VAT on Second Hand Gold

The definition of second hand was indeed amended as follows;

 

The definition of second-hand goods specifically excludes gold coins that are subject to VAT at the zero rate. With effect from 1 April 2015 the definition was further limited to exclude gold and goods containing gold. The effect is that dealers in second-hand gold, gold jewellery or other products containing gold will no longer be entitled to deduct notional input tax when purchasing these goods from non-vendors. The amendment is part of a package of measures introduced to prevent the invalid deduction of input tax. It is also aimed at addressing certain compliance issues which are prevalent in this industry, such as the issuing of fraudulent tax invoices and the misrepresentation of transactions involving illegally mined gold as being purchases of second-hand jewellery.

 

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