Gold: a precious material synonymous with wealth, but it also represents a considerable investment. With the price of gold constantly rising, some people are moving towards the sale of jewellery they have accumulated over the years. The idea can be profitable, provided they know a certain number of points about gold and its transactions. Here are 4 essential elements that you must know before you start selling gold.
1-Historical overview on the value of gold
What is important to know is that gold has always been regarded as a standard material that constitutes the currency of every nation in the world. Until 1971, the gold dollar was the currency of exchange in international transactions. Now, governments and individuals alike are trying to convert their money into gold. This is a safe investment that remains profitable even in times of economic crisis. Throughout history, money has always had its ups and downs, but there are more downs than ups. Let’s take the example of Germany. In the run-up to the Second World War, you had to give a whole wheelbarrow of money to buy something as simple and necessary as bread. This was concrete proof that money was no longer important. If the Germanic episode seems so frightening, the chances are now very low that such a catastrophic scenario could happen again. But the most fortunate people continue to feed their gold stock and bet on this precious metal on the stock exchange: a growing interest that has given gold a spectacular rise in price!
2-The cooling-off period and right of withdrawal
If you are not yet familiar with the process of buying and selling gold, there is a set of laws governing this highly controversial area. This means that it’s easy, when you ignore these credos, to get trapped and lose instead of winning. Every person who wants to sell their gold must know their rights, as in any other industry. Among these rights is the right to “retraction”. According to the Hamon law applied since March 2014, you have 24 hours to cancel the sale. To benefit from this advantage, you do not need to justify your retraction. Moreover, there is no penalty. All you have to do is let the seller know that you want to keep your gold, whether it is a specialized counter, a jewelry store or a store specialized in gold buy-back: establishments which, in recent years, have been flourishing on every street corner. Beware! Some establishments offer to pay you immediately without respecting the withdrawal period. This approach is often applied to people who are unaware of their rights, even though this cooling-off period was designed to protect you and guarantee you the best conditions of sale. The general manager of the Comptoir national de l’or even talks about a possible extension of the deadline to 48 hours instead of the 24 hours applied since 2014. Please note: The Hamon law does not concern gold bars and gold coins called “investment gold” but only jewellery.
3-The resale of gold: a tax issue
The taxation system, applied to the sale of gold, offers different tax scales. Let’s establish from the outset that when you sell your jewellery, you don’t have to pay tax. However, for precious metals, you will have to pay 6.5% of the sale price. But this only applies when the value of the gold to be sold exceeds 5,000 euros. A tax of 10.5% is imposed when someone wants to sell Napoleon-style gold or whole bars. In this case, how can the tax rate be limited? By opting for the tax on capital gains alone. With this system, you initially pay 34.5% while benefiting from a 5% reduction from the 3rd year onwards. In the end, after 22 years, you are totally exempt from taxes. However, these tax advantages are only possible when you have a purchase invoice with the date and price. Unfortunately, very few French people can benefit from them!
4-Compare prices to sell for more money
As for all products with little regulation in terms of prices, selling to the first shop or website is a wrong approach. It is necessary to consult several of them, negotiate the price and then make a sale. It can be said that today, there is no official gold price. Each buyer applies his own rates and tries to win as many customers and gold as possible. In order to regulate this sector on the fringes of canonical pricing systems, traders are required to choose their prices and then pay the tax themselves. This avoids the old scheme whereby it was up to the consumer to pay the tax. Such a process allows buyers to make gross offers, thereby crushing their competitors. So, to always come out ahead and get a great resale price, don’t settle for just one establishment. Contact several of them before formalizing the sale. Here you can use your right of retraction and avoid any bad transaction!