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HMRC internal manual

VAT Single Market

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HM Revenue & Customs
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Particular types of transaction: gold

Introduction

Transactions involving the physical delivery of gold are generally treated in the same way as any other goods. However, there is an important exception in the case of the supply of gold to a Central Bank such as the Bank of England and La Banque de France.

Law

The Value Added Tax (Treatment of Transactions) (No 2) Order 1992

1 This Order may be cited as the Value Added Tax (Treatment of Transactions) (No 2) Order 1992, and shall come into force on 1st January 1993.

2(1) Where gold is supplied to a Central Bank by a supplier in another member State, and the transaction involves the removal of the gold from that or some other member State to the United Kingdom, the taking possession of the gold by the Central Bank concerned is not to be treated for the purposes of the Value Added Tax Act 1983 [VAT Act 1994] as the acquisition of goods from another member State.

(2) For the purposes of this article, gold includes gold coins.

Effect

As a result of the Order, Central Banks receiving gold are not required to account for acquisition VAT when the gold is removed to the UK. This relief is necessary as not all Central Banks are registered for VAT being quasi-governmental bodies. It mirrors the VAT (Imported Gold) Relief Order 1992 under which the importation of gold from a place outside the EC is relieved from VAT when the importer is a Central Bank. This in turn reflects the requirements of Article 143 (k) of the Principal VAT Directive.

For more information about the VAT treatment of gold see the manual covering VAT on gold (VGOLD1000).