Investing in gold: the basics, taxes and buying tips

Contents · 10 sections

1. Gold in 2025: from 3,000 to over 4,000…
2. Why did gold rise so much?
3. Gold as an investment and a store of…
4. Physical investment gold and other ways to invest…
5. Pros and cons of investing in physical gold
6. Pros and cons of investing in non-physical gold
7. How is gold taxed in Bulgaria?
8. How much gold should a portfolio hold?
9. Tips for buying gold coins and bars
10. Popular gold investment products

When I wrote the first version of this article in the summer of 2022, the war in Ukraine and post-pandemic inflation had sent many people queuing outside banks and precious metals dealers. Gold was then around 2,000 dollars per troy ounce and looked expensive. Three years later it is more than twice as high.

2025 is one of the strongest years for investment gold in modern history. In this updated article we look at what happened to the price, why gold rose so much, the ways to invest in it from Bulgaria, how gains are taxed and what to watch out for when buying coins and bars.

Gold in 2025: from 3,000 to over 4,000 dollars

• 14 March 2025: gold crossed 3,000 dollars per troy ounce for the first time ever.
• 8 October 2025: just seven months later it passed 4,000 dollars. It was up around 50% year to date, its best performance since 1979.
• 20 October 2025: a new record of about 4,380 dollars per ounce, roughly 3,760 euro (about 121 euro per gram).
• 21 October 2025: a day later the price fell by as much as 6.8% intraday, the biggest one-day drop in about five years.

That last date is a useful reminder: gold is a reliable store of value over the long term, but it can be volatile in the short term too.

Why did gold rise so much?

• Central banks are buying. According to the World Gold Council, central banks bought 1,044.6 tonnes of gold in 2024, the third year in a row above 1,000 tonnes. Poland, Turkey, India and China were among the most active.
• Investors are returning to ETFs. Gold-backed funds took in 397 tonnes in the first half of 2025, the strongest first half since 2020, and the third quarter was a record with inflows of about 26 billion dollars.
• Lower rates and a weaker dollar. US Federal Reserve rate cuts and a weaker dollar make gold more attractive.
• Uncertainty. Trade tariffs, geopolitical conflicts and worries about government debt boost demand for safe assets.

Gold as an investment and a store of value

Thanks to its unique properties, the yellow metal has earned its place in investors’ portfolios and its reputation as a safe haven and a hedge against inflation. Let’s take a quick look at what makes gold special.

First, gold has to be mined and refined, and there is only so much of it. Modern currencies, by contrast, could in theory be printed without end. That scarcity is one of the reasons gold is so highly valued and holds its worth.

Another big advantage is that a small amount of physical gold can hold a lot of value. That makes it relatively easy to carry, so you can move value from place to place when you need to.

Historically, gold has not only held its value but grown it over time. That is one of the main reasons the precious metal is a good hedge against inflation and currency swings.

(Source: https://goldprice.org)

For example, after the war in Ukraine began in 2022, sanctions sent the Russian ruble into a temporary collapse, reaching around 138 rubles to the dollar in early March. People who kept their savings only in rubles lost a large part of them within days.

In an economic emergency, when currencies are unstable and losing value, people who keep all their savings in cash in a single currency can lose a big part of them very quickly. At the same time, the price of gold tends to rise, which protects the value of money invested in it.

On top of all that, gold has another quality investors count on: liquidity. In other words, you can sell it fairly quickly and turn it back into cash.

Tax treatment is another advantage: investment gold is exempt from VAT, and gains on bars and coins sold by individuals are in most cases not taxed. We cover taxes in more detail below.

These are some of the reasons gold remains a reliable choice for long-term investing and preserving value. If you decide to put part of your savings into gold, one of the first questions you’ll face is whether to buy physical investment gold or digital gold. Below we’ll look at the differences and at the pros and cons of each.

Physical investment gold and other ways to invest in gold

Investing in physical gold means buying and storing gold coins or bars. You can also buy gold online through a broker or other intermediary without ever holding it. Other options include gold ETFs (exchange-traded funds), mutual funds with exposure to gold, and shares in mining companies.

To decide which route to take, weigh the pros and cons of each. Here is a quick summary.

Pros and cons of investing in physical gold

One downside of physical gold is that it costs more. The price includes the costs of minting, packaging, shipping, storage and so on, on top of the gold itself. You’ll also pay a markup to the dealer who sells you the bars and coins.

Another challenge with physical gold is where to keep it. Gold is a strong, durable metal, but you still need to store it properly so you won’t have trouble selling it later. If the amount is small, you can keep it at home. In that case, choose a safe hiding place and don’t tell anyone exactly where it is. Unfortunately, keeping gold at home also means living with the risk of burglary and theft.

For larger amounts, one solution is a bank safe deposit box or vault. That option comes with extra costs, though, and some limits on when you can get to your gold.

Of course, owning physical gold has its advantages too. The biggest is that you actually hold your investment, which gives you more security in an emergency. Think of an extreme situation like a war, when ATMs stop working and banks may make it hard for people to get to their money.

Bad exchange rates can be a problem, too. At times like these, physical gold, which is easy to carry, lets you take your wealth with you and, if needed, sell it at close to the market price.

Many gold bars and coins have published buy and sell prices (tied to the current price of gold), and licensed dealers will buy these products back.

Pros and cons of investing in non-physical gold

Buying gold online through a broker or platform combines the flexibility of investing in stocks with the simplicity of investing in gold. One big advantage is how easy it is to buy on any of a number of platforms, such as Interactive Brokers, Revolut, Paysera and others.

You buy the gold at the market price. There may be a fee for the transaction itself, but you don’t pay for minting, shipping and so on, so it naturally costs less than physical gold.

Non-physical gold also solves one of the biggest headaches of physical gold: you don’t have to worry about where and how to store it. Another plus is that you can invest any amount you like. With coins or bars, on the other hand, you’re limited to the sizes they come in: 1 ounce, ½ ounce, 5, 10, 20, 50 or 100 grams and so on.

You can also invest in a gold ETF that tracks the price of gold. Popular ones include SPDR Gold Shares and iShares Gold Trust. Buying gold online through a broker or an ETF carries the risk that the intermediary (or intermediaries) goes bankrupt. The price of the ETF can also drift away from the price of physical gold.

Another option is a mutual fund with exposure to gold or mining companies, so you don’t have to track the price of the metal yourself. These funds usually charge management and entry fees, though.

You can also buy shares in mining companies, whose prices depend heavily on the price of gold. But it’s wise to understand stock trading well before you go this route.

To sum up, physical gold is best for long-term investing, while non-physical gold can be held for shorter periods and sold in literally seconds.

How is gold taxed in Bulgaria?

• VAT: supplies of investment gold are VAT-exempt. This covers bars of at least 995/1000 purity and coins of at least 900/1000 purity, minted after 1800, that are or were legal tender and sell for no more than 180% of the value of their gold content.
• Income tax on physical gold: income from selling movable property is generally not taxed, except for works of art, collectibles and antiques. According to a National Revenue Agency opinion, gold coins with numismatic value are taxed as collectibles, at 10% on the gain. Ordinary bars and modern bullion coins sold by an individual outside a business are, as a rule, not taxed.
• ETFs and ETCs: gains are exempt if the instrument trades on a regulated market in the EU or EEA. Otherwise 10% tax is due.

For larger amounts or if in doubt, I recommend speaking to an accountant.

How much gold should a portfolio hold?

There is no universal answer, but a share of 5% to 10% of an investment portfolio is most often cited. In an April 2025 study the World Gold Council modelled 5% as a sensible strategic allocation. Gold pays no dividends or interest and its long-term return has historically been lower than that of shares, so its role is more insurance and diversification than the main engine of growth.

Tips for buying gold coins and bars

If you’ve decided on physical gold, here are some practical tips for choosing the right coins and bars for your portfolio.

One piece of advice you’ll hear from many experts is to stick with popular products. They are more liquid, so they’re easier to sell. Later in this article we’ll look at some of the best-known and most popular gold bars and coins.

Should you buy heavier pieces? There are two sides to consider. On one hand, the heavier the product, the closer its price is to the market price of gold, so you get more for your money. On the other hand, when the time comes to sell, it may be a bit harder, because you need a buyer for the whole piece.

Experts also recommend looking for products with a narrow spread between the buy and sell prices.

Storing your gold properly matters, too, if you want to protect the value of your investment. After you buy coins or bars, leave them in their original packaging. Taking them out can damage them and make it harder for dealers to buy them back.

Just as important is where you buy your gold. Your options include some banks, licensed gold dealers and even private individuals. Buying from official, licensed dealers guarantees that you’ll get products of proven authenticity and quality.

Be especially careful if you buy anywhere else. A price well below the market price can be a sign of fraud. So always do your homework and look for reliable, licensed dealers.

Personally, I’ve bought gold from Limar24 (a Bulgarian gold dealer), both for myself and as gifts, and I’ve been very happy with them. To me, an investment coin or bar (even a modest one) makes a far better gift than, say, a piece of gold jewelry.

Popular gold investment products

Investment gold traditionally comes in two main forms: coins and bars. Below I’ll briefly introduce some of the most popular ones, the ones investors reach for most often.

Popular investment coins

• Vienna Philharmonic: one of the most popular gold investment coins, and more than once the best-selling gold coin in the world. It’s made by the Austrian Mint and, as the name suggests, it honors one of Austria’s national symbols, the Vienna Philharmonic. One side shows eight orchestral instruments, and the other shows the great organ in the Philharmonic’s concert hall.
• Australian Kangaroo: another popular, highly liquid gold coin. What makes this modern investment coin special is that its design changes every year, which also makes it tempting for collectors. Every design, though, features Australia’s national animal, the kangaroo.
• Napoleon: the 20-franc Napoleon III gold coin also deserves a look. With almost 6 grams of gold and an elegant design, it has become one of the coins collectors have sought most in recent years.
• Canadian Maple Leaf: made by the Royal Canadian Mint, this coin is known for its advanced security features, designed to make counterfeiting as hard as possible. That extra reliability, and the easier resale that comes with it, makes it a favorite for many buyers.
• Austrian ducats: these coins also come from the Austrian Mint, one of the oldest in Europe, which is why its products are in such high demand. The 1-ducat and 4-ducat coins show Emperor Franz Joseph, the longest-reigning Austrian monarch, on the front.

Gold bars

In Bulgaria, the most popular gold bars come from two of the best-known Swiss refineries: Valcambi and PAMP.

Valcambi is one of the younger Swiss refineries, founded in the 1960s. Even so, it has built a solid reputation and set itself apart from the competition.

Valcambi bars are known for their high quality and simple design, and they come with a certificate, which makes proving their authenticity easier than with coins. The Swiss refinery offers cast gold bars in a range of sizes, from one gram up to one kilogram.

One interesting product is the 1-ounce Valcambi bar, designed to compete head to head with 1-ounce investment coins. It is also highly liquid.

PAMP Suisse is one of the best-known names in precious metals, and it runs one of the largest precious metals refineries in Switzerland. PAMP bars are made to the highest industry standards, which is why investors around the world trust them and demand for them is high.

Based in Ticino, the Italian-speaking part of Switzerland, the company has long been a leader in investment bars. PAMP is famous for being the first to put an image on the front of a bar, when it launched its PAMP Fortuna line.

Like Valcambi, PAMP offers gold bars from 1 gram to 1 kilogram. All PAMP gold bars are 24-karat gold with a purity of 999.9. The PAMP Fortuna series is the most popular in its range.

The bars show Lady Fortuna on the front, and the series was the first line of gold bars to carry an artistic image. The back of each bar has the PAMP logo at the top, with the bar’s weight, purity and serial number below. The brand’s best-selling bar is the 1-ounce piece from this very series.

Is gold jewelry an investment?

In Bulgaria and the rest of the region, many people still see buying gold jewelry as an investment. But is it really? The short answer is no. Here’s why.

First, the law clearly defines what counts as investment gold, both its form and its purity. Gold in the form of coins (round) and bars (rectangular) is investment gold.

The law also sets a purity threshold: above 995 parts per 1,000 for bars and above 900 (about 21.6 karats) for coins. Gold jewelry doesn’t meet these requirements, which is why it doesn’t count as investment gold.

Dig a little deeper and you’ll see that jewelry gold is far less pure. Jewelry is usually around 14 karats (58.33% pure gold), while investment gold products, as I mentioned, are traditionally around 24 karats (nearly 100% pure gold).

On top of that, the price of jewelry usually includes labor and the retailer’s markup, which pushes up what you pay for the finished piece.

If you want to invest in gold, go for high-purity gold coins or bars.

Conclusion

Over the years, gold has proven itself a relatively safe store of value. Its price moves in cycles of ups and downs, and there are periods when it loses value. But historically, over the long run, gold has not only held its value but grown it. That makes it a low-risk investment and a popular way to diversify a portfolio.

Keep one more thing in mind, though: historically, gold has returned less than stocks and other higher-risk assets.

The records of 2025 show something else too: nobody can predict the perfect moment to buy. Instead of chasing the peak, it is wiser to buy in instalments over time and hold gold for the long term. For more on getting your finances in order, see Personal finance: first steps.

This article is not investment advice, and I am not an investment advisor. The price of gold moves, and like any investment, gold carries risks. So if you’re planning to take this step, do your own research, look carefully at the risks and, ideally, talk to a specialist who can help you make an informed decision.