Numismatic coins are coins valued for rarity, condition, design, finish or history, so their price can sit far above the value of the metal inside. Proof, coloured and low-mintage releases are typical examples.
Numismatic versus bullion
A bullion Kangaroo and a proof Kangaroo can share a design, a weight and 99.99% purity, yet one sells near the spot price and the other at a multiple of it. The difference is what you are paying for.
| Bullion coin | Numismatic coin | |
|---|---|---|
| Main value | Metal content | Rarity, finish, design, condition |
| Mintage | Large, often unlimited | Limited, often a few thousand or fewer |
| Finish | Standard bullion strike | Proof, high relief, coloured, gilded |
| Packaging | Capsule or tube | Presentation case with certificate |
| Price versus metal | Small premium | Large premium |
A proof coin is struck several times with polished dies on polished blanks, leaving a mirror field and frosted design. Collectors also chase privy marks, which The Perth Mint adds to some bullion issues, and early dates. The mint publishes declared mintages for its bullion coins, so you can check how rare a coin really is before paying extra.
When you overpay
Fixed-number example: suppose a 1 oz gold proof coin is issued at 2.5 times its metal value. If the gold price stays flat and collector demand fades, a dealer buying it back at bullion value pays you roughly 40% of what you spent. Gold would have to rise 150% just to break even. Numismatic value can rise, but only if collectors still want that specific coin when you sell.
- Most bullion dealers pay metal value for proof and coloured coins.
- Colour, gilding or a special finish can take a coin outside the GST definition of investment form, so 10% GST may apply. See GST on gold.
- The bid-ask spread on collector coins is the widest in the market.
Tax angle: collectables
Under Australian CGT rules, coins or medallions kept mainly for personal use or enjoyment can be collectables. Capital losses on collectables can only offset gains on collectables, and a collectable bought for $500 or less is ignored for CGT. Bullion held as an investment follows the ordinary CGT rules. If your collection is large, talk to a registered tax agent.
If your goal is ounces
Buy the bullion version. The Perth Mint sells the same Kangaroo, Kookaburra and Lunar animals in plain bullion strikes. Browse Lunar Series III bullion coins or the gold coins category, and see the lowest delivered prices in the cheapest gold coins ranking. Keep collector coins for the pleasure of collecting.
Related terms
Bullion Premium Over Spot Bid-Ask Spread GST on Gold and Silver in Australia
FAQ
Are proof coins a good investment?
Proof coins only beat bullion if collector demand rises; most dealers buy them back at metal value, so you can lose the collector premium.
What is the difference between a bullion and a proof Kangaroo?
Both contain the same gold, but the proof is a limited, mirror-finish collector strike sold well above metal value, while the bullion coin trades near spot.
Are collector coins taxed differently in Australia?
They can be: coloured or proof coins may carry GST, and coins kept for personal enjoyment can be collectables for CGT with separate loss rules.