Gold Bars vs Gold Jewellery: The Honest Comparison
Bars win on price, resale and tax. Jewellery wins on the fact that you can actually wear it. Here is the full comparison from a jeweller who does not sell bullion.
If your goal is to own gold as an asset, buy bars or coins. They cost less over the metal value, sell back closer to it, and in Canada they are exempt from GST and HST at 99.5 percent purity while jewellery is taxed in full. We are a jewellery shop, and that is still the correct answer.
Key takeaways
- Bullion is priced at metal value plus a small premium. Jewellery is priced at metal value plus design, labour and retail margin.
- Solid gold jewellery still has a floor: the value of the gold in it. Plated and filled jewellery does not.
- Canadian law splits them at 99.5 percent purity, under the Excise Tax Act. Bullion above that line is exempt from GST and HST. Jewellery is not.
- Jewellery cannot go in an RRSP or TFSA. Qualifying bullion can.
- Buy jewellery to wear it. If you want it to also hold value, buy solid, heavy, plain and hallmarked.
What Vanhess does and does not do
Vanhess is a jewellery shop in Coquitlam, British Columbia. We sell solid gold jewellery. We do not sell bullion, bars, coins or wafers, we do not buy or broker investments, and we are not financial advisors, tax advisors or a bullion dealer. Everything on this page is general information to help you understand how gold is priced and valued. It is not financial, investment or tax advice. Speak to a licensed advisor or an accountant before making a decision about your money.
Where the money goes
The single biggest difference is what sits between the metal price and the price on the tag. With a bullion bar, that gap covers refining, stamping, packaging, distribution and a dealer margin. It is real work, but it is a thin layer.
With jewellery, the gap covers alloying the metal to the right karat and colour, drawing wire or casting components, assembly, soldering, setting any stones, filing, polishing, plating where applicable, quality control, photography, shipping, insurance, shop rent and staff. That is a great deal of skilled work, and it is why a chain costs what it costs. It is also why none of it comes back when the piece is sold for its metal.
Efficient at storing value
Gold bars and coins
- Small premium over the metal price.
- Sells back near the metal price to any dealer.
- Exempt from GST and HST at 99.5 percent purity or above.
- Eligible for an RRSP or TFSA if the CRA conditions are met.
- Must be stored and insured, and gives you nothing to enjoy.
Efficient at being worn
Solid gold jewellery
- Large premium over the metal price, covering design and labour.
- Resale usually references scrap value, not what you paid.
- Charged full sales tax as a retail good.
- Never eligible for a registered plan.
- Worn daily, gifted, and handed down, which no bar can do.
The full comparison
| Gold bar or bullion coin | Solid gold jewellery | |
|---|---|---|
| Typical purity | 99.5% to 99.999% | 37.5% to 91.7%, marked 9K to 22K |
| What you pay above metal | Refining, distribution, dealer margin | Design, labour, finishing, retail margin |
| Resale reference point | The metal price | Scrap value of the metal |
| Ease of resale | Any bullion dealer, quickly | Jeweller, pawnbroker or refiner, with more variation |
| GST and HST in Canada | Exempt at 99.5% or higher | Charged in full |
| RRSP or TFSA eligible | Yes, if conditions met | No |
| CRA gains category | Ordinary capital property | Listed personal property |
| Storage | Safe or vault required | Worn, or a jewellery box |
| Insurance | Usually needs specific cover | Usually needs scheduling on a policy |
| Can you enjoy it | No | Yes, every day |
The case for jewellery, made honestly
Nobody buys a gold bar because it makes them happy to look at. The argument for jewellery is not that it is a better investment, because it is not. The argument is that it does two jobs at once: it is a thing you wear and enjoy for decades, and underneath that it holds a metal floor that a silk scarf or a leather bag does not.
Compare it with the alternative use of the money, which for most people is not a gold bar. It is a handbag, a watch, a holiday. Against those, solid gold jewellery holds up extremely well, because when you are finished with it the metal is still there.
The part that does not show up in any calculation
Gold jewellery gets inherited. A grandmother's chain carries a value to the family that has nothing to do with its weight in grams, and that is a real thing even though no spreadsheet captures it.
This cuts both ways. Sentiment is also why people hold on to pieces they will never wear, and why estates argue. Being clear-eyed about which pieces you keep for love and which you keep for metal makes both decisions easier.
If you want jewellery that holds value
Four things decide the metal floor of a piece, and you can check all of them before you buy.
| Check | What to look for | Why it matters |
|---|---|---|
| Solid, not plated | The word solid, and a karat mark | Plated and filled pieces have no meaningful recoverable gold |
| Karat | 14K or 18K stamped inside | Tells you the proportion of gold in the alloy |
| Weight | Ask for the gram weight | Gold is sold by mass, so grams are the value |
| Simplicity | Plain forms over intricate ones | Less labour in the price means more of it is metal |
Be careful
A piece with no karat mark at all is a problem. In Canada the Precious Metals Marking Act governs how precious metal articles may be marked, and the Precious Metals Marking Regulations set 9 karats as the minimum quality that may carry a karat mark. An unmarked piece may still be solid gold, but you will have to have it tested to prove it, and that costs you at resale.
Frequently Asked Questions
Is it better to buy gold bars or gold jewellery?
For investment purposes, gold bars. They carry a much smaller premium over the metal price, sell back closer to that price, and in Canada bullion at 99.5 percent purity or higher is exempt from GST and HST while jewellery is taxed in full. Buy jewellery because you want to wear it, and choose solid, hallmarked pieces so it also holds a metal floor.
How much of a gold jewellery price is the actual gold?
It varies enormously. On a heavy plain chain the metal can be most of the price. On a light, intricate piece with stone setting, the metal can be a small fraction, because you are mostly paying for hours of skilled work. Ask for the gram weight and the karat and you can work out the metal share yourself.
Will gold jewellery hold its value?
Solid gold jewellery holds a floor equal to the value of the gold in it, less a refining margin. It generally will not hold the retail price you paid, because the design and labour portion is not recoverable. Plated and gold filled jewellery holds essentially no metal value at all.
Can I buy gold bars from Vanhess?
No. Vanhess sells solid gold jewellery from our shop in Coquitlam, British Columbia. We are not a bullion dealer and we do not sell bars, coins, ingots or wafers. If you want bullion, buy it from an established bullion dealer or the Royal Canadian Mint.
Read next
Solid gold, plainly made
Pieces where the metal is the largest share of what you pay.
14KClassic Bangle
A plain solid bangle: most of what you pay for is metal you can weigh.
$800.00
14KByzantine Emperor Flat Chain
A heavy flat link chain, the classic hold-its-weight piece.
$900.00
14KClassic Stacking Band
A plain stacking band with no stones to complicate a resale.
$380.00Vanhess sells gold jewellery. We do not sell bullion, bars or coins, and nothing here is financial or tax advice.