Platinum and palladium are rare precious metals, but their prices depend above all on industry, especially catalytic converters for cars, and on mining in a handful of countries. That makes them more volatile than gold. In the UK they carry 20% VAT when bought for delivery, spreads are wider and fewer dealers trade them, so whether they suit you depends on whether you accept those risks and costs.
What they are used for
- Palladium: more than 80% of demand comes from autocatalysts, mainly in petrol cars. It is also used in electronics and dentistry.
- Platinum: autocatalysts (particularly for diesel engines), jewellery, the chemical and glass industries, oil refining, medicine and hydrogen fuel cells. Investment demand is a smaller share.
This means prices react to car sales, emissions rules and the shift to battery electric vehicles, which need no catalytic converter. When one metal becomes very expensive, manufacturers partly substitute the other, as happened after palladium’s record prices in 2022.
For long periods platinum was more expensive than gold. Since the mid-2010s, however, it has traded well below it. Rarity alone does not set the price: industrial demand and investor interest decide it. New uses such as hydrogen technology could add to platinum demand, but nobody can say with confidence how much or when.
Where they come from: concentrated supply
Mining is concentrated in a few countries. According to the US Geological Survey, South Africa produced about 70% of the world’s mined platinum in 2024, followed by Russia and Zimbabwe. Russia’s Nornickel produces about 40% of the world’s palladium.
Strikes, power cuts in South Africa or sanctions on Russia can therefore move prices sharply. In April 2022 the London Platinum and Palladium Market (LPPM) suspended two Russian refiners, so their newly produced metal no longer counted as Good Delivery in London. The World Platinum Investment Council has reported platinum market deficits in several consecutive years.
Peaks and crashes
| Metal | Event | Price (approx.) |
|---|---|---|
| Platinum | Peak, March 2008 | $2,280–2,300 |
| Platinum | Low, February 2024 | about $875 |
| Platinum | New record, late January 2026 | about $2,900 |
| Palladium | Record, 7 March 2022 | about $3,440 |
| Palladium | Low, February 2024 | about $860 |
Palladium lost about 75% in under two years. Platinum spent more than 15 years below its 2008 peak before passing it in 2026, and then fell sharply again. In February 2024 palladium became cheaper than platinum for the first time since 2018.
Comparison with gold and silver
| Factor | Gold | Silver | Platinum and palladium |
|---|---|---|---|
| UK VAT for delivery | None (investment gold) | 20% | 20% |
| Main demand | Jewellery, investment, central banks | Industry and investment | Mainly industry, especially cars |
| Number of dealers | Many | Many | Few |
| Price swings | Moderate | Large | Large |
| Mine supply | Spread across many countries | Spread, often as a by-product | Concentrated in a few countries |
Selling is different too. A gold bar or Sovereign can be sold to almost any dealer. With a platinum or palladium coin you may need to search for a buyer or accept a lower buy-back price, so find out where you could sell before you buy.
UK costs and tax
- VAT: the VAT exemption covers investment gold only. Platinum and palladium bars and coins bought for delivery carry 20% VAT, which you do not get back when you sell. Some dealers offer VAT-free storage in a bonded warehouse; VAT becomes payable if you take delivery.
- Wider spreads: fewer dealers stock and buy back these metals, so the gap between buying and selling prices is usually wider than for gold. See which firms trade them in our UK bullion dealers directory.
- Capital Gains Tax: the Royal Mint’s platinum Britannia is UK legal tender, and HMRC treats legal-tender coins as sterling currency, so gains on it are exempt. Gains on bars and foreign coins are within CGT, with a £3,000 annual exempt amount and main rates of 18% and 24% since 30 October 2024.
An illustrative example: if you buy a platinum coin at 30% above spot (20% VAT plus a premium) and the dealer buys it back at 10% below spot, the spot price has to rise by about 44% before you get your money back.
Smaller bars and single coins usually carry a higher premium per ounce than larger bars, which pushes the break-even point further away. Keep the invoice for every purchase and sale: you will need it to show your acquisition cost if a disposal falls within Capital Gains Tax, and it also makes resale to a dealer easier.
Forms on offer
- Bars from one ounce upwards from recognised refiners.
- Coins such as the platinum Britannia, the platinum Vienna Philharmonic and the platinum or palladium Maple Leaf.
- Exchange-traded products backed by metal in a vault. They carry no VAT and have small market spreads, but there is an annual charge and you do not hold the metal. You can follow listed markets on our UK stock market page.
Questions before buying
- Do you accept that the price depends heavily on the car industry?
- Is there a dealer that will buy this product back from you?
- Have you worked out VAT and the spread?
- Where will you store the metal and what will storage and insurance cost?
- How much of your savings could you hold in such a volatile asset?
For the more widely traded metals, compare UK gold prices.
Bottom line
Platinum and palladium are mainly industrial metals, with supply concentrated in South Africa and Russia. Their prices are far more volatile than gold: palladium lost about 75% after its 2022 record. In the UK they carry 20% VAT for delivery and wider spreads, so prices have to rise substantially before a sale covers costs; the platinum Britannia is free of CGT.
Sources: USGS: Platinum-group metals · World Platinum Investment Council · LPPM · HMRC CG78305
This is general information, not tax or investment advice.
Frequently asked questions
Is there VAT on platinum and palladium in the UK?
Yes. The VAT exemption applies only to investment gold, so platinum and palladium bought for delivery carry 20% VAT. Some dealers offer VAT-free storage in a bonded warehouse.
Is the platinum Britannia free of Capital Gains Tax?
Yes. It is UK legal tender, which HMRC treats as sterling currency, so gains on it are exempt. Platinum bars and foreign coins are not exempt.
Why did palladium fall so much after 2022?
After its record of about $3,440 in March 2022, carmakers partly switched to cheaper platinum and electric car sales grew. By February 2024 palladium had fallen to about $860.
Where are platinum and palladium mined?
About 70% of mined platinum comes from South Africa, according to the USGS. Russia's Nornickel produces about 40% of the world's palladium.
