The most common question first-time gold investors ask is which 1oz gold coins should they invest in. To answer this question, the first thing to know is the most popular options, which is the Britannia and the Krugerrand.
See how they compare below:
The Britannia is the 1oz British equivalent of the South African Krugerrand. The Krugerrand is 22 carats and while the Britannia is 24 carats. The Britannia experienced a surge in popularity worldwide since 2013 when manufacturers started making them in 24 carat gold. Although the distinction between 22 carats and 24 carat is not really a huge issue in the UK, in other countries, the gold’s purity is of cultural and traditional significance.
It is hugely popular in the UK mainly because it is a legal tender, which means that CGT or capital gains tax-free. For many United Kingdom citizens, CGT allowance is a common source of worry and 1oz Britannia or British gold coins are a great tax-free investment.
The Krugerrand is likewise a great starting point for first-time gold investors because it is easily tradable, affordable and popularity. The South African Chamber of Commerce produced it in 1967, 20 years prior to the introduction of the Britannia by the Royal Mint. This means that Krugerrands are most common 1oz gold coins.
The Krugerrand has always had the same design, purity, and dimensions, and while it is pure 1oz gold inside, it weighs more since it is 22 carats, with approximately 8% of copper alloy, and therefore is more durable than a Britannia and less likely to be devalued due to surface damage.
While Britannia is more costly, you save money because it is CGT-free. Krugerrands, on the other hand, are more economical and will provide ample profit, but purely from an investment perspective. That said, if you are looking to avoid a potential CGT headache and have money to spend, consider the Britannia. If you do not care about CGT and do not have that much money to spare, consider the Krugerrand.