What taxes may apply when buying, selling, gifting or inheriting bullion?

When you buy: VAT

VAT is the tax most likely to affect the purchase price. Gold Krugerrands are always zero-rated for VAT in South Africa as gold coins issued by the South African Reserve Bank. Silver bullion is generally standard-rated, and other gold and platinum products can be treated differently depending on what they are. Whether VAT applies depends on the product and the facts, so check the SARS VAT guidance or ask the dealer whether a quoted price includes VAT.

When you sell: capital gains tax or income tax

Selling bullion for more than it cost can create a taxable gain. A gain on an asset held as a long-term investment is generally treated as a capital gain, while frequent buying and selling with the intention of making a profit may be treated as income instead. Coins made mainly of gold or platinum, such as Krugerrands, are excluded from the personal-use asset category, so a gain is not disregarded simply because the coins were held privately. Keeping purchase invoices helps you work out any gain accurately.

When you give bullion away: donations tax

Giving bullion to another person is generally a donation for tax purposes. Donations tax may be payable by the donor, subject to annual and other exemptions, such as certain donations between spouses, and the gift may also count as a disposal for capital gains tax. Exemption amounts and rates are set by legislation and can change at each Budget, so check the current position on the SARS donations tax pages.

When bullion is inherited: the estate

When someone dies, their bullion forms part of their estate. The estate may be liable for estate duty, and death is generally treated as a disposal for capital gains tax in the deceased person's final tax position. Heirs usually receive assets after the executor has dealt with these liabilities. SARS publishes guidance on estate duty alongside its other tax pages.

Getting the right advice

This is a general overview, not tax advice. Thresholds, exemptions and rates change, and the right answer depends on your residency, intention, records and wider affairs. Speak to a registered tax practitioner, or consult SARS, before making decisions, and keep every invoice for bullion you buy or sell.