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Old 20-02-2010, 07:41   #1
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Canadians Buying Foreign-Made Boats in US

Hello everyone, this is my first post! I am looking to buy a boat in the US to leave down there for winter use. Canadian winters are not really necessary!! The makes I am looking at are not manufactured in the US so from what i have been able to deduce are subject to a 9.5% duty, a GST 5% and a PST 7% charge. That's 23.5% on top of the value of the boat. Has anyone found a better way for a Canadian to buy a boat and still have enough cash left for fuel?!!
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Old 20-02-2010, 08:52   #2
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Greetings and welcome aboard the CF, canary.

There's no need to pay duty or Canadian taxes, provided you pay the US State sales tax, and register & berth the boat in that State.
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Old 20-02-2010, 11:28   #3
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Thanks GordMay. Can a Canadian obtain US registration or do you have to be a US resident? Also what happens if i come into Canadian waters?
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Old 20-02-2010, 12:52   #4
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A Canadian (nor any foreigner) cannot obtain US Documentation, but anyone (even Canadians) can get State Registration.
If a Canadian brings his American vessel into Canadian waters, hes at home, and his boat is visiting, requiring a cruising permit.
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Old 20-02-2010, 13:57   #5
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Thanks for clearing that up for me! My choice of boats just got bigger!!
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Old 20-02-2010, 18:48   #6
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Quote:
Originally Posted by GordMay View Post
If a Canadian brings his American vessel into Canadian waters, hes at home, and his boat is visiting, requiring a cruising permit.
As I understand it, you can register your boat in Canada but not have to pay the GST unless you bring it into Canada; just pay the PST in the province it's registered in (Edmonton looks like a good port of registry ). Would you still be able to visit Canada on a cruising permit and not pay GST?
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Old 19-04-2010, 08:21   #7
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Quote:
Originally Posted by Lodesman View Post
As I understand it, you can register your boat in Canada but not have to pay the GST unless you bring it into Canada; just pay the PST in the province it's registered in (Edmonton looks like a good port of registry ). Would you still be able to visit Canada on a cruising permit and not pay GST?
I'm looking to find a answer to this question to.....
I posted a tread regarding this question...
As a Canadian citizen, living in Europe, I would like to register my boat in Canada but avoid the tax legally by never sailing into canadian waters...
All comments welcome...
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Old 19-04-2010, 09:37   #8
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Greetings Bonobo

I'm Canadian and had the same question you were asking. Here's the information I was able to gather:

A Canadian can purchase a NAFTA built boat and bring it into Canada to be documented or registered without having to pay duty, just GST and PST (still a healthy sum)

You have identified the taxes and duty correctly if you buy a boat that is not NAFTA built and are planning to take it into Canadian waters.

As a Canadian, you can document a boat in Canada you have purchased outside of Canada without paying the duty or taxes providing you never take the boat into Canadian waters (which includes even dropping the hook on Canadian soil underwater). If you choose to have your boat registered in a province however, you will need to pay that provinces provincial tax.

If you then bring the boat into Canadian waters for any reason, you will become obligated to pay the remaining amounts which include the duty and GST.

Something else to take note of. Right now, the Canadian dollar is close to par with the US dollar, but that fluctuates. As far as the Canadian government is concerned, the exchange rate for your calculations is determined on the day of importation, not the date of purchase, meaning if you bought a boat for 100,000US, right now you're paying about 100,000 CAD. However, if you go to import the boat in years time and the dollar drops to 90 cents US, your exchange rate would be different by 10% from date of purchase. This means you're paying duty and taxes based on $110,00. Playing exchange rates is always a gamble, but it's good to have the info.

Hope that helps.
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Old 19-04-2010, 10:06   #9
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Hello Stoney,

Thank you very much for the helpful reply ! I really appreciate !!

Where did you find the info ? Is there a official text saying this ?

I will be in Ottawa next week for a couple of days and will try to know more about Registration.

You use the term "Document" the vessel and "register" in a province ???

What is the difference ?
There are provinces with no PCT if I remember correctly ....??

Marc
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Old 19-04-2010, 10:53   #10
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Hi Bonobo and Canary too

Some of this we've picked up in discussion with our broker and other boaters, but the majority of it we got in a phone call straight from Canada Customs.

The difference between documented and registered is whether you provincially register your boat through the licensing agency like a car, or federally document your boat via transport Canada. We chose to go with federal documentation as we never plan to bring the boat into Canada and we plan on some distant cruising. I have been told if you are planning to go cruising to distant shores, federal documentation is more readily accepted by all the foreign government agencies you come across, however I personally don't have much experience to back this up as of yet.

What this means is you are provided with a Transport Canada number you must "permanently" affix to some location on your boat. It doesn't have to be visible, however you do have to be able to show the number to coast guard etc if asked. What we did was place the number in an easily accessible spot under the sole with stick on lettering, and then applied clear epoxy over that. You also have to use an official port as your hailing port. In most cases these are the capital cities, but there are exceptions.

With provincial registration, you are not federally documented, but registered by the licensing agency of your province. This is where you see the license numbers generally placed on either side of the hull near the bow. We weren't going this route, so I don't know all the advantages, disadvantages of provincial registration. I have read, but again this is unverified, that a boat registered (as an example) in Alberta, that actually lives in BC, does raise red flags for the BC Licensing agency. I'm sure that would go for all the maritime provinces.

As I don't have personal experience taking my boat in to Canadian waters, I can't speak as to what would happen trying to keep a documented boat on a permanent basis in a provinces waters, but it doesn't sound like that is what you are trying to do anyway.

Cheers
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Old 19-04-2010, 11:21   #11
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Thank you again Stoney !!!!

Exactly the info I needed !!

As written previously, I will ask all these questions again "officially" in Ottawa next week.
I needed to be sure i would not look as a fool asking for something impossible...
And I don't think it is illegal to ask questions directly to the customs or VAT people regarding "legally" avoiding taxes..


I would go for a Federal document off course ! I need a bulletproof document for the rest of the world. Cuba, Venezuela, Patagonia, Chile, etc....
I know I have to make a cross over sailing in Canadian waters
( sad,.... I will not be able to sail the inside passage and the st Lawrence...) But saving over 200.000 $ is taxes is worth a few sacrifices...
Alaska will still be possible....
And I can still de-register the canadian flag and sell myself the boat back as European in 5 years or so when it is older so I could be charged an "affordable" VAT in Spain or portugal on a old second hand boat...

Where do I ask for the radio license, call sign and MMSI number ??

Any suggestion on insurance for a live aboard family around the world for 5 years ????

I sounds like a novice asking all these questions but I'm only used to the French system for now.

Marc
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Old 19-04-2010, 11:46   #12
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I hope the information is useful for you.

For the MMSI, and station license, and generally anything radio related, contact Industry Canada. They are the agency that regulates all of that.

As for insurance, I think every situation is so different, and it can even depend on the broker. We found a broker in Vancouver who has been great for us.

And believe me, I had, and still have many questions. Between systems, engines, maintenance, rigging, sails, governments, cruising permits, and red tape, there is always much to learn.
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Old 19-04-2010, 12:21   #13
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For these types of questions why don't you just get in contact with your member of parliament? That's what they are there for. Nothing makes them happier than making themselves look good to a voter. Answers on a forum, althought can be correct, does not beat an official written answer to a written question.
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Old 19-04-2010, 12:41   #14
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Mmmmmmm Who is my closest member of Canadian parliament here in Belgium ???

And do not reply "the Canadian consulate" !!!! They are Belgian employees who don't know sh*** outside the delivering of a new passport...

If i rely on this forum for my questions, or at least a guideline for them.... it is because i have been looking for months elsewhere with no result...

Marc
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Old 19-04-2010, 14:42   #15
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In BC the provincial government has been campaigning for a combined PST and GST which would be called the HST. The combined tax for private sales of boats and cars will be raised to 18%. There is growing opposition, some saying the tax should be caled the VAT ( vaseline added tax) After winning election by campaigning against the idea , he plans to bring it in this summer.
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