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I have looked around for this for ages and for obvious reasons, would be a very efficient means of paying bills without HMRC taking a cut (as long as I can't be attacked for Tax evasion).

I have seen the one case in the U.S. where a fella paid his invoices in Gold and it turned out bad for him. But the sums involved were huge. Mine are on a far lower scale, and probably would be below the radar.

What does it actually mean for a a coin to be legal tender, I see that many of the UK bullion coins are valued with a face value that no way represent their intrinsic value. Does this mean that I can create contracts of the face value, and actually pay in intrinsic value.

For example, a quarter Oz Britannia has a face value of £25 but is actually worth around £300.

My contractual agreement will be in £25, but I pay in 1/4 oz gold bullion. Is this legal?

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The "face value" of the gold bullion coins is pretty meaningless, unless of course, gold collapses to below $100 or so per oz.

Any deal where you specify, say $100 face value gold bullion, will be considered an evasion of taxes or whatever it is you're trying to avoid. This concept has been around for decades. In the US, our coins (ten cent pieces or higher) were high silver content until 1964. In the 70's and 80's these scams surfaced where people were trying to claim transactions at 'face value' yet the bullion value transacted was far higher. Your IRS-equivalent won't ignore these transactions. Nice try.

  • Yes I know all about your countries silver, I am currently stacking old american silver coins at a great rate of knots. Shame its not sterling silver mind ;), but hey better than us Brits coping out after 1920 to 400 silver. – WeNeedAnswers Jun 7 '12 at 0:03
  • Maybe we should all move to Utah. You know it makes sense :) – WeNeedAnswers Jun 7 '12 at 0:04
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    I make two assumptions - your tax office is as astute and aggressive as ours, and face value aside, this will be treated same as bartering. I can't pay my dentist with a painting from my collection to allow him to avoid income tax. – JoeTaxpayer Jun 7 '12 at 2:06
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    barter and trade is perfectly legal, but you pay taxes based on the fair market value of the traded items. I.e.: if you trade a gold bullion - you pay taxes based on what its worth, not what's the number imprinted on it, be with a $ sign, or £ or whatever. And VAT is not sales tax. – littleadv Jun 7 '12 at 2:31
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    calling a quid pro quo exchange as you suggest is illegal. Bartering is legal, but taxed. – JoeTaxpayer Jun 7 '12 at 2:54

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