Selling gold to a friend or family member

When this is genuinely the best route

No commercial buyer can offer what a private sale within a family can: the piece keeps being a piece. A ring that goes to a niece who will wear it is not competing with a refinery, and comparing the two on price misses the point of the transaction entirely. If someone you know wants it, wants to wear it, and the money is a secondary consideration, that is the right answer and there is nothing to optimise. For a benchmark either side can check, the process behind selling to a postal buyer is a reasonable starting point.

It also removes almost all of the friction. No postage, no listing, no counter, no waiting. The trade-off is that it also removes almost all of the structure, and structure is what stops a straightforward transaction turning into a long-running awkwardness.

What a private sale does not come with

• No independent testing. Neither party knows the purity unless one of you has it assayed, and "it says 18ct" is a maker’s claim until it is verified.
• No independent price. Two people who like each other guessing at a number is how both of them end up quietly wondering afterwards.
• Fewer consumer protections. Consumer legislation is built around traders selling to consumers. A sale between two private individuals is a different footing, and both sides carry more of the risk themselves.
• No paperwork by default. If the piece later turns out to be something else, or the family circumstances change, there is nothing to point at.
• No arm’s-length pricing for tax purposes, which is the part that surprises people most.

The connected persons rule, plainly

HMRC does not accept a family discount as the disposal value for Capital Gains Tax. Under TCGA 1992, a disposal made otherwise than by way of a bargain at arm’s length, which includes a disposal between connected persons, is treated as made at the market value of the asset rather than at the price actually paid, and the same figure becomes the acquisition cost for the person receiving it (HMRC Capital Gains Manual CG14530 and CG14580, checked 6 August 2026).

Connected persons for this purpose include a spouse or civil partner, brothers and sisters, ancestors and lineal descendants such as parents, grandparents, children and grandchildren, and the spouses or civil partners of those relatives. Notably the definition does not extend to aunts, uncles, nieces and nephews (HMRC CG14580).

In practice this matters less often than it sounds, because most jewellery sales fall inside existing exemptions: personal chattels have a £6,000 disposal exemption per item, transfers between spouses and civil partners living together are generally on a no gain, no loss basis, and UK legal-tender gold coins such as sovereigns and Britannias are exempt from Capital Gains Tax. But if the piece is substantial, the market value rule is the one that applies, not the price on the note. This is general information, not tax advice. Check gov.uk and speak to an accountant, and see our tax guide.

If the item came from an estate

Selling an inherited piece cheaply to one relative while an estate is still being administered is where family arrangements most often go wrong. Until the estate is distributed the executor controls disposal, jewellery valued above the HMRC threshold has to be reported at open market value at the date of death on IHT407, and an under-value transfer to one beneficiary is visible to the others. Agree it openly, value it independently, and record it. See selling inherited gold during probate.

How to do it properly in four steps

1. Establish what the piece actually is. An assayed written valuation removes the guesswork about purity and weight for both of you, and it is free to obtain and free to decline.
2. Agree the basis before the number. Metal value, metal value plus something for the design, or a family price with the difference acknowledged as a gift. Say which one it is out loud.
3. Write it down. Date, description, hallmark, weight, price paid, both names. A single sheet of paper is enough and it protects the relationship more than it protects either party.
4. Tell the people who would be surprised to find out later. Most family disputes about jewellery are about not being asked rather than about the money.

When to use a commercial buyer instead

If nobody will actually wear it, a private sale is just a slower version of selling it, with a relationship attached. Broken chain, unmatched earrings, bent or unmarked pieces and dental gold have no wearer waiting for them, and asking a relative to buy them creates an obligation rather than a favour. Send those for a metal valuation and keep the family conversation for the pieces that deserve one.