Gold Purity and Silver Purity – A Complete Guide

Gold and Silver Purity

Gold Purity and Silver Purity

When buying precious metals, it is important to have an understanding of the gold purity or silver purity of the bars or coins. Why? Because a small difference in gold or silver purity can have an impact upon the overall value of the gold or silver contained in a coin or bar. And therefore the price you pay.

 

Gold Purity: Carats vs Fineness

The gold bullion investment industry expresses gold purity differently to the gold jewellery industry.

 

Royal Canadian Mint 2018 Gold Maple Leaf Coin 1 oz Reverse - gold purity 9999
The Canadian Maple Leaf coin has a fineness of 9999. This means it is 999.9 parts out of 1000 pure gold.

Gold Bar and Coin Purity = Fineness

When buying gold bullion bars and coins you will usually see gold purity referred to as “fineness”. This is a shortened version of the term millesimal fineness. A system expressing the purity of precious metals by parts per thousand.

For example a gold fineness of 999 means 999 parts gold and 1 part other other metal.

 

Millesimal Fineness and Percentage Purity

Millesimal fineness is often used interchangeably with percentage purity. For example:

990 = 99%
999 = 99.9%
999.9 = 99.99%

A gold purity of “Four nines” or 999.9 is the most common for gold coins and bars today. Popular bullion coins like the gold maple contain 99.99% pure gold.

 

Gold Jewellery Purity = Carats (or Karats)

Gold Jewellery purity in carats
Gold jewellery purity is expressed in carats

Whereas when buying gold jewellery you will still see gold purity defined in carats (in North America usually spelt karats instead).

A carat is simply 1/24 part of the whole. So 24 carat gold is “pure” gold. However to achieve 24 carat status gold only needs to be 990 pure. As we’ve learnt already this means only 990 parts out of 1000 pure.

Whereas gold bullion bars and coins are usually 999 or 999.9 pure. Hence why carat is generally not used in expressing purity in gold and silver bullion – as a karat is not a fine enough measure.

Because gold is so malleable, when used to make jewellery it is often mixed with other metals to give it more strength and durability. Or simply to alter the colour. For example:

  • “White Gold”: Nickel, zinc, manganese and tin are added to gold
  • “Rose Gold”: Copper is added to gold

 

Converting Carats into Fineness

To convert carats into fineness, simply divide the carat by 24 and multiply by 1000.
For example, 18 carats = 18/24 x 1000 = 750 fineness

 

Gold Purity Conversion Chart

The below chart converts gold carats into percentage purity and millesimal fineness:

Gold Purity (Carat) (% Pure) Fineness
24 carat gold 99+ 990
22 carat gold 91.7 916/917
18 carat gold 75.0 750
14 carat gold 58.3 583/585
12 carat gold 50.0 500
10 carat gold 41.7 416/417
9 carat gold 37.5 375

 

Silver Purity

Like gold, silver purity was also once measured in carats. However now even in silver jewellery it is not so common to see. These days silver jewellery purity is more likely to be expressed by a stamp stating the fineness.

 

Silver Purity Conversion Chart

Pure silver is also quite soft and therefore like gold is mixed with other alloys to give it more durability.

Below are some common names for various purities of silver.

Purity (wt.%) Fineness Common Name
99.9 999 Fine or pure silver
95.8 958 Brittania
92.5 925 Sterling silver
80 800 Jewellery silver

Source: https://www.azom.com/article.aspx?ArticleID=2466

Interesting fact: The British pound coin originally weighed one troy pound of sterling silver, giving the currency the name “pound sterling”. Source.

But with silver bullion bars and coins, the preference is for silver purity of at least 999 (or 99.9% pure).

For example, the popular 1 kilogram silver bar is 999 or 99.9% pure silver. While some silver bullion coins such as the Canadian silver maple coin and the 1 oz Perth Mint Silver Kangaroo Coin are 999.9 or 99.99% pure silver.

Read more: Coins vs Bars Which Should I Choose?

 

GST on Gold and Silver in New Zealand – Depends on the Purity

In New Zealand knowing the purity of gold and silver is also important as the purity of both precious metals impacts whether they attract Goods and Services Tax (GST) or not.

So long as gold, silver and platinum meet the below purities they are GST exempt in New Zealand.

From the IRD website:

Fine metal is any form of:

gold with a fineness of not less than 99.5%
silver with a fineness of not less than 99.9%
platinum with a fineness of not less than 99%.

The supply of fine metal is an exempt supply, such as any sale of fine metal by a dealer, or anyone importing fine metal.

http://www.ird.govt.nz/gst/additional-calcs/calc-spec-supplies/calc-exempt/#gsp

For a full (but complicated!) explanation of why gold and silver are GST exempt see:
http://taxpolicy.ird.govt.nz/publications/2015-ip-gst-current-issues/chapter-4

 

Some Common Coins are not GST Exempt in New Zealand Due to Their Purity

It’s important to be aware that some very well known coins are not GST exempt in New Zealand due to their purity being less than 99.5% pure gold. So when these types of coins are purchased in New Zealand they will cost 15% more than other gold bullion coins that are 99.99% pure, as GST is added to the sale price.

These coins include:

 

1 oz South African Gold Krugerrand- 22 CaratThe South African Krugerrand – 22 Carat or 91.67% Pure

The Krugerrand is minted from gold alloy that is 91.67% pure (22 carats). It’s actual weight is 1.0909 troy ounces (33.93 g). The Krugerrand coin still contains one troy ounce (31.1035 g) of gold.

 

1 oz American Gold Eagle - 22 CaratThe American Gold Eagle – 22 Carat or 91.67% Pure

The 1oz Gold American Eagle coin contains a full troy ounce of gold. However in terms of purity it is only 91.67% gold (22 carat), 3% silver, and 5.33% copper. So when purchased in New Zealand an additional 15% GST is added to the price.

 

1 oz British Gold Sovereign - 22 CaratThe British Gold Sovereign – 22 Carat or 91.67% Pure

Gold Sovereigns weigh 7.98 grams and are made of 22 carat gold or 91.67% pure. Therefore a gold sovereign contains 7.315 grams or 0.2353544 troy ounces of pure gold.

 

Read more: What is a Troy Ounce? Troy Ounce vs Standard Ounce

 

How to be Sure of the Purity When Buying Gold and Silver Bullion

1 Kg Silver Bar - Local New Zealand Refined Cast Ingot - Silver Purity of 999
Locally New Zealand refined silver bars are stamped with 999 meaning 99.9% pure silver content. They are also stamped with the suppliers hallmark and weight.

Local gold and silver bars/ingots are stamped with the suppliers “hallmark” and with either 9999 for gold (four 9’s or 99.99% pure) or 999 for silver (three 9’s or 99.9% pure).

Also, in terms of ensuring the purity of all supplied products, the local New Zealand suppliers we use regularly exchange metal with other companies locally and in Australia. When this happens the metal is assayed again.

Therefore if there was ever a problem with purity, they would be found out quickly. As reputation is everything, this would put them out of business. They are family owned and run businesses, conservative by nature and have been around for over 35 years, supplying precious metals to private investors but also to jewellers in NZ.

Some overseas products such as bars from Swiss Refiner PAMP come with assay certificates and individual serial numbers. These cost more than local gold and silver. For example for gold, another $45 per 1 oz bar more and for silver, a further $50 per 1kg bar. These are more readily exchangeable overseas, so depending on where you intend to sell them, may be a better option for you.

 

1 oz Canadian Gold Maple Coin 2018-Gold Purity 99.99% pure gold

Hallmarks and Purities

All products we sell at Gold Survival Guide have the gold or silver purity clearly marked as part of the suppliers hallmark. Also each product listing on this website has the product purity clearly stated on it. Shop gold and silver products below to see:

Buy Gold

Buy Silver

 

 

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