☆ How to invest and buy gold in Canada: A beginner’s 2024 guide.

Reading Time: 16 minutes

Consider your preferences: are you inclined towards second-hand bars, generic gold, or perhaps premium bars like PAMP or Scottsdale Mint? Alternatively, you might lean towards generic coins or rounds, or are government-issued bullion options more appealing? Given your Canadian status, 24K gold might suit you well due to fewer tax complications. Maple leaf, buffalos, and britannias emerge as solid choices for liquidity and competitive pricing. Krugerrands boast global circulation, ensuring heightened universality when selling abroad.

2023: Investment gold on the rise.

In 2023, gold demand surged 11% to the highest in over a decade, driven by exceptional investor appetite. Investment demand for gold reached 1,222.6 tonnes, demand for gold bars (802.7 tonnes) and official coins (320.9 tonnes) and 98.9 tonnes for round , rising by 10% year-over-year. Meanwhile, jewellery consumption, one of the biggest components, fell 3% to 2,086 tonnes.

Where to buy physical gold in canada.

The Canadian Mint offers gold at a slight premium over market price, whereas finished coins can be notably expensive. Bullion bars usually include a premium atop market rates—typically around $150 per ounce or $80 to $100 USD per ounce, relative to the current market rate.

One of Canada’s leading precious metal refiners, Express Gold Refining in downtown Toronto, stands out for their services, even offering bullion delivery via armored trucks. For Canadians seeking to buy gold bars or coins, options vary depending on location—major cities like Toronto host several gold and bullion stores. Personally, I’ve found Canadian PMX, situated in the northern part of Toronto, also offers a solid buying experience, both in-person and online. a reliable source for maple leaf purchases, while TD Bank provides reasonable premiums and offers perks like discounts for customers and free bank lockers with premium checking accounts. Additionally, Costco is another unconventional but viable option for purchasing gold directly. Express Gold Refining, located in downtown Toronto along Victoria Street, remains my preferred bullion source due to their competitive fees compared to banks. Bank of Nova Scotia deals in 1 oz gold bars with a minimal commission but faces challenges when selling back to them. Trusted online dealers like Colonialacrecoins.com, silvergoldbull.ca, jmbullion, and thecoinshoppe have proven reliable in the past, with the Royal Canadian Mint maintaining a list of verified dealers for reference. TD also stands as a reliable option for existing customers seeking gold purchases.

  • Border Gold, a reputable company with slightly lower prices, compensates with non-free shipping, averaging out similar to others.
  • Thecoinshoppe, an Ontario-based online company, primarily deals in artistic bullion but offers gold in various forms with free shipping for purchases of an ounce or more. Thecoinshoppe remains a preferred daily check-in spot, reflecting their reliability and quality service.
  • Silver Gold Bull emerges as the largest and most recognized online dealer in Canada, offering a wide selection and occasionally featuring discounted prices, notably the “ape” prices. However, using platforms like pmsforsale might not be advisable for new Canadian buyers in precious metals due to potential discrepancies in pricing, payment methods, and exchange rates. Silver Gold Bull stands out as the largest and most reputable online dealer in Canada. I’ve shared the “ape” prices (it’s a unique term!) which offer some of the best rates for limited items. Alternatively, their main site boasts a vast selection, albeit at slightly higher prices. Plus, orders over $299 qualify for free shipping, making it a straightforward choice. Now, onto a somewhat controversial point—I believe that for new buyers diving into precious metals, particularly in Canada, using pmsforsale might not be the best approach. Canadian sellers are a rarity on that platform, and purchasing from the US often incurs unfavorable costs due to exchange rates and increased shipping expenses. Additionally, the payment methods favored by 95% of users on the platform aren’t compatible with Canadian buyers (no Zelle or Venmo, and international PayPal transfers incur costs). In my opinion, newcomers in the precious metals market are better off purchasing from a trusted online dealer. It’s hassle-free and more reliable.

Purchasing and Storing physical Gold in Canada: the Bank Options.

In Canada, purchasing gold is facilitated by the country’s major banks, including RBC, TD, CIBC, and BMO. Customers can buy gold directly from these banks, either in-person at a branch, online, or through online banking linked to their accounts. However, there are limits on how much gold one can purchase within a 24-hour period, typically around $10,000. Should one wish to buy more than the stipulated limit, they must visit a local branch in person with two pieces of valid identification. Notably, some banks like TD impose lower limits on non-bank customers, capping purchases at $2,999.99 within 24 hours.

Additionally, Canada’s major banks offer storage services for clients’ gold through custodial accounts, free of charge. However, it’s important to note that the gold withdrawn from a bank may not be the exact same gold deposited, as it is stored collectively. To ensure ownership of specific gold, customers can opt for allocated storage, which assigns a separate vault with their name on it. This service incurs a fee, either as a flat annual rate or an annual percentage of the gold’s value.

While there are limits on purchasing gold, there’s no restriction on the total amount one can own, as physical gold investment is not monitored by the government. Apart from banks, individuals can buy gold from trusted dealers, either online or in-person. Though pure gold bullion is exempt from taxes, buyers are responsible for delivery, transportation, or insurance costs.

The major Canadian banks where gold can be purchased include:

Purchases can be made online or through online banking, with most banks allowing up to $10,000 worth of gold within 24 hours. However, TD has a lower limit of $2,999.99 within the same timeframe. Transactions exceeding these limits require in-person purchases at the branch with two valid pieces of ID.

After purchasing gold, customers have the option to store it at the bank or personally. Bank storage is provided free of charge but entails collective storage. Separate storage incurs an additional fee, which could be a flat annual rate or a percentage of the gold’s value. Regardless of storage location, it’s advisable to insure the gold, with banks typically offering insurance for the precious metals they sell. Customers should verify their bank’s insurance policy directly to determine if it’s included or requires an additional fee.

Scotiabank closed its metals business.

The decision to close the metals business was made after a strategic review and downsizing efforts that began in 2018. The closure of this division was confirmed by sources familiar with the matter and was communicated to employees during a conference call. The bank decided to wind down existing activities by around the beginning of 2021 and would not take on new business in this sector. This move marked the end of Scotiabank’s involvement in the metals trading industry, which

Banks like HSBC and Leader Bank sell gold coins, but they would not usually publish information about it on their websites or advertise it openly for security reasons. Therefore, it is best to contact your bank directly and ask if they sell gold coins. However, it is important to note that when you buy gold coins from banks, they may charge 7-10% higher prices than the market rate.

TD Canada Trust, a prominent player in the Canadian banking landscape, has stepped into the precious metals market by offering an array of gold and silver coins and bars for purchase. “Metalhead stacker” is quick to point out that this avenue offers an alternative to the traditional means of acquiring these valuable commodities.

The bank’s website acts as the digital gateway for precious metal enthusiasts to explore their options. TD Canada Trust does not charge shipping fees for orders exceeding $100. This could potentially make the bank’s platform an attractive option for those looking to build their precious metals portfolios without incurring additional costs.

Conclusion

While it is technically possible to buy gold coins from some banks, it is not very common. Banks usually avoid selling precious metals because of their price fluctuations, and even when they do sell gold or silver, their inventories typically don’t measure up to the size and variety of inventory available from precious metals companies. Additionally, when you buy gold coins from banks, they may charge 7-10% higher prices than the market rates. Therefore, it may be more convenient to purchase gold coins from reputable precious metals companies like JM Bullion, APMEX, or another authorized dealer.

Gold Coins and bars for purchase on Costco.ca.

Costco Canada is currently offering a limited edition 2023 Canadian Maple Leaf 1 oz Gold Coin, as well as Royal Canadian Mint (RCM) gold bars and ingots. These offerings are in high demand and tend to sell out rapidly. Unlike other prominent precious metals dealers, Costco is continuously expanding its selection of gold products, making it a noteworthy option for gold investors.

For those holding an Executive Membership, Costco offers a 2% cashback reward, which can be combined with an additional 2% cashback if using a Costco credit card, resulting in a total of 4% cashback. This can sometimes bring the purchase price below the spot price of gold, which is particularly advantageous. However, it’s important to remember that the annual membership fee of $60 for standard members or $120 for executive members applies.

Unfortunately, Costco Canada does not ship these gold items to U.S. addresses. Therefore, U.S. buyers must arrange for delivery to a Canadian address and find a trusted individual in Canada to forward the shipment.

Reviewers praise the quality, value, and convenience of purchasing gold from Costco, with many expressing their intention to continue buying similar products in the future.

Please be aware of the following Terms & Conditions:

  1. This item is non-returnable and non-refundable.
  2. Gold bars are now available for purchase at Costco in Canada, but financial experts caution that this investment may offer limited returns, unless you are considering it for emergency purposes.
  3. The listed price for this item is firm and not eligible for price adjustments or promotional discounts.
  4. This product is not available for purchase in Manitoba.
  5. Each membership is limited to one transaction every 7 days, with a maximum of 2 units per transaction.

In essence, anyone who can sell gold stands to benefit from the concerns over inflation. The primary group harboring such concerns consists of individuals who were adults during the late ’70s and early ’80s, when they witnessed the consequences of interest rates soaring to 18-20 percent for mortgages.

Now in their 60s and 70s, they fear the prospect of their financial security being eroded with no time left to rebuild it. Gold is predominantly sought after due to these anxieties rather than its historical performance, which has remained relatively stagnant for three years. Its price is essentially the same as it was in the early months of the pandemic.

These customers had an exceptional experience shopping for gold coins at Costco. The recurring theme throughout the reviews is the excellent quality and value of the products. Mike008, who shopped a week ago, lauds Costco for a great shopping experience and punctual delivery. They express their intention to make more purchases in the future. ABHI42 received their gold coin in just two days and expresses their satisfaction with the product’s quality and value. Coinsplus1 finds the gold coin gorgeous and appreciates Costco for offering great value and free UPS shipping. Sami loves the good value of the gold coins and appreciates the competitive pricing at Costco. They express interest in having more variety, including other metals like silver, and mention their confidence in shopping for gold at Costco. Tameraq, in their review, highlights the amazing value of purchasing gold at Costco. They mention that the 1 oz maple leaf coin was significantly cheaper compared to TD precious metals’ price and was only slightly above the spot price, which they find remarkable.

For more details, visit the Costco Canada product page.

Buy bullion in the states and have it shipped to a U.S. mailbox.

If you are based in Canada but often cross over to Detroit or Buffalo/Niagara Falls, buying bullion in the states and have it shipped to a U.S. mailbox. finding it the most convenient way to acquire metals in Canada. SD Bullion has BU coins at a reasonable price, but there’s no option to inspect them before making a significant purchase. Considering PMs for sale on Reddit as an alternative. Open to suggestions I may not have considered for cost-effective stacking in Canada since there are no local coin shops nearby, and the Royal Canadian Mint website is consistently sold out.

There are a couple of websites in Canada worth exploring.

like Au Bullion and SilverBull. SD Bullion remains a reliable option; I recently acquired two pre-33 $5 coins from them, which turned out to be exactly what I wanted. However, there’s still an element of chance involved.
For larger quantities, Royalbull could be a good choice due to their reasonable $25 shipping fee and extensive selection at competitive prices. Alternatively, if you’re looking for smaller quantities, consider Sprott Money. These options tend to be cheaper than traditional banks or local coin shops.
Also, keep in mind that in Canada, only gold with a purity of .995 or higher is considered “investment grade,” so be aware of potential taxes. Lastly, I managed to snag my only St. Gaudens (a 1927, MS64) at a coin show for a great price due to its common date and a copper spot above the date.

Precious metals have a very specific definition under Canadian law.

If the metal is in certain forms and at a certain purity level, no GST or HST tax is due. However, if the metal does not meet these specifications, GST or HST may apply. Pure gold and silver are not subject to applicable taxes. Bullion and collectible coins that meet Canadian purity requirements—99.5% for gold and platinum, and 99.9% for silver—are exempt from all GST, PST, HST, and QST in Canada. The definition of “bullion” under Canadian tax law is clear: 99.5% or higher purity for gold and platinum, and 99.9% for silver. The format of the item, whether it is jewelry, a coin, or a bar, is irrelevant.

However, the situation becomes more complex because the Royal Canadian Mint also sells collectible coins that meet these criteria and are thus tax-exempt. Despite these exemptions, bullion and coins are subject to capital gains tax across Canada, with personal-use property exemptions. According to these rules, coins with a resale value and gain of $1,000 or less are exempt from capital gains charges.

22k gold coins are taxed but 24k Gold coins are not taxed.

In Canada, gold bullion is subject to capital gains tax at the federal level. The tax rate is 50% of the individual’s marginal tax rate and can range from 0% to 33%. Additionally, some provinces may impose their own taxes on gold bullion. For example, in Ontario, gold bullion is subject to a provincial-level sales tax of 13%. To be exempt from GST/HST, these precious metals must meet certain purity standards. Specifically, bars, ingots, coins, or wafers made of gold, silver, or platinum must have a minimum purity of 99.50% for gold and platinum, or 99.9% for silver. However, palladium products are subject to HST/GST.

In Canada, items with purity less than 99.5% are subject to sales tax, which includes jewelry. This is primarily to prevent individuals from circumventing the tax. Many investment coins, such as the American Eagle coin, are affected by this taxation rule. For instance, the Gold Maple Leaf, one of the world’s most popular gold bullion coins, is minted in various weights and face values, ranging from a 1-ounce version with a $50 legal tender value to a 1/20 ounce version with a $1 face value. Newer versions have enhanced security features like micro-engraved mint marks. Aaron Buys Gold Ltd is an official Bullion DNA dealer for the Royal Canadian Mint, offering these coins to investors.

opting for 1 oz gold maples

government coins tend to appreciate in value given proper care, holding a premium. While government bullion generally costs more than generic 1 oz coins from private mints, it holds the advantage of tracking spot price along with the potential for numismatic gains. Highlighting the current disparity in spread, suggesting that opting for 1 oz gold maples might be a wiser choice. It’s noted that these maples serve as the sovereign gold coin of Canada, addressing concerns about serialization and authenticity due to robust security features, which could simplify future selling processes. In a similar vein, the preference for specific coins based on location—like eagles in the US and maple leaves in Canada—should be highlightedes. Caution is advised regarding the pricing of coins, urging vigilance against inflated prices based on collector value rather than their intrinsic bullion worth. This emphasis stems from an assumption that the individual seeking advice is focused on bullion value rather than collectibility.

In the United States, there is a notable similarity in the pricing of 22k and 24k gold coins. The American Gold Buffalo coin typically carries higher premiums, while the American Gold Eagle may yield a greater premium when sold to a local dealership. Differences in purity are mainly taken into account when buying gold coins outside the U.S. Tax implications for precious metal bullion and coins are consistent within the U.S., but they may differ from country to country.

For example, in Canada, gold coins with a purity rating below 99.5% are considered taxable “scrap gold,” while pure 24k gold is not subject to taxation. Therefore, the 22k American Gold Eagle, popular in the United States, may not be as favored in other countries. It’s important to note that Palladium products are not exempt from HST/GST in Canada.

In Ontario, if the bullion or coin products do not meet the specified purity criteria, a 13% HST is applied. Moreover, capital gains tax is applicable to bullion and coins throughout Canada, including Ontario. However, there are exemptions for personal-use property. Coins with a resale value and gain of $1000 or less are exempt from capital gains tax according to Listed Personal Property (LPP) rules.

What is your reason for investing in gold? My personal point of view.


For me, investing in gold goes beyond financial strategy; it’s deeply personal. It’s about safeguarding my hard-earned wealth, ensuring it retains its value even in tumultuous times. Reflecting on the ’90s, when gold was priced at $250/oz, I remember the significance it held, not just as an investment, but as a symbol of stability and security.

Gold is real money, everything else is credit

JP Morgan

My reason for investing in gold would be to diversify my investment portfolio, protect against inflation, benefit from its stability during economic and geopolitical turmoil, and have a tangible asset that can be easily liquidated when needed. Gold has historically maintained its value, acted as a hedge against inflation, and shown a negative correlation with other asset classes, making it a valuable addition to an investment portfolio

I view gold not just as a means of making money, but as a form of insurance against the erosion of fiat currencies. It represents tangible wealth, something I can rely on when the value of traditional currencies fluctuates. Unlike investments tied to the performance of markets, gold stands as a steadfast asset, unaffected by the uncertainties of economic cycles.

ve got me here what are you going to do with me ?
Although that saying did not relate to gold coins, (It was a bit naughty) the same saying is true of gold coins and bullion. (no – bouillion is a French soup and it does not keep well after two days !) Seriously though once you have purchased gold coins or bars you have a fairly immediate problem. That is How and where are you going to store coins.
Storing Gold coins is the main problem for most collectors…

The answer is not simple – a few gold coins can be kept in a 10 coin sovereign case which is padded and protects your coins well.
These are available here on ebay. Or at Amazon. These fit easily into any drawer or bureau.

Smaller Collections, 1 to 20 gold coins.

Single gold coins usually come in protective covers tren in tube then in a small box and are easily hidden either in your home or office (under the floorboards or under the loft insulation in a box or plastic bag seems to be a favorite for many people.
I have heard of some people who prefer hiding a few coins under a carpet – just use your imagination to find somewhere in your own home that is easily overlooked but not somewhere that can be found by treading on it accidentally.

Larger collection, 20 to 100 gold coins.

The main problem seems to be when an investor has a quantity of Gold Sovereigns or Gold Eagles to store safely.
Home insurance is usually limited to a collection of around $1500 to $2000 but check with your insurer to see how much you are covered for on your household policy.
If you understate the amount, you have then the insurance company will usually not pay out at all. Or at a lower rate.
Single valuable coins should be listed separately on your insurance policy.

If you have a safe at home then please use it (and don’t leave the combination lying around for a burglar to find!)

Store at home with Safe Box for gold.

Home safes vary in quality and more expensive ones may be a wise investment. Do not bother with safes disguised as food containers – burglars know all about these.
Wall mounted safes hidden behind pictures are good as these are built into the actual fabric of the building.
Underfloor safes work well if you have easy access. In Australia many stores have larger safes built into their floor with an easy access to contents on a time lock basis.

Best way to bury gold.

The next step up is to bury your gold. – this is not a joke!
Burying gold has long been the favorite storage method of most politicians and despots since time immemorial.
The Nazis for instance hid huge amounts of gold in caves in Austria (a bit extreme admittedly but certainly a safe place!)
War causes huge problems with security for your gold coins.
Plan for easy access for you and helpful people at the storage facility.

It is a fact that for thousands of years merchants and collectors have buried gold coins for two reasons.

  • gold is difficult to damage because it is a noble metal (only very strong acids or mercury will damage gold).
  • Burial is a fairly secure way to keep that little nest-egg secure (although it is unlikely that you would store gold in proximity to such substances).

There are three disadvantages though one is that you forget where you buried your gold, the second is that something might happen to you an accident or a bolt of lightning or another unexpected and unfortunate happening. The third possibility is that your life partner may dig it up and move away with your coins. (it has been known to happen)

Anyway, I strongly suggest that you write out the whereabouts of your hoard and keep it either with your will or another safe place for your wife/husband/partner to find later preferably after your death. Just this week for instance, a pot containing 10,000 coins was discovered by a treasure hunter in Shrewsbury England.
I expect the original owner in Roman times was seriously expecting to retrieve them later.

Banks And Secure Storage.

A larger amount of gold is frankly more secure in the vaults of a Bank, Safety Deposit or Bullion Dealer.
The amounts these institutions charge varies from $25 a year upwards depending on the conditions of the company.
You must insure your coins against theft – criminals DO target these institutions.

(Butch Cassidy said it all when asked why do you rob banks he replied –it’s where they keep the money!)

Sadly banks, safe deposits and bullion dealers do sometime go bust. It is ESSENTIAL that if you place a large quantity of gold coins or bullion you must have an ALLOCATED storage area.
Allocated storage areas differ from other storage areas in the premises where if the bank/deposit etc goes bust the gold is not then treated as an asset of the bank/deposit.
This is called a non-fungible allocated area.

You should investigate the finances of any Bank or safe deposit before trusting them with your gold. It has been known for fake safe deposit companies to set up and decamp with the contents!

Even very large Banks have recently gone out of business.

If you visit the vaults of any major bullion dealer/mint you will see shelves and shelves of deposits from private individuals, companies and even countries with notices in front of each box stating the ownership of these allocated areas.
Private or Government Mints also offer allocated gold coin storage as do precious metal trading centres worldwide. ALWAYS take out insurance as well to get a bet and braces form of security for your wealth.
Although local banks may also offer similar storage facilities, banks in Lichtenstein and Switzerland have higher security and greater privacy laws.
The problem of storing your gold in these and offshore banks is ease of access.

The Perth Mint in Australia is one of the few safe storage areas specifically for gold coins

Gold is surprisingly heavy.

Do not store gold in a box weighing more than you can physically carry. If you need access in a hurry, you should at least be able to carry it!

As a rough guide an area the size of a brick would house 2,500 gold sovereigns. This would hold around 2.4 million dollars (at today’s rate which will undoubtedly have changed by the time you read this article.)

Spread the love

Leave a Reply

Your email address will not be published. Required fields are marked *


Posted

in

by

Tags:

© 2024. Made with Twentig.