In short
- Investment silver of 99.9 per cent purity, as bars, wafers or bullion coins, carries no GST from a dealer. Collector and proof coins can carry GST.
- Bullion dealers are covered by Australia’s anti-money laundering law, so they check who you are on larger purchases.
- A cash payment of $10,000 or more is reported to AUSTRAC.
- Keep your receipt. It is part of your record for tax when you later part with the metal.
Before you walk in
You have looked up “silver near me”, found a dealer, and you are ready to go in. It helps to know what will happen at the counter, so nothing surprises you. Most of it comes down to three things: GST, ID, and how you pay.
GST: which silver carries it
The tax office’s ruling on precious metals sets the line. In plain terms: in Australia, buying investment gold (99.5 per cent pure), silver (99.9 per cent) or platinum (99 per cent) as bars, wafers or bullion coins from a dealer carries no GST. Collector and proof coins are not counted as investment metal, so GST can apply to them.
So a plain bar or a bullion coin of 99.9 per cent silver from a dealer comes without GST. How proof and collector coins differ from bullion coins is set out in Silver coins: bullion, proof and collector coins.
ID: why the dealer asks who you are
Bullion dealers are covered by Australia’s anti-money laundering law. Under that law, a dealer must check who you are on larger purchases. That is the law working as meant, not the dealer being nosy. It can help to bring photo ID if you plan a larger order.
Cash: the $10,000 report
If you pay in cash, the amount counts. A dealer reports any cash payment of $10,000 or more to AUSTRAC, Australia’s financial intelligence agency.
A report is not an accusation. It is a routine report the law requires dealers to make. Paying by bank transfer or card leaves its own record in your bank statement.
Why a bullion coin’s face value sits far below its silver is covered in Silver coins: bullion, proof and collector coins.
Keep the receipt
Your receipt shows what you paid, when, and for what. When you later part with the metal, any gain is usually a capital gain. How that is taxed, and the open question on coins as collectables, is set out in Silver coins: bullion, proof and collector coins.
My view
My own view is that silver, with its everyday use by technology makers, has a bigger part to play than most people give it credit for. That’s my opinion. You may not agree, and that’s fine.
One easy next step
If you would like the metals lessons in order, from what bullion is to how it is stored and taxed, the free lessons by email walk through each one in plain words. All you need is your first name and email.
Nicholas holds some of the assets discussed in this article.
Education only, not personal or financial advice.