British Columbia, Canada Taxes

[anathema]

I have a few tax questions...

I current Live in BC, Canada.

1.
If I were to purchase a boat in BC which I am planning to sail away for better than a decade if everything works out, do I still have to pay taxes (GST/PST) ? Or can I do an offshore deal of some kind for the boat and sail away (I know some states have a 90 day grace period etc). In this case, to sell the boat one day down the road, would there be a problem? Could I sell in the USA/Caribe? Or would not having paid taxes be a problem or stop me from obtaining the documents I need.

2.
My other option is to buy a boat in Florida, Annapolis, etc. There are WAY more boats of the type I am looking for, especially in Florida. There are 3-4 CSY-33s in Florida right now, and countless Westsail 32s, etc. I would have a much bigger selection of any boat I chose.

Lets say I bought the boat in Florida and sailed for a decade. Would re-selling in the USA be a problem? Would coming back to Canada for any reason be a problem? How about selling in BC ?

Thanks for your help everyone!

[Evan]

If you're a Canadian citizen, you will only be able to state register a US boat, not document it. There is another thread about the perils of that in some of the Caribbean islands. Re-selling in the US would not be a problem as it would still be a US boat.

If you bring it back to Canada, you will be liable for duty and GST. If you can prove it was built in Canada or US (actually kinda hard to do with a long gone builder) you won't pay duty due to NAFTA. I sold my Can. flag boat in the US. Had to import it, proved (with a very old magazine article) that was built in Canada. I had to post a small bond with a customs broker in case I lied on the paperwork. It cost my about $300 for a 30' boat in 2001.

[waverider]

You can buy a boat in the US and just registar it with the Canadian Government. They do not collect provencial taxes. They do charge GST but again if the boat is older it maybe excempt from GST too.

[Vasco]

If you buy the boat in the States and not bring it back to Canada you can still register it as a Canadian vessel. Under 12 meters you will not even require a tonnage survey. If you do not bring the boat to Canada you will not be required to pay any duty or Canadian taxes. If the boat was built in the States you'd have no problem selling it there but should be cognizant of the requirements on your US cruising permit for selling a boat in US. See below for Canadian registration details.
Registration of Vessels: Overview - Vessel Registration Office - Marine Safety

[anathema]

So it sounds like, if I get a boat in Florida/Annapolis etc, then cruise until I am done, then sell again in Florida years later, I would never have to pay taxes of any kind.

I could still register the boat as Canadian and they wouldn't hunt me down for GST etc if it never entered Canadian waters?

[Vasco]

Originally Posted by anathema

So it sounds like, if I get a boat in Florida/Annapolis etc, then cruise until I am done, then sell again in Florida years later, I would never have to pay taxes of any kind.

I could still register the boat as Canadian and they wouldn't hunt me down for GST etc if it never entered Canadian waters?

Yes, that's the way it goes. Actually you can bring the boat to Canada but only for repairs or other work and cannot use it.

[anathema]

Hm Perfect that is exactly what I wanted to hear! Not often you get that

I have a feeling I will end up on the lower east coast somewhere looking at as many boats as I can There is a NICE looking CSY-33 in turnkey condition though here in BC which I would like, but in a year or two when I buy, I imagine it will be gone. One never knows though. I don't really want to sail down the PNW coast as a relatively green sailor though, I have heard it can be non-fun.

[Charlie]

Tax ramifications aside you can spend years in the PNW cruising and never see all there is to be seen. The West Coast doesn't have to be horrible it depends on your timing and luck.

[anathema]

Heh I have driven the PNW coast all the way down to cali and back, and its a very beautiful place.

All I am saying is that I will be a fairly green sailor when I first set sail, and I REALLY don't want to depend on luck to get me through.

If I catch a storm with a Lee shore to my east and don't have the expertise to beat my way away from the shore, me, my wife, and maybe my cat if I take him could all die.

So at least at first, I may take a bit harder look at something on the middle to south Atlantic USA coast for my purchase. Then I can sail in the (relatively) easier sailing of the Caribbean and Mexico's east coast. I have a small cabana on the ocean in Puerto Escondido, Mexico(This one: http://maps.google.ca/maps?hl=en&q=P...z=4&iwloc=addr ). So I may cross the canal and make home base in that area during hurricane season if it is safe. No atlantic hurricanes hit there, or almost never but I am not sure about pacific hurricanes.

[Charlie]

Originally Posted by anathema

Heh I have driven the PNW coast all the way down to cali and back, and its a very beautiful place.

All I am saying is that I will be a fairly green sailor when I first set sail, and I REALLY don't want to depend on luck to get me through.

The real beauty starts noth of Lund BC. there are no costal highways above that from what I understand. If you are looking for a place to learn to sail in relative safety then The area around Vancouver Island Desolation Sound and the like are great training grounds for navigation skills, sailing in both light and heavy air, and self reliance.

When you do your calculations on what is a better value to pay the taxes or to avoid them don't forget that there will be the expense of getting to the boat and back to BC. A couple of trips to Florida will add up. I had my boat in Canada, Washington State and Oregon because I didn't think it was fair for the State of California to collect a tax on a boat that I was only going to keep in California for a year then bring to Mexico. In the end my experience is that it would have been cheaper (or the same) to pay the tax. Instead I had to spend the money I would have on taxes to travel back and forth from CALifornia to BC. I'm glad I did it but keep the travel expenses in mind when making your decision.

[anathema]

Ya thanks charlie it is definitely something to consider. I certainly don't plan on doing a 'few' trips anywhere though. Once I sell my house, I am free. I would fly down to florida and look at a ton of boats. Rent a place for a month or even buy a nice tent and stay in a nice campground. I'm sure there are many. Once I buy the boat, I will move aboard immediately and begin refitting for my needs. Almost every boat on Yachtworld I've found that I like seems to be in Florida.

There are 5 CSY33s on yachtworld, 4 of them in Florida. A few Westsail 32s in florida. Quite a few PSC31s there too.

There are actually a lot of Westsail 32's on the California coast. This would be perfect for me as I could then just sail straight south to Puerto Escondido, coast hopping all the way, then when I feel more ready, cross the canal and head into the Caribe, or head north into the sea or cortez, which I have heard fantastic things about.

So many options!

If I buy a boat in BC, not only might I have to pay taxes, I will have to travel down the PNW coast, which could entail waiting for the right season if I don't time the purchase exactly right. If it costs me another year of living in Canada this is very cost prohibitive.

I have heard good things about desolation sound, and I did plan to sail around the BC coast a bit training before making any semi-blue water trip down the PNW if that is the option I chose.

[Vasco]

anathema,

I think you've got the right idea. Too cold in B.C., no palm trees and the water's not the right colour.

[Amgine]

I'd suggest learning here, unless you have money to head south *now*. You needn't buy here though. Take classes in the PNW, maybe charter a boat or three next summer (yes, there are lots of charter options here, and just south of the border as well.)

But if you're ready to go, go now. Don't wait until next spring, get south and get on the water. Prices are good now, and they likely will be starting back up next spring (unless this recession is deeper/broader than I hope.)

[jackdale]

Originally Posted by Charlie

The real beauty starts noth of Lund BC. there are no costal highways above that from what I understand. If you are looking for a place to learn to sail in relative safety then The area around Vancouver Island Desolation Sound and the like are great training grounds for navigation skills, sailing in both light and heavy air, and self reliance.

I whole heartedly agree. The other great things about Desolation Sound:
1) Warmest water north of Panama
2) Great oysters and prawns
3) Great fresh water swimming (Black Lake, Cassel Lake, etc.)
4) Spectacular views, especially from Sarah Point looking up Desolation Sound
5) Great anchorages
6) Fine fresh pastry at Refuge Cove or at Nancy's Bakery in Lund



If you can get into the Broughtons, you will be in one of the few less visited areas.

If you sail can here, you can sail anywhere. Big tides, big currents, lots of rocks.

There are at least three sailing schools in the area. Two in Comox, one in Powell River.

If you want find out how you react to the big ocean, you can also do one of the Around Vancouver Island trips. I do three a year; many of my clients are seeing how the respond to the open ocean.

Jack

[anathema]

Originally Posted by Amgine

I'd suggest learning here, unless you have money to head south *now*. You needn't buy here though. Take classes in the PNW, maybe charter a boat or three next summer (yes, there are lots of charter options here, and just south of the border as well.)

But if you're ready to go, go now. Don't wait until next spring, get south and get on the water. Prices are good now, and they likely will be starting back up next spring (unless this recession is deeper/broader than I hope.)

Well, I will be taking classes shortly, but...

I cant afford to buy a boat or go south at all until my house sells. I have about 150 thousand in equity in it, and plan on using 50-60 of that for the boat.

Once I have the money, I COULD buy in BC, but there are still the problems mentioned before of thrusting a green sailor into the challenging conditions of the PNW on my sail down to Mexico. If I buy in Florida(or similar) I am most of the way there, and my sail is through the calm Caribbean to learn and plus the boats are much cheaper in the states compared to Canada. A CSY-33 -starts- at 50k here compared to 30k in the USA for a similar condition boat. Plus I'd pay no taxes.

Like I said before, cali would be ideal because I end up on the right coast, I can cruise through the sea of Cortez (which I have heard from quite a few places now that it is even a nicer cruise than most anywhere in the Caribe) and I still get the advantage of the cheaper boat and no PNW coast.

I guess it will come down to it more when I am really ready to buy. I Certainly appreciate the advice though, keep it coming!