Precious metals and Goldback glossary

The words that come up when you buy, store or sell gold, silver and Goldbacks, explained in plain English. Each entry links to the guide that goes further.

A

Allocated storage: Storage in which specific, identified bars or coins are held in your name and kept apart from the provider’s own assets. Compare unallocated storage.Home or vault?
Alpha (α): The first production run of a Goldback design, shown by a small α beside the mintage date. The serial number does not indicate Alpha status, whatever a listing says.Alpha Goldbacks explained
Assay: A test that measures how much precious metal an item contains. Bars from recognised refiners usually come with an assay card or certificate, which makes them easier to resell.Buying gold bars
Assay office: In the UK, an independent office that tests articles made of precious metal and applies the hallmark. There are four: London, Birmingham, Sheffield and Edinburgh.
Aurum: Latin for gold, and the source of its chemical symbol, Au. It is also the name Valaurum gives its gold-foil products, which is why Goldbacks are often listed as Aurum gold foil notes.How Goldbacks are made

B

Bar: A rectangular piece of bullion. Cast bars are poured into moulds; minted bars are cut from rolled metal and struck, which gives a sharper finish and usually a higher premium.Buying gold bars
Britannia: The Royal Mint’s bullion coin. Gold Britannias have been struck in 999.9 fine gold since 2013 and silver Britannias in 999 fine silver. Both are sterling legal tender, so gains on them are exempt from Capital Gains Tax.Britannia vs Sovereign
Britannia silver: A hallmarking standard of 958 parts per thousand, purer than sterling silver. It is a different thing from the silver Britannia coin.
Bullion: Precious metal valued mainly for its metal content, in bars, coins or rounds, and bought and sold close to the metal price.Gold investment in the UK
Buy-back price: What a dealer pays you for metal. It sits below the dealer’s selling price, and the difference is the spread.What dealers pay

C

Capital Gains Tax (CGT): UK tax on the gain when you sell or otherwise dispose of an asset. HMRC exempts sterling currency, which covers Sovereigns minted from 1837 and Britannias. Bars and non-sterling coins are chargeable. Allowances and rates change, so check GOV.UK for current figures.Gold investment in the UK
Carat: A measure of gold purity in 24ths. 24-carat is pure gold; 22-carat, the standard of the Sovereign, is 916.7 parts per thousand. Not to be confused with the carat used to weigh gemstones.
Collector premium: The part of a price that reflects rarity, condition or demand rather than metal content. It can rise or fall and is never guaranteed.Goldback premiums explained

D

Denomination (Goldback): The number on a Goldback, which measures its gold: a 1 holds 1/1000 of a troy ounce, a 5 holds 1/200, a 50 holds 1/20. It is not a price in pounds or dollars.Goldback denominations

E

Exchange rate (Goldback): A daily rate that Goldback, Inc. publishes for each Goldback unit. It sits above the value of the gold, and it is a reference for voluntary exchange rather than an offer to buy notes back.How the rate works

F

Face value: The nominal currency value on a coin. For bullion coins it is far below the value of the metal they contain.
Fine weight: The weight of pure metal in an item, as opposed to its gross weight. A Sovereign weighs about 7.98 g but contains about 7.32 g of fine gold.What is my gold worth?
Fineness: Purity expressed in parts per thousand, such as 999.9 for fine gold, 916.7 for 22-carat gold or 925 for sterling silver.
Fractional gold: Gold in pieces smaller than one ounce, such as fractional coins, small bars and Goldbacks. Small pieces usually carry a higher premium per gram.Goldbacks vs fractional gold

G

Goldback: A privately issued note holding a measured quantity of 24-carat gold, vacuum-deposited onto polymer and sealed in. Goldbacks are legal to own in the UK but are not legal tender.What are Goldbacks? · The Goldback guide
Goldback Safe: Goldback’s free online archive of its series, with artwork and authentication details. It is the reference to check a note against.How to tell if a Goldback is genuine
Grading: Independent assessment of a coin’s or note’s condition, often with the item sealed in a labelled holder. Note grading uses a scale on which 70 is the top grade. British dealers also use descriptive grades such as FDC, UNC and EF.British coin grading
Gross weight: The total weight of an item, including any alloy. Compare fine weight.

H

Hallmark: In the UK, the marks an assay office strikes on an article to show it has been tested, its fineness and who submitted it.

I

Investment gold: HMRC’s VAT category for gold that is exempt from VAT: bars and wafers of at least 995 fineness in weights accepted by the bullion markets, and gold coins that meet HMRC’s purity, date, legal-tender and price tests.VAT and CGT explained

K

Krugerrand: South Africa’s 22-carat gold bullion coin. It is currency but not sterling, so gains on it are chargeable to UK Capital Gains Tax, unlike a Sovereign or a Britannia.Selling gold coins

L

LBMA: The London Bullion Market Association. It sets the Good Delivery standards for the large bars traded in the London market and owns the LBMA Gold Price, a benchmark set twice each business day.
Legal tender: A narrow legal term about settling debts, not a rule that shops must accept something. Coins that are legal tender are treated as currency for tax purposes. Goldbacks are not UK legal tender.Are Goldbacks legal in the UK?
Limited Early Release (LER): A special Goldback, usually a 3, issued alongside a state series launch and used mainly to reward people who sign up new merchants.Limited Early Releases explained

M

Melt value: What the metal in an item is worth at the current spot price, ignoring any premium.How much is a Goldback worth?
Milk spots: White marks that can appear on silver coins. The Royal Mint links them to the annealing process before striking; they do not change the silver content, and on plain bullion they rarely affect the price.Selling silver
Mintage: The number of coins or notes produced for an issue. A published mintage is a ceiling on how many exist, not a count of how many survive.

N

Numismatic value: Value as a collectable, beyond the metal: rarity, condition, history and demand.

O

Obverse and reverse: The front and back of a coin or note. On UK coins the monarch’s portrait is on the obverse.

P

Premium: The amount paid above the value of the metal. It covers manufacturing, distribution and the seller’s margin, and for collectables, demand.Goldback premiums explained
Proof: A finish struck with specially prepared dies and blanks for collectors. Proof coins usually sell at a substantial premium to bullion versions.

R

Round: A coin-shaped piece of bullion made by a private mint, with no face value and no legal tender status.

S

Silverback: A silver note made with the same foil technology as Goldbacks, holding a measured amount of .999 silver.What are Silverbacks?
Sound money: Money whose supply cannot be expanded at will. Historically that meant gold or silver.What is sound money?
Sovereign: A British 22-carat gold coin containing about 7.32 g of fine gold. Sovereigns minted from 1837 onwards are sterling currency, so gains on them are exempt from Capital Gains Tax.Britannia vs Sovereign
Spot price: The market price of a metal for immediate delivery, usually quoted per troy ounce. Retail prices sit above it and buy-back prices below it.What dealers pay
Spread: The difference between a dealer’s selling price and its buy-back price for the same item.What dealers pay
State series (Goldback): A set of Goldback denominations issued for one US state, each note with its own artwork.The different series explained
Sterling silver: A standard of 925 parts per thousand silver, used for silverware and jewellery.

T

Troy ounce: The unit used for precious metals: 31.1035 grams, about 10% heavier than the ordinary ounce of 28.35 grams.

U

Unallocated storage: Storage in which you own a claim on a pool of metal rather than specific bars or coins. If the provider fails, you may rank as an unsecured creditor. Compare allocated storage.Vault storage costs
UV-reactive ink: A Goldback security feature: hidden imagery that appears under ultraviolet light. It is on the reverse of 2025-dated notes and part of the front artwork from 2026. Earlier notes do not glow.Goldback security features

V

Vacuum deposition: The process used to make Goldbacks: gold is vaporised in a vacuum chamber and laid onto polymer in controlled layers.How Goldbacks are made
Valaurum: The US company that manufactures Goldbacks for Goldback, Inc., using its gold-foil technology.How Goldbacks are made
VAT: Value Added Tax. Investment gold is exempt in the UK; silver and platinum bullion generally carry VAT at the standard rate.Gold investment in the UK
Vaulting: Storing metal with a specialist in an insured, secured facility rather than at home.How Yard Mint vaulting works