Gold investment is enjoying a resurgence in the UK as rising capital gains tax rates and record-high prices drive a wave of physical coin buying. Yet many wealth managers continue to point investors toward exchange traded funds as a simpler and more efficient route to gold exposure.

The Royal Mint reported that online bullion transactions hit record highs in the first quarter of the 2025–26 financial year, with bullion coin sales up 115 percent compared with the same period in 2024. The World Gold Council also noted a 17 percent increase in UK bar and coin demand year-on-year.

Solomon Global, a UK-based seller of physical gold bars and coins, said inquiries for its products rose by 72 percent in the first half of this year compared with the final six months of 2024. In a survey of 14,000 customers, 42 percent cited tax considerations as their top motivation for buying gold coins, with 26 percent naming wealth protection.

Bullion coins minted by the Royal Mint, including gold, silver, and platinum, are exempt from capital gains tax for UK residents as they qualify as legal tender. Other coins and all bullion bars remain subject to CGT.

Louise Street, senior markets analyst at the World Gold Council, said the tax status of Royal Mint coins has “added to the attractiveness of gold” in recent months. She added that changes to CGT announced in last year’s Autumn Budget have been a significant factor in the surge in physical gold purchases.

Gold prices have soared this year, reaching around 3,350 US dollars per troy ounce on Friday, driven by geopolitical uncertainty, trade concerns, and inflation worries.

However, while physical gold offers tax advantages, many professionals still view ETFs as a more practical investment. Exchange traded funds that hold physical gold provide instant access to the metal’s price movements without the challenges of storage, insurance, or illiquidity.

“It is the quickest and most efficient way to get exposure to gold,” said Rob Burgeman, wealth manager at RBC Brewin Dolphin. “An ETF can be sold at short notice, even during times of market stress.”

Oliver Jones, head of asset allocation at Rathbones, echoed the sentiment. “Gold coins are exempt from CGT, but the additional costs of buying, storing, and insuring them can erode returns. With an ETF, you avoid those overheads while keeping flexibility.”

For UK investors weighing the tax benefits of physical coins against the cost and convenience of ETFs, the recent gold rush highlights a broader question: whether the best way to hold gold is in hand - or in a fund.