The price of gold hits an all-time high of $2,700, and the Royal Mint says buyers are shifting from bars to coins for one key reason.

Brits are buying bullion coins rather than gold bars, the Royal Mint says, as prices rise and customers look to avoid rumored capital gains tax increases.

The price of gold today surpassed the $2,700 per ounce level for the first time, as concerns over the US elections and tensions in the Middle East drive demand for a safe haven for investments.

The Royal Mint says sales of bullion, which is subject to CGT, fell 11 per cent year-on-year in the quarter to the end of September 2024.

This is likely due to concerns that the Chancellor will increase CGT on investment profits to 39 per cent in the Budget on October 30, up from 10 to 20 per cent currently, depending on your tax band.

However, the Mint has seen a boom in purchases of gold and silver bullion coins, for which CGT is not responsible.

The Royal Mint’s bullion coin sales rose to a record level in the same period, with revenue increasing 110 percent compared to the same period in 2023.

The Royal Mint said most of it came from the sale of gold bullion coins.

Also increasing interest in gold is the increase in the price of the precious metal.

Experts expect the price of gold to continue rising in the coming months.

Stuart O’Reilly of the Royal Mint said: ‘Gold prices have had multiple tailwinds in recent months.

‘Below the surface, the type of assets investors prefer is changing. While gold and silver can help investors strengthen and diversify their portfolio, our record quarter in bullion coin sales reflects the renewed focus on tax-efficient investing.

“Our data suggests that investors are increasingly keen to protect their future investment gains, favoring CGT-exempt investments, such as bullion coins, over products subject to CGT.”

How to invest in gold

There are a few main ways to get exposed to the precious metal.

One way is to buy physical bars or coins.

These can be stored at home (ideally with sufficient security and insurance cover) or kept in a secure vault, such as that of the Royal Mint, for a fee.

Certain gold bullion coin products issued by the Royal Mint have the status of legal tender coins and are therefore exempt from CGT and VAT.

You can invest in gold through exchange-traded commodities (ETC). Tracking the price of gold in this way is no different from maintaining a passive investment in a stock index.

These are exchange-traded funds that offer investors exposure to the price of gold, backed by physical holdings of gold bullion held in secure vaults.

You can hold ETC in a Sipp or Isa to protect gains from tax. Investors should be wary of ETFs that gain exposure through derivatives rather than physically holding the precious metal, as they are complex and may include costs that are not immediately apparent to the naked eye.

Another way investors can get exposure to gold is through multi-asset funds.

> What drives the price of gold and how to invest?