November 6 2020
By law, you cannot simply buy gold coins and bars and preserve them in your house (1). You will need the custodian to do this for you also.
Keep in mind that authorized custodians are required to offer storage solution in the form of depositories (2). The depositories have a repertoire of safety factors including uninterrupted monitoring and they come in two kinds.
1. Segregated storage: This type of repository avails a personalized area of the depository particularly for your bars and coins. This option is generally available for coins and bars weighing over 10 ounces. The moment you withdraw your assets, you’ll get a similar number of bars and coins that you invested in the first place.
2. Non-segregated storage: The coins and bars of separate clients are stored in the same place. This is not that big of a deal as on withdrawal you will be given bars of the same purity and weight and the fabrication is handled by the same refinery and coins of an identical year and category. The only distinction is that it won’t be possible to take out the very same coins and bars you had put in when starting out.
There exist two methods to handle this:
Withdrawing cash after a liquidation In this technique, the custodian will deal with the asset liquidation process After they have done that, you can take out the cash that has grown and the investor is liable to remit tax on this amount at a pre-planned amount.
Physical withdrawal of the previous metal: Through this avenue the custodian releases the original gold bars and coins to the owner who then changes it for money. It is not advisable to utilize this process as you will have to taxed two times; first as you withdraw and the second time as the gold is liquidated.