Both are UK legal tender, both are capital gains tax free for UK residents, both are VAT free. The difference is size, alloy and premium.
Britannia
One troy ounce of 999.9 fine gold. The larger unit, so the premium per gram is lower, and the coin most easily sold to any dealer in the world.
Sovereign
7.32g of fine gold in a 22 carat alloy, so it is harder-wearing. About a quarter of the outlay of a Britannia, which makes it easier to sell a little at a time and easier to give as a gift. The most recognised gold coin in Britain.
Our suggestion
Buy Britannias for the bulk of a holding and Sovereigns for flexibility. Pre-owned Sovereigns at a lower premium are usually the best value gold on the board.