase invoice:

• The name of the coins;
• The year and country of issue;
• The weight in gold and the fine gold price on the free market on the day of delivery. However, these last two details are not required if the coins appear on the annual list published by the European Commission.

Conversely, if the product acquired does not meet the definition of investment gold, it is subject to VAT at the rate of 20%.

Sources: Article 298 sexdecies A of the French General Tax Code (CGI), Article 98 B of Annex III to the CGI, BOI-TVA-SECT-30-10

If I buy silver

There is no equivalent scheme to that of investment gold. Therefore, the acquisition of silver products from a professional located in France results in the application of VAT at the rate of 20%, in the same way as all ordinary consumer goods.

It is however possible to fall under a particular regime, that of second-hand goods, when the product is sold by a person with “reseller” status and it involves coins or collectibles or objects composed of precious metals (such as jewellery items).

In this case, the purchase is indeed subject to VAT at the rate of 20%, but on the margin made by the reseller and not on the total sale price.

Sources: Article 256 of the CGI, Article 297 A of the CGI, Article 261 C of the CGI, Article 98 A of Annex II to the CGI, BOI-TVA-SECT-90-20

If I buy coins that are legal tender

Coins that are legal tender in their country of origin and that do not meet the previous definitions of investment gold or collectibles are exempt from VAT.

Sources: Article 261 C of the CGI

Taxation when selling precious metals, coins or collectibles: the specific features of the precious metals tax

The precious metals tax is a specific tax regime that applies to onerous transfers or exports of precious metals carried out by French tax residents. Here is a summary presentation of the main applicable rules, tax rates, options and exemptions provided for by this regime.

Am I concerned by the precious metals tax?

This tax applies to onerous transfers or exports of precious metals, jewellery, works of art, collectibles or antiques.

Conversely, it does not apply:

• In the case of a gift of precious metals,
• If the seller is not a French tax resident,
• If the seller is a company.

The precious metals covered by the tax include:

• Gold (including platinised gold);
• Platinum (excluding other metals such as palladium, rhodium, etc.);
• Silver (including gilded or vermeil silver and platinised silver);
• Waste and scrap of precious metals or of plated/doubled precious metals;
• Gold and silver coins minted after 1800 (coins minted before this date are nevertheless considered as collectibles).

Also covered are jewellery, works of art, collectibles or antiques, and in particular articles of jewellery or fine jewellery and their parts in precious metals or in plated/doubled precious metals, silverware or other works in precious metals.

Worked gold and silver objects are classified among jewellery and similar items, by analogy with jewellery, and therefore do not fall under the category of precious metals.

Sources: Articles 150 VI to 150 VM of the CGI, BOI-RPPM-PVBMC-20-10

What is the amount of this tax?

The tax is calculated on the transfer price or, in the case of export, on the customs value. The applicable rates are as follows:

Category	Flat-rate tax	Capital gains regime on movable property
Precious metals (CFMP)	11.5% (including 0.5% CRDS)	36.2% on capital gains: 19% + 17.2% social levies. 5% allowance beyond the 2nd year of holding. Exemption beyond the 22nd year of holding.
Jewellery and similar items (tokens) / Collectibles (CFBA)	If transaction < €5,000: no tax If transaction > €5,000: 6.5% (including 0.5% CRDS)	If transaction < €5,000: no tax If transaction > €5,000: 36.2% on capital gains (19% + 17.2% social levies). 5% allowance beyond the 2nd year of holding. Exemption beyond the 22nd year of holding.
Movable property – Legal tender coins (CFBM)	Not applicable	If transaction < €5,000: no tax If transaction > €5,000: 36.2% on capital gains (19% + 17.2% social levies). 5% allowance beyond the 2nd year of holding. Exemption beyond the 22nd year of holding.

It is however possible to opt for a different taxation: the standard regime for capital gains on movable property.

In this case, only the capital gain actually realised is subject to tax at a rate of 19% and social levies at a rate of 17.2% (i.e. an effective total rate of 36.2%). In the event of a capital loss, no tax is due.

In addition, under this regime you benefit from a holding-period allowance of 5% per year from the 3rd year of holding, allowing total exemption after 22 years.

This option is particularly attractive if the sale results in a capital loss or if you can claim exemption due to the holding period.

To benefit from this optional regime, however, the following conditions must be met:

• Proof of the date and purchase price: the seller must be able to establish, conclusively, the date and purchase price of the item. This proof can be provided using documents such as an invoice, an inventory drawn up by a bailiff or an insurance contract;
• Holding period of more than 22 years: failing to be able to prove the date and purchase price, the seller may opt for the standard regime if they prove that the item has been held for more than 22 years. This proof relies on documents demonstrating the age of possession.
• Individualisation of the item: For certain items, particularly precious metals, the object or lot of objects must be sufficiently individualised (serial number, engraving, sealed packaging, deposit account, etc.).

Sources: Articles 150 VI to 150 VM of the CGI, Article 150 UA of the CGI, Article 74 S septies of Annex II to the CGI, BOI-RPPM-PVBMC-20-20

How should I declare my sales transactions and pay this tax?

If the transactions are carried out by the individual, without any intermediary involvement, the seller must declare the tax and pay it directly to the tax office within one month of the transfer using declaration form No. 2091-SD.

If, however, the transaction is carried out with the involvement of an intermediary tax-resident in France, such as AuCoffre.com, the tax is declared and paid by this intermediary. The seller has nothing to do; the intermediary returns the transfer price to them, net of the tax paid on their behalf.

In the event of opting for the standard regime for capital gains on movable property, the same declaratory obligations apply; only the form to be used differs (No. 2092-SD).

Breaches of the tax obligations related to this tax are punishable by a tax fine equivalent to 25% of the amount of the duties evaded, to which late payment interest is added. It is therefore advisable to be vigilant and to consult a legal professional.

Sources: Articles 150 VI to 150 VM of the CGI

A question about taxation?

Our team is available for any question relating to the taxation of buying and selling precious metals.