Get more silver for your money

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

Unlike gold, if you want to invest in silver, platinum or palladium, then legally you will have to pay the value added tax or duty that the tax authorities apply. For investors, this means that they can buy significantly fewer silver coins or ingots for their currency. Nevertheless, there are alternative ways of purchasing these white precious metals without taxation. The solution is so-called bonded warehouses, also known as duty-free warehouses, located in Switzerland.

These logistics 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.

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.

-> Learn more about OZL and ZFL warehouses in Switzerland and Liechtenstein.

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.

-> Learn more about segregated precious metal storage.

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 999.9/1000 Australia
AUSTRALIAN KOOKABURRA 999.9/1000 Australia
BRITANNIA 999.0/1000 United Kingdom
CHINA PANDA 999.0/1000 China
HELVETIA SILVER (from Echtgeld Ltd) 999.0/1000 Switzerland
LUNAR SERIES II 999.9/1000 Australia
MAPLE LEAF 999.9/1000 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
  • 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 7.7 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.

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