GST and VAT Compliance for Gold Traders

As gold continues to play a critical role in wealth preservation, jewellery, and cross-border trade, businesses operating in the precious metals sector must be alert to the complex landscape of indirect tax compliance. This includes Goods and Services Tax (GST) and Value-Added Tax (VAT), which apply differently across jurisdictions and product categories. For traders, refiners, retailers, and investors, navigating these taxes correctly is essential—not just to avoid penalties, but also to maintain smooth operations and profitability.

This article offers a high-level look at GST and VAT rules relevant to gold transactions, with practical examples from Singapore and the United Kingdom. If you’re involved in trading physical gold, importing investment coins, or selling jewellery, these insights will help you better understand the tax landscape and highlight where professional support can add value.

Understanding GST and VAT Compliance for Gold Traders

GST and VAT are broad-based consumption taxes applied to most goods and services in many countries. However, governments often apply exemptions or concessions to specific types of gold—particularly investment-grade gold—due to its role as a store of value. The tax treatment of gold depends heavily on:

The form of gold (e.g., bullion, jewellery, coins)
The purity of the metal
Whether the gold qualifies as an investment asset

Whether the transaction is domestic or cross-border

Singapore: GST and Gold Jewellery Changes from 2025

In Singapore, Investment Precious Metals (IPM) such as 999.9 fine gold bars and LBMA-accredited bullion products are GST-exempt. However, items like gold jewellery, commemorative coins, or collectibles do not enjoy this exemption and are subject to GST at the prevailing rate (9% as of 2024).

From 1 January 2025, the GST concession for trade-ins of gold jewellery will end. Traders will be required to:

Issue a purchase invoice for the traded-in item
Issue a separate sales invoice for the new item
Account for GST on the full value of the new sale

Treat traded-in jewellery as a non-taxable purchase if acquired from a non-GST-registered individual

This change affects POS systems, accounting processes, and customer communications. More info is available on the IRAS website.

United Kingdom: VAT Exemptions for Investment Gold

The UK applies a VAT exemption to investment-grade gold. According to VAT Notice 701/21 and 701/21A:

Gold bars or wafers must have at least 995 purity
Gold coins must be at least 900 purity, legal tender, minted after 1800, and sold near bullion value

These items are VAT-exempt, but sellers must retain supporting documents like assay certificates and include exemption details on invoices. All other forms of gold, including jewellery and industrial gold, are fully taxable.

Cross-Border Compliance for Gold Traders

Cross-border gold transactions present additional challenges:

Import VAT may apply if not using bonded or tax-deferred storage
Reverse charge rules may shift the tax burden to the buyer

Accurate customs and trade documentation is vital
Errors in classification can result in tax assessments and fines

Why Businesses Should Seek Compliance Support

Indirect tax rules for gold are highly technical and easy to misinterpret. Common issues include charging VAT or GST incorrectly, issuing invalid invoices, and failing to meet documentation standards. Businesses should consider working with professional advisors to:

Structure transactions for optimal tax treatment
Conduct GST/VAT risk reviews and system alignment
Ensure invoice and record-keeping compliance

Advise on bonded warehousing and international sales

Conclusion: Proactive Compliance for Gold Traders is a Competitive Advantage

Tax authorities in both developed and emerging markets are increasing scrutiny of gold transactions. Businesses that invest in proper systems, training, and external guidance will be better positioned to operate without disruption and respond quickly to new rules.

Whether you’re a jeweller, refiner, or bullion trader, staying informed about GST and VAT developments is essential. Consider partnering with a knowledgeable advisor who can help ensure your processes remain compliant and efficient.

Get in touch to discuss how to improve your gold-related tax compliance processes.