EU citizens - non EU registered but VAT paid boat - Are we crazy?

[jannw]

I'm just going to leave this here:

"A boat previously VAT paid and exported from the EU may also qualify for relief on return if:

x. imported normally within 3 years of its export from the EU
x. imported by the person who exported it from the EU
x. it has undergone no more than running repairs outside the EU that did not increase its value

For more information refer to Notice 236 Customs: Importing returned goods free of duty and tax."

https://www.gov.uk/government/public...nd-from-the-uk

I would be careful about completing a sale of a VAT paid boat outside of the EU, regardless of any advice I had received otherwise.

[CookiesnTequila]

Originally Posted by rivonia

Any yacht bought and sold in the EU which is VAT paid remains VAT paid. Simple. The VAT status is only lost if the sale takes place out of the EU simple.

Not simple - I do not agree! I have had two EU maritime lawyers tell me differently. Once VAT is paid, it stays paid no matter where or how many tmes you sell the boat.

[Derek Lumb]

Regarding VAT status the best way is to look at the UK tax department's (HMRC) guidance on the subject. It is in English and will reflect European law. See section 3.5.

HM Revenue & Customs

Or Google
Sailing your pleasurecraft to and from the United Kingdom HMRC

This confirms that VAT paid status can be lost in some circumstances although, in your case, I think you would need to try quite hard to do so.

I understand that your question wasn't about the VAT per se, simply the additional hassle factor of having it checked. I have never sailed under a non UK flag buy so far I have not seen much evidence enthusiastic checks.I suspect you would get most attention in the UK but they are more likely to be bothered about people or drugs on board than VAT status.

Enjoy your cruising in your new boat.

[CookiesnTequila]

Thank you everyone for your advice - The purpose of this thread was to find people that are cruising the EU on VAT paid, non EU registered boats, and hear what they are finding as they travel.

Originally Posted by jannw

I'm just going to leave this here:

"A boat previously VAT paid and exported from the EU may also qualify for relief on return if:

x. imported normally within 3 years of its export from the EU
x. imported by the person who exported it from the EU
x. it has undergone no more than running repairs outside the EU that did not increase its value

For more information refer to Notice 236 Customs: Importing returned goods free of duty and tax."

https://www.gov.uk/government/public...nd-from-the-uk

I would be careful about completing a sale of a VAT paid boat outside of the EU, regardless of any advice I had received otherwise.

[CookiesnTequila]

You explained this to us in another thread (should a non EU boat cruise the med) a month or so ago, and it gave us a major dose of inspiration as we've been trying to get answers and find our way through this VAT maze! Thank you for that!!

Originally Posted by Prairie Chicken

Cookies, our situation has similarities, and we have considerable experience with our boats in the EU.

We are Canadian, are Canadian residents, and we do not have EU passports. We have owned & sailed Canadian registered and flagged boats in Spain for 21 years. We fly back & forth, and do not exceed the Schengen restrictions.

The VAT was not paid on our 1986 First 375. We were boarded twice by the Spanish Aduanas (Customs). In both cases the Aduanas were concerned about how long we, the people, had been in Spain, and did not raise the question of VAT at all. On the last instance (perhaps 8 years ago), the officers pointed out that we (the people) were only permitted to stay in Spain for a maximum of 6 months. (I can only assume the Aduanas officer did not know or understand Schengen.) In both cases they examined our passports thoroughly, including the stamps of entry & exits from our flights in & out of the EU, and turned us loose with a copy of their inspection report to provide to any other Aduanas officer who should happen to board us in the future, and good wishes.

However, we observed more boardings and more enforcement activity in Spain and decided we needed to pay the VAT on our boat. We were not interested in sailing her to Gib every 18 months to reset the VAT clock. We engaged expert advise in Palma and eventually a value was determined for the VAT due on our boat & we paid it. We sailed our Canadian registered boat for several years with our receipt showing VAT had been paid in Spain. We recently sold that boat to a UK resident who happily took that VAT-paid receipt as part of the ship's documentation.

Two years ago we purchased a Jeanneau 43 DS in Spain. She was German flagged and the broker obtained a deletion certificate. She is now Canadian flagged. We have clearly been advised by all parties we have spoken to that since she was purchased in the EU, by an EU citizen, and was VAT paid, she continues to carry her VAT-paid status.

I do not see you having any problem putting the Maple Leaf on your boat! I see no benefit putting a EU flag on it. The only question seems to have been your purchase actually taking place outside of the EU and if this would affect the VAT-paid status. As you have obtained expert advise on this, twice I believe you said, I would trust that advice (but keep copies of all correspondence should you ever need it).

As Canadians we tend to expect laws and regulations to be clear and enforced in a standard manner. This is not the case in many Med countries, and the individual approaches by EU countries make it even more difficult to assess.

[CookiesnTequila]

Okay - I can't resist the topic creep

I do believe this is the key - "imported by the person that exported it from the EU", means that regardless of what happens, as long as we reflag to an EU country before selling, VAT is preserved. And this is a UK document - each EU country has it's own interpretations of how to govern VAT! Some EU countries do not require residency to register a vessel - just $$!

Don't you just love how countries/governments, in their ever expanding thirst for $$, can take the simplest thing and make it so complicated!?! No wonder so many of them are fiscal basketcases (Canada included!). One of the major reasons why we are about to become nomads...

Originally Posted by jannw

I'm just going to leave this here:

"A boat previously VAT paid and exported from the EU may also qualify for relief on return if:

x. imported normally within 3 years of its export from the EU
x. imported by the person who exported it from the EU
x. it has undergone no more than running repairs outside the EU that did not increase its value

For more information refer to Notice 236 Customs: Importing returned goods free of duty and tax."

https://www.gov.uk/government/public...nd-from-the-uk

I would be careful about completing a sale of a VAT paid boat outside of the EU, regardless of any advice I had received otherwise.

[Dauntlessny]

Originally Posted by CookiesnTequila

Not simple - I do not agree! I have had two EU maritime lawyers tell me differently. Once VAT is paid, it stays paid no matter where or how many times you sell the boat.

While I've gotten great advice on this forum, it's not clear to me why you ask a question when you have already had professionals answer the question who also have a financial liability to you should they be wrong (as long as you have paid them for their professional advice).

Get it in writing from them and have fun with your new boat.

[rivonia]

Originally Posted by Steve Pope

If you really need to have the Canadian flag flying, fly it from the port spreader, this will tell other folk that there are Canadians on board.

Brilliant! well said that man

[valhalla360]

Originally Posted by Dauntlessny

While I've gotten great advice on this forum, it's not clear to me why you ask a question when you have already had professionals answer the question who also have a financial liability to you should they be wrong (as long as you have paid them for their professional advice).

Get it in writing from them and have fun with your new boat.

Agreed, if the paid gun says you are fine and the tax man comes looking, you can point to them and they are on the hook.

If you take our advice and the tax man comes looking, you are on your own.

But make sure the lawyers put it in simple language with no exceptions that could apply and then follow exaclty what they told you was legitimate so they can't claim you did something different and thier advice doesn't apply.

[rivonia]

Originally Posted by CookiesnTequila

Not simple - I do not agree! I have had two EU maritime lawyers tell me differently. Once VAT is paid, it stays paid no matter where or how many tmes you sell the boat.

I would say that you have got two **** lawyers.

Do get them to put it ALL in writing in very simple logistical format. Beacause as sure as eggs are eggs They are so wrong!!

[CookiesnTequila]

I did NOT ask for the advice everyone is feeling compelled to give!! I was simply trying to find out what experiences people are having, that are cruising in the EU on non EU registered, but VAT paid boats, as they check into and out of the EU.

And thank you - we certainly will have fun!!

Originally Posted by Dauntlessny

While I've gotten great advice on this forum, it's not clear to me why you ask a question when you have already had professionals answer the question who also have a financial liability to you should they be wrong (as long as you have paid them for their professional advice).

Get it in writing from them and have fun with your new boat.

[Barra]

Hi

I feel your angst!

We are an Australian flagged boat that is VAT paid. VAT was paid by the previous owner and boat transferred to us in the EU (france). There is so much conflicting well intentioned advice on this forum on this issue for a variety of reasons and it had us very confused. Dave (Goboatingnow) has the best advice so listen to him.

It gets confusing as hell but since you ask here is our real world experience from 3 years in the med -

The VAT status of our boat has been checked only once by french customs when we had work done on the boat. We went to them. They had no problems with our status as VAT paid on production of the previous owners sales invoice showing VAT paid. They were pretty agro at the time too sending a vessel after a 60 foot lagoon that had been sold vat unpaid from a german to brit - 230,000 euro bill for them- the very next day.

NB there are many who mention a VAT paid certificate. In France at least this simply does not exist. As I understand it that is the case elsewhere also. Its a furphy. The proof of VAT status is the original sales invoice of the boat and then transfer documents from that owner to you ideally showing that transfer occurred inside the EU. Your boat is then VAT paid in the eyes of the revenue raisers.

We have NEVER been asked about out VAT status anywhere else in the EU including many trips to customs in France, Italy and Greece in particular. Its just not on their check list for clearing in and out of EU which we have done many times now. Spain may be different we dont know. we spent a month there from France and never bothered to clear in, just like all the EU flagged boats moving between france and spain.

All that said I dont know why you would flag the boat non EU if thats where you plan to sail her and you have the option to do so. It means you can legally avoid clearing in between spain and france unlike us.

Dont sweat it. Many on CF get their knickers in a twist about all the boating regs in Europe such as VAT, competency etc but in reality in the main the officials are pretty relaxed about the whole thing and are often just as confused as everyone else on how to operate clearance procedures.

Now schengen thats a real hassel but you can avoid that one....

[Reiziger]

Originally Posted by Barra

........................NB there are many who mention a VAT paid certificate. In France at least this simply does not exist. As I understand it that is the case elsewhere also. Its a furphy. The proof of VAT status is the original sales invoice of the boat and then transfer documents from that owner to you ideally showing that transfer occurred inside the EU. Your boat is then VAT paid in the eyes of the revenue raisers.................

They do exist, see the attached example of a Dutch VAT Paid Certificate issued by the Dutch Tax Office Customs department.



CeesH

[Barra]

Interesting. explains why even officials get confused then with some EU countries with certificates others without. You can see why a dutch customs officer would want a certificate and a french one the invoice. Confusion is the status quo then.

[Reiziger]

PS. In The Netherlands you need the following documents when buying a (Sail)boat;

#1. VAT certificate issued by the customs or sales receipt on which the VAT is specified;

#2. If the yacht is Land Registry registered: proof of cancellation of the ship or proof of ascription new owner (buyer);

#3. If not visible that the yacht has been registered with the Land Registry; evidence from the Land Registry that the ship is not registered by the Land Registry;

#4. Proof of ownership