And so it continues... This time: V.A.T.

[TrentePieds]

This seems a reasonably succinct summary of the regulations:

Yacht Vat and RCD

There seems to be a great variability twixt member countries in how they "police" the application of the regulations, and how rigorous they are in doing it. Capricious enforcement is not a European speciality, however. There, like here, protection against that obviously lies in keeping your paperwork ironclad :-)

TrentePieds

[valhalla360]

Originally Posted by med

If you have just bought it, then the value for tax purposes is exactly what you paid for it.

Logically, that is what would be expected but that is not what was reported.

[Barra]

Originally Posted by med

I don't understand what you mean.

But the document issued on deregistration from the French registry is issued by the Customs authority.

The very same people you would pay your VAT to, if you imported a boat into the France.

The nice customs people are putting it in writing and making if official that VAT has been paid. This form also has a date on it which coincides with your purchase date absolutely confirming in a bullet proof manner that no VAT is due by you and that the boat has a current VAT paid status.

You cannot get anything similar of the same status in the UK. HRMC in the UK will never state that VAT has been paid.

An original VAT receipt is not bullet proof proof that VAT is not due again due to the boat having been exported. All it shows is that some boat builder took some money off the original purchaser for VAT. Whether it was actually paid to HMRC or not cannot be verified, proved or confirmed.

That French document is by far the best VAT proof you can have.

Sadly this is not really as clear cut as you say even within one EU country eg our experience with french customs was very different to above. Im not sure what french document you can be referring to actually. We bought a french registered and VAT paid boat. All french customs did was stamp the contract of sale and issue the deristration document. is this what you mean?

They were also very clear that they kept no register of VAT status and that the sale contract was not proof of vat status even though it says "vat payed" and they stamped it. I was told that the document that i needed to prove vat paid status was the original owners invoice.

I then saw this in action when a friends swiss flagged boat was detained until the french invoice could be sourced 3 weeks later.

Go across the border to spain and they do have a vat register and this is the proof they require (not the invoice). Go to italy and who knows???

Gotta love the "union"

[valhalla360]

Originally Posted by captmikecoin

When I looked into paying VAT in Spain about 4 years ago, I asked a specialist (sorry I forget the name, but in Palma, Mallorca) who told me the authorities they deal with look up the current price of the nearest equivalent production boat in their official listing of yacht prices and charge VAT on that. No negotiation. I was unable to get an estimate in advance as it was explained to me that the yacht had to be present in Palma (in this instance) for inspection. Furthermore, once you arrive in the Spanish port of your choice and tell customs you want to pay VAT, you can't leave until you've paid! This is the same process they have for cars which I know from personal experience, values having nothing to do with the marketplace.

I went to Greece where negotiation is or at least used to be possible.

Cheers,

Mike

Thanks for the feedback.

Of course as an American, I could ask what the VAT would be if I didn't want to avail myself of the 18 month window. If they refuse to tell me what the tax would be, I would just stick with the 18month window.

While officials do lots of goofy things, I'm not sure how they could justify holding the boat until VAT is paid in this scenario. Worst case would be they would refuse to tell me what the VAT would be and I would move on.

[med]

Originally Posted by Barra

We bought a french registered and VAT paid boat. All french customs did was stamp the contract of sale and issue the deristration document. is this what you mean?

For crying out loud, the deregistration document is issued by Customs and says "VAT paid" in big friendly bold letters.

There is nothing more cast iron than that.

The original invoice is irrelevant and does not prove that the boat has a current VAT paid status anyway.

A transaction which takes in the EU, where an EU resident individual is selling a boat which is in the EU to some one else, that some else is not liable for any VAT.

This issue is blown out of proportion.

Yes if a boat (VAT paid or not) is exported from the EU, sold and then a different owner imports it, then VAT is due. The number of cases where people have been hassled for VAT when none was due, is extremely low.

Indeed no one on any forum seems to have been in such a situation (although everybody seems to have heard that a certain yacht a few berths down had a customs shake down and got in trouble over VAT).

[Prairie Chicken]

Barra, if you go back to about the first page of this thread, the OP showed a copy of the deregistration form he was talking about. It's not the invoice.

My French isn't up to the translation, but if the form is issued by the French gov't & says VAT paid ... I'd sure consider that gold!

As far as being hassled by officials, we've been boarded three times in Spain but not bothered about VAT. The Aduanas were concerned about how long we, the people, spent in Spain. They didn't seem interested in the boat. On the other hand, we've watched it happen on a boat just down the quay where 5 Aduanas spent many hours on the boat, with us watching. The owner later told us the issue was the proof of VAT paid. In that case, he said his proof was at home in Germany & he was flying back the next day, & would bring the proof back with him--to which the Aduanas told him he would not be going anywhere--they would seize his passport--until he satisfied their inquiries. That was a leased cigarette boat so I have no idea how legit the owner was, but he was definitely in shell-shock after that shake-down, & we were all shocked the Aduanas had (or said they had) the authority to seize his passport.

In another case, Scot friends of ours were boarded & the boarding party were not satisfied with the proof of VAT-paid on the boat. They insisted the owner take his 'proof' to their office in downtown Palma the next morning. This he did, & another friend of ours went with him for translation if necessary. The guy in the office completely accepted the proof, and said the guy on the boat didn't know what he was talking about. Still, if you were the owner who had no Spanish, you can imagine how stressful that Sunday sail was.

[Barra]

Med - Dont get wound up this is just the way of the "union". Im just pointing out that even just within France let alone other EU countries you will get different results from different customs officials. The Deregistration document is just that, not a vat document (even if it says vat paid). I have one of those too but the customs chaps I spoke to were very clear to keep the invoice with the ships papers as this was what they would be looking for on an inspection. Since there was no register that inspection would be random.

I wouldnt want someone to rely on your advice when my actual experience with French customs is different.

PC - Yes its issued by the French government but be careful as that particular document isnt actually confirming VAT status, just that the boat is no longer french registered and can now be registered elsewhere. It may work but its sure not the gold standard - the original invoice is.

And on the enforcement side of it I can confirm first hand, not just rumour, they dont mess around. Apart from the 3 week detainment of a previously registered French boat without the invoice we also saw a newly flagged german boat out of malta get boarded after they tried to make a break for the border predawn leaving a disputed 230,000 euro VAT bill behind. Customs were waiting just outside port in the dark for them on a tip off. Very militaristic operation that one (ie lots of guns) and we sure sighed with relief when we realised the welcoming committee wasnt for us.

[med]

Originally Posted by Barra

Yes its issued by the French government but be careful as that particular document isnt actually confirming VAT status, just that the boat is no longer french registered and can now be registered elsewhere. It may work but its sure not the gold standard - the original invoice is.

Wrong.

It is confirming VAT status. It is written in big letters. It is from Customs themselves - the guys who are responsible for checking up on this stuff. It has their stamp on it.

I repeat again, it is an official document from customs and clearly says simply in unambiguous terms "VAT paid". No ifs or buts or contingent on some other document. It is stamped and dated.

It is solid platinum, not gold plated.

The original invoice does not prove VAT status. It shows at one time the boat might have been VAT paid. It is not guarantee of anything at all as the boat may have been exported and reimported in the meantime, or the VAT may have immediately been reclaimed on delivery.

The document from French customs does however. It is 100% solid proof. The guys who will arrest you if you have not paid VAT give you a certificate which says VAT paid. What can possibly be better?????

The French boat you mention without the invoice, may well have been a company registered boat which was then sold on VAT free for export or some other scam. Believe me, French customs can join up the dots. They have access to very detailed data about yacht movements, registrations etc.

They will not detain a boat or a foreigner, particularly a foreign registered, unless there is proof of fraud.

French customs will almost certainly know where your boat has been and for how long. They keep pretty good look outs along the coast and do check with all the marinas. They are not interested in you or me or our original invoices. They know which boats have been exported and will be watching them closely if they find them in French waters again. I think they also forward information to other authorities. French and Spanish customs seem to work a lot together. Also I suspect with Swiss and UK customs as well.

The same way, French customs do stop cars in France on the autoroute (and other roads some times) and cuts them apart. They cut through petrol tanks, remove tyres, take the coverings of seats etc etc. This is because they have had a tip off and know that the car in question is transporting something illegal (drugs or large quantities of dirty money). It is not something which is going to happen to you or me - so no reason to get nervous when you see them waiting at a "peage" somewhere. They are looking for some one specific. Same kind of things with boats.

They really don't go in for spot checks. This is why more often then not, when you go through customs at the Paris CDG or Orly airports, there is no one there at all - they have already run everyone on the arriving flights through their data base without turning up anything exciting for them.

[Barra]

Originally Posted by med

Wrong.

It is confirming VAT status. It is written in big letters. It is from Customs themselves - the guys who are responsible for checking up on this stuff. It has their stamp on it.

I repeat again, it is an official document from customs and clearly says simply in unambiguous terms "VAT paid". No ifs or buts or contingent on some other document. It is stamped and dated.

It is solid platinum, not gold plated.

The original invoice does not prove VAT status. It shows at one time the boat might have been VAT paid. It is not guarantee of anything at all as the boat may have been exported and reimported in the meantime, or the VAT may have immediately been reclaimed on delivery.

The document from French customs does however. It is 100% solid proof. The guys who will arrest you if you have not paid VAT give you a certificate which says VAT paid. What can possibly be better?????

The French boat you mention without the invoice, may well have been a company registered boat which was then sold on VAT free for export or some other scam. Believe me, French customs can join up the dots. They have access to very detailed data about yacht movements, registrations etc.

They will not detain a boat or a foreigner, particularly a foreign registered, unless there is proof of fraud.

French customs will almost certainly know where your boat has been and for how long. They keep pretty good look outs along the coast and do check with all the marinas. They are not interested in you or me or our original invoices. They know which boats have been exported and will be watching them closely if they find them in French waters again. I think they also forward information to other authorities. French and Spanish customs seem to work a lot together. Also I suspect with Swiss and UK customs as well.

The same way, French customs do stop cars in France on the autoroute (and other roads some times) and cuts them apart. They cut through petrol tanks, remove tyres, take the coverings of seats etc etc. This is because they have had a tip off and know that the car in question is transporting something illegal (drugs or large quantities of dirty money). It is not something which is going to happen to you or me - so no reason to get nervous when you see them waiting at a "peage" somewhere. They are looking for some one specific. Same kind of things with boats.

They really don't go in for spot checks. This is why more often then not, when you go through customs at the Paris CDG or Orly airports, there is no one there at all - they have already run everyone on the arriving flights through their data base without turning up anything exciting for them.

Med you write with such authoritative knowledge but what you say has not been my experience having done almost exactly what the OP is talking about.

Just because customs has stamped something is not attestation that they have confirmed it is correct unless it directly relates to the document concerned. The VAT is simply not something they check at deregistration - why would they? From memory and i could be wrong here the checks concerned contract of sale details, inclusions etc, past and new owners details and for some reason any finance owing. There was no info required supporting VAT status to get the stamp. There is no french registry of vat status of boats.

It may help on a random inspection (and sorry to disagree again but yes they DO happen) but it is far from solid platinum. Yes I do get that invoices are only a snapshot in time and that other aspects of boat history may be needed to be supported if it comes to that but the presentation of the invoice on an inspection is the surest way to circumvent any further investigation.

My friends who were detained were not involved in fraud and as far as they could tell neither was the previous natural person owner BUT they were detained until the onus of proof could be lifted. This took 3 weeks as they had to contact the previous owner and have him provide the invoice.

Guilty till proven innocent Im afraid is the way they can sometimes act and to be comfortable in EU waters for extended stays you do need to be ready to prove your innocence when it comes to customs.

[Dulcesuenos]

Dumb question but if an American were buying a boat over there and leaving the country with it, is vat an issue? I thought no vat proof needed, or is that only in a non eu or vat country?

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[Barra]

VAT is only an issue for a non EU resident if they want to leave their boat inside the EU for longer than the 18 month time limit. In any event its easily reset by a quick trip to a non eu country (but bring back proof you were there!)

[valhalla360]

Originally Posted by Dulcesuenos

Dumb question but if an American were buying a boat over there and leaving the country with it, is vat an issue? I thought no vat proof needed, or is that only in a non eu or vat country?

Sent from my PLT1077G using Cruisers Sailing Forum mobile app

The issue is residency. Though people often relate that to citizenship which applies for most but not all (ie: an american with residency in the EU is essentially treated the same as an EU citizen.)

Assuming you aren't a resident, that effectively gives you 24months. There is an 18 month window but you can extend by 6 months if you are not on the boat. Without residency, you have to be out 3 our of every 6 months, so 24 months is the general rule.

The clock can be reset by leaving the EU for a short period (not clearly defined by the law but a couple days with a reciept showing the boat at a marina or purchasing fuel should do).

If you are just going to buy and then sail away a week later, it's pretty much a non-issue. The one warning I will give is don't plan on having all the paperwork done in a week. The US Coast Guard has been sitting on our paperwork for a few months plus there was time to get the prior owner to deregister it from the british system.

[med]

Originally Posted by Barra

Med you write with such authoritative knowledge but what you say has not been my experience having done almost exactly what the OP is talking about.

Just because customs has stamped something is not attestation that they have confirmed it is correct unless it directly relates to the document concerned. The VAT is simply not something they check at deregistration - why would they? From memory and i could be wrong here the checks concerned contract of sale details, inclusions etc, past and new owners details and for some reason any finance owing. There was no info required supporting VAT status to get the stamp. There is no french registry of vat status of boats.

It may help on a random inspection (and sorry to disagree again but yes they DO happen) but it is far from solid platinum. Yes I do get that invoices are only a snapshot in time and that other aspects of boat history may be needed to be supported if it comes to that but the presentation of the invoice on an inspection is the surest way to circumvent any further investigation.

My friends who were detained were not involved in fraud and as far as they could tell neither was the previous natural person owner BUT they were detained until the onus of proof could be lifted. This took 3 weeks as they had to contact the previous owner and have him provide the invoice.

Guilty till proven innocent Im afraid is the way they can sometimes act and to be comfortable in EU waters for extended stays you do need to be ready to prove your innocence when it comes to customs.

So you are trying to convince us that the French customs will not accept a document they issued saying "VAT paid" as proof that VAT has been paid?

And then you think they are going to accept some old invoice as proof? When it does not prove anything at all?

Come on. Pull the other one.

[leftbrainstuff]

Originally Posted by MonsterJoe

Ok, SO and I are in the process of buying a boat. We're having a bit of back and forth with the broker. And now we're not sure what to make of this.

He said he doesn't have the original receipts for the VAT but since we're going to register the boat in Germany anyway he will provide us with an entry in the french discharge papers.

He gave us a sample of the document (I removed the personal information. It was from a previously sold boat):

Imgur: The most awesome images on the Internet

Anyone knows if this is enough to prove that the VAT has been paid should we ever get stopped by customs etc?

Thanks!

Don't accept bs from the broker. He is responsible for providing the paperwork. (I'm assuming he is representing the seller). If you don't resolve the issue before you sign the papers then it becomes your problem.

We engaged a marine documentation broker when we purchased our Liberty 458 in the US.

She found an expired but still active lien from an old loan on the vessel before we completed the purchase. We then funded an escrow and provided the previous owner with a deadline to fix the paperwork anomoly.

The issue was a bank had been acquired by a another bank and that had been acquired by another bank. The loan had been paid off 15 years earlier. But the original bank never updated their records.

We would never have been able to resolve this issue. Hence the need to incentivize the po to sort it out.

The escrow was 50%. A significant amount of money.

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[SaltyMonkey]

Originally Posted by leftbrainstuff

She found an expired but still active lien from an old loan on the vessel before we completed the purchase. We then funded an escrow and provided the previous owner with a deadline to fix the paperwork anomoly.

Great story leftbrainstuff. Let this be a warning to others and why you should always do this.