Investing in gold has been a popular choice for people in the UK, as it helps preserve wealth and protect against economic ups and downs. With more people wanting physical assets, knowing the different types of gold coins available for smart investment decisions is important.
Two of the most popular options are the Gold Britannia and Gold Sovereign coins, each with benefits and historical importance. This article will look at these two iconic British coins, highlighting their features, advantages, and how they can be part of your investment.
At NextDayBullion, we’ve provided this simple comparison guide to help you choose which coin is the best investment for your budget.
Table of Gold Britannia Vs Gold Sovereign
| Feature | Gold Sovereign | Gold Britannia |
| Gold Content and Purity | 22-carat gold (91.67% pure) with copper, adding durability and a reddish hue | 24-carat gold (99.99% pure), ideal for investors wanting the most gold in a single coin |
| Size, Weight, and Dimensions | Smaller coin options with weights like 7.32g (0.2354 oz), are often more affordable for incremental investing | Standard 1 oz coin weighs 31.1g, appealing for larger one-time investments |
| Market Demand and Liquidity | High demand among collectors, historical value drives demand | Popular with modern investors due to purity and global recognition, higher liquidity |
| Investment Potential | Appeals to collectors and those interested in British heritage; lower cost per ounce but with potential historical appreciation | Preferred by investors focused on gold content, simplicity in trade, and strong resale value due to purity |
| Risk and Reward | Lower risk with heritage appeal, though 22-carat may not appeal to purists | Offers good liquidity and CGT exemption in the UK; higher purity can mean higher price per ounce |
| Tax Implications | Both are exempt from VAT and Capital Gains Tax (CGT) in the UK | Both are exempt from VAT and CGT in the UK |
| Ease of Storage and Transport | Smaller size is highly portable and easy to store in small containers | Larger, slightly heavier; best stored in tubes or capsules for larger storage solutions |
| Collectibility and Numismatic Value | Historically rich with collector appeal, unique designs, and eras add value | Collectors interested primarily in special editions and high-purity |
| Durability and Handling | Durable 22-carat alloy is scratch-resistant, easy to handle | 24-carat purity makes it softer and more prone to scratches; best handled carefully or stored in protective cases |
History and Background
Gold Sovereigns
The Gold Sovereign has a long history that began in 1489 with King Henry VII, who wanted this coin to show royal power and economic stability. It was first called the “double rose” and had a design that represented the joining of the Houses of York and Lancaster.
In 1817, authorities changed the Sovereign and brought it back as part of a new currency plan after the Napoleonic Wars. This new version showed the famous image of Saint George fighting the dragon, made by Italian engraver Benedetto Pistrucci, which has become a symbol of British history.
The Sovereign has played an important role over the years, especially during the Victorian era under Queen Victoria. It was widely used in trade as the British Empire grew. Regular production of the coin stopped in 1957, but it is still a popular collectible today, representing both historical importance and real value.
Gold Britannia
The Royal Mint introduced Gold Britannia in 1987 to address the increasing demand for gold coins. The coin features Britannia, a symbol of Britain, and initially used 22-carat gold. In 2013, it switched to 24-carat gold. The Royal Mint also makes Silver Britannias and Platinum Britannia.
Its launch marked a new period for gold investing in the UK, attracting both investors looking for a safe asset and collectors who like its design. Over the years, Britannia coins have changed in both appearance and popularity, becoming known as a modern investment option.
Britannia represents British strength and resilience, making it a lasting symbol of national pride. Its development shows both its historical background and its current importance in investing, making it one of Britain’s most famous gold coins alongside the Sovereign.
Gold Britannia vs Sovereign Coins
Gold Content and Purity
Gold Sovereign and Gold Britannia differ significantly in terms of gold content and purity, which can impact their desirability for investors.
The Sovereign contains 22-carat gold, which means it has approximately 91.67% pure gold. The remaining composition consists of other metals, typically copper. This alloy not only enhances its durability but also gives the coin a distinctive reddish hue.
Gold Britannia contains 24-carat gold, which means it is 99.99% pure. This high purity makes the Britannia a better choice for investors who want the most gold possible.
Size, Weight, and Dimensions
Both coins come in various sizes and weights, catering to different investment preferences. Here’s a detailed breakdown of their standard sizes:
| Coin Type | Weight (grams) | Weight (oz) | Diameter (mm) | Thickness (mm) |
| Gold Britannia | 31.1 | 1 | 32.69 | 2.8 |
| Gold Sovereign | 7.32 | 0.2354 | 22.05 | 1.52 |
| Half Sovereign | 3.66 | 0.1177 | 19.3 | 1.02 |
| Quarter Sovereign | 1.83 | 0.0584 | 13.5 | 1 |
| Double Sovereign | 15.98 | 0.511 | 28.4 | 2 |
| Quintuple Sovereign | 39.94 | 1.2807 | 38.61 | 3 |
The Gold Britannia is larger and heavier than the Sovereign. This makes it perfect for investors who want to acquire a significant amount of gold in a single coin.
Market Demand and Liquidity
Both the Gold Sovereign and Gold Britannia are popular in the UK and worldwide, but they attract different types of buyers. Collectors appreciate the Gold Sovereign for its long history. This history can enhance its resale value in the future.
On the other hand, the Gold Britannia is more popular with modern investors because it has higher purity and is larger. This makes it appealing for those looking to maximize their investment returns, especially during uncertain economic times.
Both coins are currently easy to sell. However, there may be slightly more demand for Britannia, as many investors focus on gold content and purity rather than historical value.
Investment Potential
Gold Sovereign: This coin has a history that dates back to Henry VII. It is ideal for investors interested in British heritage and collecting.
The Sovereign is made of 22-carat gold (91.67% purity) and is consistently in demand because of its classic design. It usually costs less per ounce than the Britannia, but its historical value may increase its worth over time.
Gold Britannia: Introduced in 1987, the Britannia is a 24-carat coin with 99.99% purity. This high purity makes it very appealing to modern investors who care about gold purity and how easily they can sell it.
It’s known for its global recognition and comes in various sizes, including the standard 1-ounce coin. Its modern design makes it a simple choice for buying or selling without the extra collectible cost of the Sovereign.
Risk and Reward
Gold Sovereign: Generally seen as a lower risk because of its collectible value and steady demand from heritage investors. However, its 22-carat gold content may not attract those who want pure gold.
Gold Britannia: A good option for investors who want liquidity, but it may be slightly more expensive per ounce due to its higher purity. The Britannia’s 24-carat status and exemption from Capital Gains Tax (CGT) in the UK add to its appeal as a modern investment.
Tax Implications: VAT and Capital Gains
Both the Sovereign and Britannia are legal tender in the UK and are exempt from Capital Gains Tax (CGT), which is beneficial for long-term investors since profits from selling these coins are tax-free. They are also VAT-free when bought as investment gold, which can help their long-term value.
If you’re choosing between the two, think about what matters most to you: if you value historical and collectible appeal, the Sovereign might be better. If you want liquidity and purity, the Britannia could be the right choice.
Ease of Storage and Transport
Gold Sovereign coins are small (about 8 grams) and easy to store in small containers or coin capsules, making them very portable.
Gold Britannia coins weigh 1 oz (31.1 grams) and take up a bit more space, but they can still fit in coin sleeves or stackable tubes, which are good for larger storage like safe deposit boxes.
Both coins can be safely stored in durable packaging, like airtight capsules, to prevent scratches and wear. They also resist corrosion when kept in dry, cool places.
Collectibility and Numismatic Value
Both Gold Sovereigns and Britannias are popular with collectors and investors. Gold Sovereigns are especially valued for their historical versions, which may have unique designs that attract collectors.
Modern Sovereigns and Britannias come in special editions that can be more valuable. Britannia are appreciated for their 24-carat purity, and rare editions or special designs also draw collector interest.
Durability and Handling
Gold Sovereigns are made of 22-carat gold mixed with copper, making them very durable and resistant to scratches. This means they can be handled easily without showing wear. In contrast, 24-carat Britannia coins are softer and more likely to get scratched.
To protect both coins, it’s best to use gloves or keep them in protective cases. For everyday handling, Sovereigns may be more practical, while Britannia should be kept in displays or protective capsules to maintain their beauty.
Investment Strategy: Britannia vs. Sovereign for Long-Term Gains
Both the Gold Sovereign and Britannia coins offer unique strengths for long-term investments, with key differences in purity, size, and flexibility.
Britannia coins are 24-carat (99.99% pure gold) and offer a full ounce of gold, making them highly valuable for those wanting maximum gold in each coin.
Sovereign coins are 22-carat and smaller (about 7.32 grams), allowing for gradual accumulation and easy partial liquidation if needed.
Both coins are exempt from the UK Capital Gains Tax (CGT), making them attractive options for tax-free investments in gold.
Coin Suitability for Different Market Conditions
During market volatility, Britannia, with its higher gold content, may be preferable for securing larger investments, while Sovereigns allow for smaller, steady acquisitions or easier liquidation. This difference makes Britannia suitable for stable, long-term holding, while Sovereigns may be better for those who value gradual growth and flexibility.
Expert Opinions and Buyer Advice
Experts emphasize that combining both coins can give investors the flexibility to adapt to fluctuating markets, ensuring liquidity, ease of sale, and tax efficiency.
Buying in stable markets and holding through fluctuations is often recommended, as both coins hold high liquidity and have global recognition, making them readily tradable.
Final Comparison: Britannia vs. Sovereign – Which is Right for You?
If your goal is high purity and larger one-time investments, Britannia may be the best choice. For those wanting gradual investment options and flexibility, Sovereigns offer advantages. Ultimately, the best option depends on your investment goals and how frequently you may want to sell portions of your holdings.
In conclusion, Britannias and Sovereigns can both serve valuable roles in a diversified portfolio, with their strengths offering flexibility, tax benefits, and long-term growth potential for investors of all types.
FAQs
Are Britannia and Sovereign coins good investments?
Yes, both Gold Britannia and Gold Sovereign coins are considered good investments. The Britannia has higher purity (99.99% gold), which is great for investors focused on gold content. The Sovereign is valued for its historical significance and is popular among collectors.
What’s the difference in purity between the two coins?
The Gold Sovereign is made of 22-carat gold, which is about 91.67% pure. The Gold Britannia is 24-carat gold, with a purity of 99.99%. This means the Britannia has more gold in each coin.
Which is more popular among UK investors?
Both coins are popular but for different reasons. Collectors like the Sovereign for its history, while modern investors often prefer the Britannia for its higher purity and ease of selling.
Are both coins exempt from CGT?
Yes, both Gold Britannia and Gold Sovereign coins are exempt from Capital Gains Tax (CGT) for UK investors. This tax benefit makes them attractive for long-term investment.