How to Avoid Australian GST as US Citizen Buying Boat in the US and Moving to AUS?

[atoll]

twin helms! been around for years in the yachting sector!

[Wanderlust]

Originally Posted by scubascooter

Sometimes the information can be interpreted in different ways this is why I suggested its best to call customs directly and get the info straight from the horses mouth

I agree although would be hesitant on relying on telephone advice. But what you pasted does suggest it is actual costs rather than a theoretical commercial calculation.

For the record, here is the link for that document you referenced

importing a yacht

However, that document is dated 2005. There is a more recent factsheet dated April 2011.

http://www.customs.gov.au/webdata/re...ril2011WEB.pdf

Surprisingly, it says:

"The Customs value does not include freight and insurance costs in transporting the goods from the ‘place of export’ to Australia."

I wonder if that could be interpreted to mean those self delivery costs do not apply any more.

And in that factsheet it defines the place of export for a vessel you sail yourself:

"the place, or last place, from which self-transported goods departed for Australia"

So it seems to be a potential minefield and one assessor may well interpret differently from another, let alone the telephone answer you get.

And for those suggestions on reading close to 1,000 posts in that other thread, try looking around post 700+ for some calculations and others' experiences.

http://www.cruisersforum.com/forums/...a-3346-48.html

[justwaiting]

Originally Posted by Wanderlust

I agree although would be hesitant on relying on telephone advice. But what you pasted does suggest it is actual costs rather than a theoretical commercial calculation.

For the record, here is the link for that document you referenced

importing a yacht

However, that document is dated 2005. There is a more recent factsheet dated April 2011.

http://www.customs.gov.au/webdata/re...ril2011WEB.pdf

Surprisingly, it says:

"The Customs value does not include freight and insurance costs in transporting the goods from the ‘place of export’ to Australia."

I wonder if that could be interpreted to mean those self delivery costs do not apply any more.

And in that factsheet it defines the place of export for a vessel you sail yourself:

"the place, or last place, from which self-transported goods departed for Australia"

So it seems to be a potential minefield and one assessor may well interpret differently from another, let alone the telephone answer you get.

And for those suggestions on reading close to 1,000 posts in that other thread, try looking around post 700+ for some calculations and others' experiences.

http://www.cruisersforum.com/forums/...a-3346-48.html

My understanding of the situation is this:


That any yacht that is brought into Australia by an Australian, or any yacht brought in by any other person except where it can be demonstrated that it is a yacht in transit will be subject to an import tax (except where that yacht was manufactured in a place with a free trade agreement with Australia). Further more that all "imported yachts" will be subject to a Goods and services tax levied at the standard rate (10%) of the import value.


That yachts do not qualify as personal possessions for an Australian or migrant and therefore there are no exemptions available to the liability to pay import tax (where applicable) or GST.


That the value of the yacht will be the purchase price unless situations occur where:

• it is not realistic (eg lack of documentation, extended time between purchase and "importation")
• there have been significant upgrades to the yacht that impact of the resale value of the yacht
• the purchase of the yacht was from a family member (to exclude the potential for a family member buying a yacht and reselling it to the importer at a reduced price for the purpose of avoiding tax in Australia

In such cases Customs can require that the yacht be valued in Australia at Australian values, but that value will be adjusted (down) to reflect the expenses of importing the yacht. It should not be the right of customs to tax services outside Australia and doing so may well breach Australia's obligation with trade agreements with the US.


If i was importing a yacht and customs required an Australian value and did not take the above factors into consideration i would'

• seek an internal review from customs
• appeal the decision to the appropriate tribunal (all administrative decision in Australia have a review process that is available to citizens and non citizens -

don't believe me, lol, that's why (apart from political considerations which we are not allowed to discuss here) Australia tries to "process" "boat people" "offshore".


BTW Tax avoidance in Australia is illegal, tax minimization is lawful

[VirtualVagabond]

We are currently Aussies in California looking at boats with the plan to buy one as a permanent liveaboard home and sail back to Aus and beyond. We're also looking at boats in Europe. Sailing back to Aus in 12 months from there is a race not a sail.

I tried to get it all from the horse's mouth before we left, but seem to have got through to the other end. The guy didn't know what he was talking about and gave me a long story about the bill of sale price + costs being the basis for duty and gst calcs within 12 months of purchase date, and customs needing a valuation from a 'certified' surveyor if over 12 months. We could pick the surveyor as long as he was registered/certified etc.

I was subsequently talking by phone to another member here, whose opinion on all things sailing I respect enormously, and he said "thats BS. The guy's an idiot. Speak to a broker I know who does valuations for customs...". Which I did.
His comments were that Surveyors know boats not markets, and that the Aussie used boat market is eventually collapsing too. In fact so is the new boat market. People who spent $250,000 on a new boat with him last year could now buy the same boat new in 2012 for $40,000 less.
Sucks to be a 2011 new boat buyer!

He also told me I had no need to rush back in 12 months because used prices will continue to come down there for a while yet.
If your boat is a Production boat with a strong presence there, Bene, Bavaria, Jeneau, Hanse etc they would obviously use recent comparative sales.
If the boat is older and relatively rare there, Irwin, Seacraft, Vagabond, Formosa etc They would still look at the bill of sale price, and then value it DOWN because of there being virtually no market for it in Aus.
His advice, don't break your neck to get back in 12 months and just enjoy the trip.

Also, I think if the OP here is an Aussie citizen returning, even after 4 years, he is going to get hit for GST the moment he hits Australia. The 12 month cruising permit is for visitors, not Aussie citizens.

Vic

[savoir]

An Australian citizen can do a 12 month temporary import. You have to pay a bond.

http://corrigan.austlii.edu.au/au/le...1124/s162.html

[hoppy]

Originally Posted by VirtualVagabond

Also, I think if the OP here is an Aussie citizen returning, even after 4 years, he is going to get hit for GST the moment he hits Australia.

After 14 years and counting I'm going to get hit.

I'm just waiting for the government to decide in their infinite wisdom that they will tax returning Aussies on everything they return with

[VirtualVagabond]

Originally Posted by savoir

An Australian citizen can do a 12 month temporary import. You have to pay a bond.

http://corrigan.austlii.edu.au/au/le...1124/s162.html

That's really interesting, and I haven't seen it come up on any of the earlier threads on this subject.

Do you know if anyone has gone down this road with a boat successfully?

The reason I ask is that government left hand and right hand often don't speak.

For example, gst doesn't apply to your primary residence, and relocatable homes are specifically included as exempt if it's your home.
I had an ATO guy agree that if you don't own a land based home, a boat you live on permanently should qualify for an exemption.
However Customs collects the GST on behalf of the ATO, and they haven't been told there are any exemptions, so they collect or impound.

You could probably get a ruling, but the chances are you would need to get some legal help and be prepared for a long wait and possibly costs that hardly make it worth it for the average Joe.

[savoir]

Can't help. It could be a good idea if you want to live on the boat while you sell your house.

[Ontos45]

Originally Posted by VirtualVagabond

That's really interesting, and I haven't seen it come up on any of the earlier threads on this subject.

Do you know if anyone has gone down this road with a boat successfully?

The reason I ask is that government left hand and right hand often don't speak.

For example, gst doesn't apply to your primary residence, and relocatable homes are specifically included as exempt if it's your home.
I had an ATO guy agree that if you don't own a land based home, a boat you live on permanently should qualify for an exemption.
However Customs collects the GST on behalf of the ATO, and they haven't been told there are any exemptions, so they collect or impound.

You could probably get a ruling, but the chances are you would need to get some legal help and be prepared for a long wait and possibly costs that hardly make it worth it for the average Joe.

Just a point.
Australian Social Security (Centrelink), a Federal Department, classifies for the payment of "rent assistance" a home as: site fees for a caravan, tent, mobile or other structure and mooring fees for a vessel.
A vessel is also classed as a home for the purposes of assessing finances.
Sue and I now receive rent assistance while living in a caravan (our home) whilst looking for our boat. We are pensioners but I believe this applies t low income earners as well.
So, according to a Federal Department, vessels are classified as a home according to the act.

Peter and Sue

[Ontos45]

Just another point, if you want to import a dog or cat into Oz on your vessel try this link:
Bringing Cats and Dogs (and other pets) to Australia - Department of Agriculture, Fisheries and Forestry

This also applies to Ozzie's cruising off Australia. Sue and I want to have our dog live aboard and cruise with us but that severally limits where we can go, but, the dog is part of our family.
Peter and Sue

[justwaiting]

Originally Posted by VirtualVagabond

That's really interesting, and I haven't seen it come up on any of the earlier threads on this subject.

Do you know if anyone has gone down this road with a boat successfully?

The reason I ask is that government left hand and right hand often don't speak.

For example, gst doesn't apply to your primary residence, and relocatable homes are specifically included as exempt if it's your home.
I had an ATO guy agree that if you don't own a land based home, a boat you live on permanently should qualify for an exemption.
However Customs collects the GST on behalf of the ATO, and they haven't been told there are any exemptions, so they collect or impound.

You could probably get a ruling, but the chances are you would need to get some legal help and be prepared for a long wait and possibly costs that hardly make it worth it for the average Joe.

With respect,

Buying and existing private residential selling homes built prior to the introduction of the GST did not atract GST. Homes built after the introduction of the GST did, and still does atract GST when then are first sold, after that they are treated as GST paid. The inequities created were adressed by the first home buyers grants and incentive schemes to purchase newly constructed homes under a given price by first home buyer.

If you bring a boat into Australia the government (as all government do) wants their pound of flesh - GST. An imported boat is "new" to Australia and no residential exemptions exist as far as i know. I would LOVE to be wrong.

As for the "ATO guy" advice "should" may mean ethicaly, you need the word "will" or "shall" for it to have any meaning. In fact you can ask the ATO for an offical ruleing,

[VirtualVagabond]

Originally Posted by justwaiting

As for the "ATO guy" advice "should" may mean ethicaly, you need the word "will" or "shall" for it to have any meaning. In fact you can ask the ATO for an offical ruleing,

I agree totally. I'm just telling it as it happened. He didn't give "will" or "shall". But it wouldn't matter if he did. Customs would still collect or impound. It should be different if you had an official ruling, but that can be a hard thing to get.
When I was in business we tried to get a ruling for an investment plan similar to superannuation, using existing, approved investment funds but with trust structures. It was in the 1990s. We spent $25,000 with a big legal firm (Freehills), and we're still waiting. I've since retired!

[olaf hart]

If you think paying an extra 10% of the US purchase price is a big deal, you probably havn't looked at all the other costs of keeping and maintaining a boat in Oz.

[justwaiting]

may be of interest to some one - from an ATO site

　
FREQUENTLY ASKED QUESTIONS ON TEMPORARY IMPORTATION OF GOODS
1. I am an Australian citizen who lives and works in another country and I wish to temporarily import my yacht, is this possible?
While you maintain your residency overseas and can substantiate that (working visa, passport, utility bills, rental agreements etc) you are entitled to make a temporary importation for a period of up to 12 months under section 162 of the Customs Act 1901 (the Act) providing a security (cash bond or bankers letter of indemnity) or an undertaking to Australian Customs and Border Protection Service (Customs and Border Protection) as determined by Customs.
The security or undertaking will cover the amount of duty and taxes that would be applicable if the yacht had been imported. S.162 of the Act requires that a security or undertaking be lodged before temporary import goods can be cleared for home consumption.
You must lodge an approved form 46 "Application For Permission To Take Delivery Of Goods Upon Giving A Security Or Undertaking The Payment of Duty, GST and LCT". This form is available at Customs home page
Copies of invoices, packing lists, bill of lading, quarantine certificates and other documents that identify eligibility should be lodged with the application on arrival in Australia at a Customs and Border Protection counter.

NOTE: You may also be entitled to apply for a control permit.

http://www.customs.gov.au/webdata/re...ports-faqs.pdf

[David_Old_Jersey]

Am not terribly sure if OP "moving" to Australia means he is emmigrating (whether or not swapping or adding a passport) or simply will be living in OZ for an extended period.

I personally don't have a problem with any country setting a limit on how long someone can be called a "visitor" before becoming a resident, and being taxed accordingly (all that nice stuff that is the reason people want to stay in a country does have to be paid for, including the paying to make sure nobody f#cks the place up).

To my mind, 1 year as a Foreigner is a decent time for a "visitor" (i.e. someone who will be going Foxtrot Oscar - and not simply seeking the free ride they cannot get at "home").....after that you get to pay into the pot - just like a local. Suck it up or FO!

Apart from the locals, everyone else gets to decide at the door whether the cost of admission is worth it - before writing any cheques.....Oz, USA, EU or Timbucktoo.