Country of Registration for World Cruising

[Ocean2Free]

Being new to the world cruising idea. I have reviewed a number of threads and come to the view that there may be an advantage to having your vessel register in some specific countries, rather than your home country, well at least that was what I picked up from the threads. The countries that I have noted are BVI, St Vincent & the Grenadines, Grenada etc. Could someone explain why it would be advantageous to have a vessel registered in such countries, if you were considering cruising the world.

[rusky]

Check out Noonsite for advice on everything including visas etc. An Aussie registered yacht with aussies on board should find no dramas im most places. Aussies with a yacht of different flag may bring other dramas.

[Boracay]

As the old saying goes Australia might have many faults but registry problems and expensive yacht registrations are not often mentioned among them.

It may be better if you asked what problems could be expected from a registry of convenience...

[MarkJ]

Can you imagine going into a port with a passport of one country and a Registration showing another country but you as the owner?

You really don't need the hassel.

[barnakiel]

Originally Posted by MarkJ

...Can you imagine going into a port with a passport of one country and a Registration showing another country but you as the owner?

You really don't need the hassel.

...

Oh, really? I did not notice any hassle sailing a Swedish boat with my non-Swedish passport ...

Most boats I have met where the flags were (Panamian, BVI, Vanuatu, to name a few) were simply to avoid the tax. The boats are registered on a company and the owner of the company is not disclosed - hence - no tax in owners country (the owner owns the company, not a boat ;-))). Simple.

But it is equally common to meet plain cases when people buy a boat 'abroad' and stick to the original registration. Like me. And no problem ever.

b.

[Pelagic]

If you are a US citizen Mark, flagging your vessel in another country while world cruising is a good idea.

The primary advantage though is to not have to import your vessel into your home country...if you do not plan on keeping it there. Perfectly legal and ethical, just the same as if you were buying a foreign house

[goboatingnow]

Most boats I have met where the flags were (Panamian, BVI, Vanuatu, to name a few) were simply to avoid the tax. The boats are registered on a company and the owner of the company is not disclosed - hence - no tax in owners country (the owner owns the company, not a boat ;-))). Simple.

yeah , I'd suggest you avoid the EU and especially the UK with that type of setup. Mostcustoms officials see it for what it is , trying to avoid tax

[idpnd]

Originally Posted by goboatingnow

yeah , I'd suggest you avoid the EU and especially the UK with that type of setup. Mostcustoms officials see it for what it is , trying to avoid tax

The customs officials must respect whatever the flag in question is; most commercial vessels are registered in Liberia for instance - no problems there. These are either legal tax avoidance schemes or for reasons of more liberal legislation. This does not mean you incur any prejudice with customs officials.

[Hanna&Chris]

Originally Posted by idpnd

The customs officials must respect whatever the flag in question is; These are either legal tax avoidance schemes or for reasons of more liberal legislation. This does not mean you incur any prejudice with customs officials.

Which of these 3 nationalities would be the best to register your boat under for avoiding taxes and easy cruising in the Carribean and the Mediterrnean?

United States
Ireland
United Kingdom

[Dockhead]

Originally Posted by goboatingnow

yeah , I'd suggest you avoid the EU and especially the UK with that type of setup. Mostcustoms officials see it for what it is , trying to avoid tax

No they don't. Taxes and flags don't usually have too much to do with each other.

If you are an EU tax resident you have to pay VAT on your boat if you use it in EU waters, and the flag doesn't make any difference. If you are not an EU tax resident then you can sail in EU waters for 18 months at a time without paying VAT, if you are careful to follow procedures. The flag doesn't matter.

In some countries, like France and Spain, there are local taxes you have to pay if you live for six months or more in those countries.

And you don't pay any tax on your U.S. flagged boat, if you don't bring it into the U.S. Again, the flag doesn't matter.

People use BVI and Cayman flags for complicated corporate reasons which are not likely to be relevant to you. They run expenses through their boats or have charter income which they don't want to pay tax on.

Personally, my boat is U.K. flagged although I am a U.S. citizen. That's really only because she was VAT-paid when I bought her and will eventually be sold to an EU citizen, probably. It's just easier that way, but I could have flagged her in the U.S. without killing the VAT status, if I had wanted to.

Flag status affects safety laws which apply aboard. Again, it is not likely to be a big deal for you.

So if you are an American buying the boat in America, I can't think of any good reason not to Coast Guard-document the boat and fly the old stars & stripes. It will be much easier than setting up a BVI company and so forth, which will not give you any advantages.

[SydneyTim]

One specific issue for Oz citizens is that if you arrive in Oz on a foreign flagged vessel but you are the owner they will slap GST on you the second you arrive even if only passing through with no plan to import.

[idpnd]

Originally Posted by Hanna&Chris

Which of these 3 nationalities would be the best to register your boat under for avoiding taxes and easy cruising in the Carribean and the Mediterrnean?

United States
Ireland
United Kingdom

What taxes to you wish to avoid? You may wish to contact the appropriate lawyer.. The income you buy the boat with has presumably been taxed, so unless there's a luxury goods tax or property tax in your country you would not gain specific advantages from choosing an offshore jurisdiction, unless you were to derive income from the boat through chartering.

Otherwise, a liberal flag may help mitigate the more stringent demands of your home country flag; a lot of French people chose a Belgian flag, for instance, since the equipment and licensing requirements and taxes are much more reasonable..

[Roaring Girl]

The issue re equipment and licensing seems as important as tax. In the EU the preeminent relevant tax issue is VAT (though the 183 residence rule might also have an impact if you're in Spain. But VAT's an upfront decision and there are several different approaches. For info, the Uk's current VAT rate of 15% is I think the lowest is the EU, but VAT rates can and do change.

The equipment issue along with the certs the skipper must have is a different thing. In italy we have seen a lot of boats with UK registration because - and their Italian owners have told us this - the UK requirements are the easiest and cheapest to meet. An Italian flagged boat can be fined for eg out of date flares, insufficient fire-extinguishers, inadequate paperwork. You may not see much enforcement, but if it's you that gets the fine, it will hurt! There is very little UK legislation: if you carry VHF or SSB you must ahve the operators certificate. (If you're over 12m you must comply with elements of SOLAS, eg to display lifesaving signals near the nav table and to have (in some undefined fashion) a passage plan, but those regs apply to us all.) That's it.

So I would check out those requirements alongside any tax implications of the flag of the vessel you purchase and the impact of having that flag on any countries you wish to visit.

[hoppy]

Originally Posted by SydneyTim

One specific issue for Oz citizens is that if you arrive in Oz on a foreign flagged vessel but you are the owner they will slap GST on you the second you arrive even if only passing through with no plan to import.

Not that I am planning to do it, but I wonder what they would do with me if I stopped over on a Swedish registered boat when I have both Aussie and Swedish citizenship and I am not Aussie resident I feel it would lead to a lot of

[hoppy]

Originally Posted by Hanna&Chris

Which of these 3 nationalities would be the best to register your boat under for avoiding taxes and easy cruising in the Carribean and the Mediterrnean?

United States
Ireland
United Kingdom

If you are an EU citizen with a non-EU registered boat, Greece will certainly not be an easy cruising destination.

Noonsite: Greece - Bad News for Non EU yachts commanded by EU citizens