KCIII Silver Britannias and EPD

[MR_C]

Hi recently I tried, unsuccessfully, to participate in the EPD, in order to earn the holders yield.

I find it a bit of a mystery as to why I can't use the KCIII Silver Britannias I have been stacking for the last 6 months or so.

Any thoughts anyone?

 

[Uchiki]

Interesting.

What feedback did you get?

They are 99.9% silver, so there shouldn't be a problem there.
With any segregated EPD, you'd need to meet the minimum minting threshold of 200oz.

You'd also have the assay requirement to be done..

 

[Lozion]

ABX approved refiners for non-segregated EPD. Otherwise you need assaying.

 

[sixgun]

Assuming you are minting enough ounces, i would get a clear idea on the cost of this and then compare with holding straight KAG / KAU.

How would it look compared to selling the coins (probably the best price would be privately) and then sending the cash to Kinesis. Cash is a lot simpler and cheaper than EPD.

i am guessing you are in the UK. i don't know where you got the coins and whether you paid sales tax. Selling to a dealer would almost certainly work out as a big loser, so now you have coins you might be thinking why not get a yield rather than keeping them in a box under the stairs or wherever. I suspect for a lot of people EPD doesn't add up hence you really need to do the number crunching first.

I have a pretty decent silver stack but wouldn't consider EPD. I have monster boxes of 500 coins but still wouldn't. i haven't done the sums but i keep my Kinesis metal and my in hand physical metal separate. i have a friend who is looking into EPD and maybe it will work out but i think i would send freshly minted / fresh purchased silver/gold straight to Kinesis. i have such a diverse collection i think assay could work out pretty costly.

There is one potential advantage Uchiki and I kicked around, which was that if a UK tax resident did use British coins for EPD their KAG or KAU are tokens of ownership over your identified British coins. So selling KAG / KAU would be selling British coins. British coin sale gains for UK tax residents are tax free, as long as you aren't making the coin sales as a business. You wouldn't have to declare any gains that might occur which of course would make life simpler if you were in the business of declaring such gains.

 

[sixgun]

ABX approved refiners for non-segregated EPD. Otherwise you need assaying.

View attachment 4447

I wonder when this list was updated - straight off the bat, Johnson Matthey precious metals refining operations were taken over by Asahi Holdings in 2015. There are no new JM bars / rounds anymore.

 

[Lozion]

I wonder when this list was updated - straight off the bat, Johnson Matthey precious metals refining operations were taken over by Asahi Holdings in 2015. There are no new JM bars / rounds anymore.

An old list indeed, I did my EPD in Sept 2021

 

[MR_C]

Thanks for the replies, I put Royal Mint, (?) as the refiner on the form, not sure if that's correct,

also was trying to send in 500 oz, maybe I should have put 400 oz , so it's divisible by 200 oz?

Also, as a UK resident, when it comes to selling, are the proceeds definately still exempt from CGT?

Has this been confirmed by HMRC?

 

[MR_C]

Also, what if you buy, store and sell Silver Brittannias in say, the USA,

are the proceeds still exempt from CGT, when you transfer the currency back to the UK?

 

[Uchiki]

Thanks for the replies, I put Royal Mint, (?) as the refiner on the form, not sure if that's correct,

Are you attempting to do standard or segregated EPD?
The criteria for standard EPD will be more rigorous and is more focused on bars, whereas segregated takes a wider range of bullion, including coins.

As sixgun noted above, you will likely have paid a significant premium over spot for these coins.
While you will only be credited for the silver content as KAG, by doing segregated EPD, you will retain the opportunity (subject to the terms) to withdraw the same coins if you want to sell - and therefore the potential of recouping some of the premium.
The downside of course are the additional costs.

I did a quick overview of standard and segregated EPD here (<2mins for the relevant sections):


Here's the start point on the Kinesis website.

Exchange Physical for Digital (EPD) | Kinesis Money

Find out how to exchange physical metals for Kinesis currencies where you can earn a yield on your earnings plus zero storage fees.

kinesis.money

The image next to the segregated option appears to show a Silver Britannia, so it would be surprising if these are not accepted for segregated EPD.

also was trying to send in 500 oz, maybe I should have put 400 oz , so it's divisible by 200 oz?

I would follow up any response to your EPD request about this. While the minimum threshold is going to be 200oz, it may be possible to do part of a minting unit if you have already exceeded the minimum.
As an example, a 1000oz silver bar is likely to vary either side of 1000oz, but provided it matches other criteria, is going to be accepted for EPD.

Also, as a UK resident, when it comes to selling, are the proceeds definately still exempt from CGT?

As sixgun mentioned, an idea that we've kicked around is if your KAU holdings were based solely on gold sovereigns, then your KAU represents those sovereigns.
If you sell/spend some KAU, you lose legal ownership of the related weight of sovereigns.
So, you may be able to argue that you have sold/spent the sovereigns and therefore don't have a tax event.
From my point of view, it's just an idea that I currently have at the back of my mind.
If you want a definitive answer on this, it would be best to consult a tax adviser.

Also, what if you buy, store and sell Silver Brittannias in say, the USA,

are the proceeds still exempt from CGT

Royal Mint's page on this talks about UK residents (you indicated you are) and legal currency (in your case, Britannias).
I don't have a tax background, so take any comments with a pinch of salt, but personally I don't see why the place or purchase or disposal would make a difference from a UK tax point of view.

https://www.royalmint.com/gold-price/capital-gains-tax-on-investments/

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