Gold and Silver Investors Are Getting Caught Out by the ATO

Summary

The video explains how Australian capital gains tax (CGT) can apply to physical gold and silver, and how incomplete records may increase an investor’s tax bill. The presenter emphasizes that tax generally applies when an asset is disposed of—not only when it is sold for cash.

Taxable Disposals

Examples discussed include:

• Selling bullion.
• Swapping silver for gold.
• Transferring bullion into a trust or self-managed super fund (SMSF).
• Gifting a coin.

The presenter says the ATO treats a gift as a disposal at market value, so a capital gain may need to be declared even if no money is received.

The video also discusses detection and reporting. It says precious-metals dealers will be subject to anti-money-laundering rules from 1 July 2026, including AUSTRAC reporting for transactions of $10,000 or more in cash or virtual assets. According to the video, this reporting obligation does not apply to the dealer when payment is made by bank transfer, although the bank retains a transfer record. The presenter warns that large, unexplained deposits could prompt questions about the source of funds.

Four Record-Keeping Risks

1. Cost Base

Without proof of the purchase price, an investor may be unable to substantiate the amount deducted from sale proceeds.

For example, 10 ounces bought for $28,000 and sold for $70,000 would produce a stated gain of $42,000. The presenter estimates that each $10,000 of unsubstantiated cost base could mean about $1,850 more tax at a 37% marginal rate, after the CGT discount and before the Medicare levy.

2. Purchase Date and CGT Discount

The presenter says assets held for more than 12 months qualify for the 50% CGT discount; selling one day before the threshold would not.

On the example $42,000 gain, the discount reduces taxable income by $21,000. The presenter estimates this could save about $7,770 at a 37% marginal tax rate. The purchase date also matters for the future CGT-rule changes described below.

3. Premiums and Other Purchase Costs

Physical bullion may cost more than the spot price. Premiums on some small bars and coins can reach double-digit percentages, and shipping costs may also be relevant.

For example, $50,000 of silver coins bought at an 8% premium has a stated cost base of $54,000. Recording only the spot-price amount would omit $4,000 from the cost base; the presenter estimates this could cost about $740 in tax.

4. Identifying Individual Lots

Each bar or coin purchase has its own cost base and holding period. The presenter says lot-level records can help investors identify which batch is being sold and choose a lot with a lower gain or one that qualifies for the discount. The outcome depends on the selected lot and the investor’s records.

CGT-Rule Change Described in the Video

The presenter says a law passed in June 2026 will replace the 50% CGT discount with cost-base indexation from 1 July 2027. As described, assets held across that date would have their pre-date gain treated under the old rules and their post-date gain calculated under indexation.

The presenter says physical bullion owners would need evidence of each lot’s value on 1 July 2027, since bullion does not have an exchange closing price like listed stocks or ETFs. This is a claim about the rule change as presented in the video.

Record-Keeping Checklist and Tools

At purchase, the presenter recommends recording:

• The total amount paid to the dealer.
• The purchase date.
• The premium above the spot price, including delivery costs.
• The specific bar or coin purchased.

Records can be kept in a spreadsheet, notebook, or software. The video demonstrates lot-based calculations using first-in, first-out, last-in, first-out, and manual lot selection. It also promotes Navexa as a portfolio-tracking and tax-calculation tool.

Assets and Instruments Mentioned

• Physical gold and silver bars and coins.
• Stocks and shares.
• ETFs.
• Cryptocurrency.
• Trusts and SMSFs.
• Bank transfers, cash, and virtual assets.

Disclosures and Source

The supplied subtitles do not include an explicit “not financial advice” disclaimer.

Presenter: Navarre Trousselot, founder of Navexa. Navexa is the platform demonstrated in the video.