Bullion Buying Guide

We’ve outlined some good things to know when considering investing in gold. This should give you a clearer idea about what kind of investment would be the right choice for you, though should you wish for any more advice please get in touch.

Gold Bars

Investing in gold bars is usually the most cost-effective way to purchase physical gold. This is because manufacturing costs are much lower, compared to the production of intricate coins. Exceptions to this are the smaller (1g-5g) gold bars that are often bought as gifts.

It is generally more cost-efficient to buy 1kg of gold in a single bar than it is to buy 4 x 250g bars. However, though this brings a lower premium, it offers little flexibility when you may wish to sell your gold, which is something you should consider when making your purchase.

Gold Coins

At Sonny’s we only supply gold coins manufactured by the world’s largest mints, trusted globally by leading bullion services. Though gold coins have slightly higher premiums compared to gold bars, due to manufacturing costs, coins provide a much more flexible investment.

Premiums for gold coins are generally bought at higher premiums compared to investment bars, due to the costs of manufacturing and the limited number of each coin produced each year.


Giving you some flexibility with your gold is often more favourable than benefiting from a slightly lower premium. For example, purchasing the 4 x 250g gold bars instead of just 1 x 1kg bar, would give you 4 x more flexibility for a slightly higher premium. This means you’d have the option to release part of your investment if needed - without having to sell the whole 1kg at once.

Finding the perfect level of flexibility will differ from investor to investor, depending on individual investment portfolios and total holdings. We’re always on hand to offer advice on this, though generally speaking – our best-selling 100g bars usually offer the desired balance between flexibility and value for most. For investments over £100k, our 1kg bars are the most popular.

Gold coins however, are one of the most flexible ways to invest in physical gold, due to their standardised unit size. 

Understanding Capital Gains Tax (CGT)

Capital Gains Tax (CGT) is a tax paid on the profit when you sell, or give away, an asset that has increased in value since you first invested. CGT applies to a wide range of assets including a second home, shares or bullion.

Every individual has an annual CGT allowance. Any profits below the allowance limit are exempt from CGT, whilst gains over your allowance will be subject to tax in line with HMRC guidelines. For the 2019/20 financial year, the CGT allowance is £12,000, but it is recommended to check with HMRC for the most up to date information.

British Sovereign and Britannia coins are exempt from CGT, as they’re classed as UK legal tender. If you think CGT could be an issue for you, you may want to consider investing in British gold sovereign and Britannia coins instead of gold bars. Though this could attract a slightly higher premium when purchasing your gold – it could give you large savings when you decide to sell.