Buying Silver Without VAT

Additional information > Investment forms for gold, silver, platinum and palladium > Buying Silver Without VAT

Buying silver without sales tax – or VAT – is easy for investors by using bonded warehouses. This is because anyone who wants to invest in silver, platinum or palladium must take the statutory sales tax into account when buying. Purchasing silver without sales tax means that investors can buy more coins or bars. Find out how it works it here.

Both bonded warehouses or duty-free warehouses allow you to obtain silver without worrying about tax

In contrast to gold, the purchase of white precious metals is subject to sales tax. Consequently, investors must take into account that they will obtain significantly less white metal for their money. Nonetheless, there are alternative and completely legal ways to save on paying the due sales tax. The solution is so-called bonded warehouses or open bonded warehouses in Switzerland, such as those offered by Swiss Gold Safe.

These warehouses enable the duty-free acquisition and sale of physical silver without taxation. This is because the customer does not actually get his or her hands on the commodity, but buys it from a dealer who delivers it directly to the warehouse. This type of storage is equally suited to private investors as well as business investors from Switzerland, Liechtenstein and other countries. By doing so, investors benefit from the particularly secure and stable political conditions in Switzerland.

Benefits of duty-free storage

Tax-free storage of precious metal has a number of advantages. Firstly, the stock is kept safely in interim storage facilities and are always 100 per cent owned by the buyer despite no duty having been paid on them. The storage is reliable, discreet and covered by comprehensive insurance protection. Usually, there is no storage restriction and there are no upper limits as to how much can be kept. Buying and selling are both possible at any time. Apart from the storage service, the collection and shipping of a stock of precious metals is usually possible by arrangement, too.

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The difference between open bonded warehouses and duty-free warehouses

There are some differences in the high-value storage found in open bonded warehouses (OZL) and duty-free ones (ZFL). For instance, the stock levels and all of the movements of goods in so-called duty-free warehouses are directly monitored by the Swiss customs authorities and by the warehouse’s own employees. On the other hand, open bonded warehouses are managed by private operators. Nevertheless, customs officers regularly monitor stocks and their movements, even those stored by private providers, via online direct access systems.

Swiss Gold Safe offers its customers storage in both open bonded warehouses and duty-free warehouses in Switzerland where the purchase and sale of silver is possible without value added taxation. In addition, clients receive a comprehensive insurance cover against the unlikely loss of their valuables via a partnership arrangement with Lloyds of London.

Which precious metals are recommended for storage in ZFL and OZL facilities?

While investors need to buy larger quantities of silver to achieve the equivalent value of gold, there are many benefits to this course of action. If necessary, smaller amounts can be sold or added at any time, for example. In addition, this form of investment is also suitable for beginners. Indeed, silver – as a precious metal – is available in many different forms: coins, coin bars and classic silver bars. All these forms of silver are suited for both buying and storing in an open bonded or a duty-free warehouse.

Investors should focus on top-quality silver with a high purity level when choosing which form they wish to invest in. Silver coins with a minimum value of at least 99.9 per cent purity should be focussed upon since these have a high resale value. Safe investment options include the China Panda, the Maple Leaf and the Vienna Philharmonic. A selection of popular bullion coins can be found below. The troy ounce of silver weighs 31.1 grams and this is an important unit for the comparison of such coinage.

Well-known international silver coins:

Name	Purity	Country
AMERICAN EAGLE	999.0/1000	USA
AUSTRALIAN KANGAROO	999.0/1000	Australia
AUSTRALIAN KOOKABURRA	999.0/1000	Australia
BRITANNIA	999.0/1000	United Kingdom
CHINA PANDA	999.0/1000	China
HELVETIA SILVER (from Echtgeld Ltd)	999.0/1000	Switzerland
LUNAR SERIE II	999.0/1000	Australia
MAPLE LEAF	999.0/1000	Canada
VIENNA PHILHARMONIC	999.0/1000	Austria

Customers who do not wish to pay any tax on their silver purchase can do so from our partner, Echtgeld Ltd. , for example, which delivers directly to both ZFL or OZL storage facilities. In fact, silver bars in popular sizes, such as 1 kg, 5 kg or 15 kg, can be purchased and stored in just the same way. Below you will also find an overview of well-known ingot producers.

Well-known Swiss and international silver bar producers:

Argor-Heraeus SA, Switzerland
Cook Island (Heimerle & Meule GmbH), Germany
Doduco GmbH, Germany
ESG Edelmetall-Service GmbH, Switzerland and Germany
Metalor Technologies SA, Switzerland Argor-Heraeus SA, Schweiz Metalor Technologies SA, Schweiz
Pamp SA, Switzerland
Perth Mint, Australia
Royal Canadian Mint, Canada
Umicore AG & Co. KG, Belgium
Valcambi SA, Switzerland

What happens when you sell silver stored in a duty-free warehouse?

If silver or other precious metals, such as platinum or palladium, leave a tax-free zone and are sold, it is usual for a fee to be applied. Furthermore, the full value added tax due must be paid if is the case that the physical removal the precious metal has actually taken place. In Switzerland and Liechtenstein, the tax rate since January 1, 2018, amounts to 8.1 per cent. However, if the silver were to be exported to Germany, for example, then a 19 per cent sales tax will be levied. That said, investors usually sell directly from the ZFL or the OZL to traders who also store on a duty-free basis, so that no tax is liable at all.

Conclusion:

In order to avoid the value added tax on silver purchases, both private investors and business buyers can turn to duty-free or open bonded warehouses in Switzerland. By saving on tax, you can purchase much more of the white precious metal than would otherwise be possible. Such facilities are recommended for either coins or bars in classic denominations. Your stock of precious metal is safely stored by Swiss Gold Safe and can be sold or added to through our partners. As such, the purchase of duty-free silver stock is a real possibility.

FAQs – Answers to Frequently Asked Questions

How can I buy and store silver free of sale tax?

The purchase of white precious metals such as silver, platinum and palladium is subject to sales tax. This is the case unless you buy it from a Swiss precious metal dealer and have it delivered directly to a bonded warehouse or an open bonded warehouse.

Which country has the lowest sales tax rate on silver in Europe?

In Europe, different sales tax rates apply when silver is bought. Austria: 20% per cent, Italy: 22 per cent, Germany: 19 per cent. Switzerland has the lowest rate at 7.7 per cent.

What is the level of sales tax applied to silver in Switzerland?

When buying silver and other white precious metals, sale tax in Switzerland is 7.7 per cent. It has remained at this level since 2018. However, you can buy and store silver free from sales tax through precious metal traders.

Do I have to pay sales tax on silver purchased for investment?

In most European countries, gold purchases are exempt from sales tax. For silver, however, value added tax still applies.

Are there silver coin bars for sale in Switzerland?

Silver coin bars are only rarely offered in Switzerland.