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Old 20-08-2019, 11:20   #1
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Who can legally help with VAT planning?

When a US citizen is purchasing a Croatian boat with French registration and sale under French laws, I found many different comments on who is responsable for VAT.



My question is who would the source be? In other words, if I dont have a buyers broker, who would be educated enough to tell me the facts? Would it be another broker?, a marine attorney (and if so, a US one, Croatian, or French), a surveyor?



I f I was interested in this excerpt:


"to establish or to buy a ready made shelf Ltd company in any EU country. You will be owner of the company as a physical person. Then register this company for VAT. In a such a case VAT doesn't apply for your companie's purchase. You may use EUcountry flag as long you need it before leave the boat home. It will cost you some little money for administrative expenditures with company but on the other hand you save a lot and the boat may stay in EU as long as you need without obligation to leave EU after a certain time"



Who would know the tax implications? Certainly not my tax attorney.
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Old 20-08-2019, 19:33   #2
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Re: Who can legally help with VAT planning?

Quote:
Originally Posted by tanre View Post
When a US citizen is purchasing a Croatian boat with French registration and sale under French laws, I found many different comments on who is responsable for VAT.



My question is who would the source be? In other words, if I dont have a buyers broker, who would be educated enough to tell me the facts? Would it be another broker?, a marine attorney (and if so, a US one, Croatian, or French), a surveyor?



I f I was interested in this excerpt:


"to establish or to buy a ready made shelf Ltd company in any EU country. You will be owner of the company as a physical person. Then register this company for VAT. In a such a case VAT doesn't apply for your companie's purchase. You may use EUcountry flag as long you need it before leave the boat home. It will cost you some little money for administrative expenditures with company but on the other hand you save a lot and the boat may stay in EU as long as you need without obligation to leave EU after a certain time"



Who would know the tax implications? Certainly not my tax attorney.
As far as that quote goes, I'm almost 100% certain it is dangerously incorrect. I asked the poster for details and got no reply, but it's pretty clear in most of Europe that a vehicle VAT exception for a corporation only applies to a vehicle exclusively used for business. A company with no revenue or profits isn't going to be able to justify that the boat you're cruising on is exclusively business use. You can simply ask VAT authorities about that, or read the law yourself. Otherwise you'll want a tax attorney to advise you, not sure why you think some jackass on an anonymous website has the answers but a tax attorney wouldn't. If your doesn't perhaps it's time to find another!
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Old 20-08-2019, 20:51   #3
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Re: Who can legally help with VAT planning?

Take delivery of the boat outside the VAT zone in Montenegro, then no VAT will be due.
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Old 20-08-2019, 20:51   #4
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Re: Who can legally help with VAT planning?

You're the only one responsible in law. Up to you to find someone who will give you the correct advice and won't leave you in trouble later on. You'll want a qualified accountant or tax lawyer who knows this area properly.

And, as stated above, remember to document all personal use of the boat if there is any. The proportion of personal to business use of the boat gives you your liability for that proportion of the VAT claimed. Getting it wrong can lose you the boat. A friend of mine bought a boat very cheap in Portugal: the original purchaser ran a charter company in the eastern Med but had bought this particular boat for himself through this company but not actually chartered it out. On his arrival in Portugal one day the boat was seized due to the VAT paperwork being too flaky, and ended up being auctioned off by the state to pay the bill.

VAT is one of those things you shouldn't mess with unless you know exactly what you're doing.
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Old 21-08-2019, 09:16   #5
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Re: Who can legally help with VAT planning?

Croatian Boat under French flag? Then it's a French yacht. Anyway, VAT is almost same all EU. EU registered yachts must have VAT paid unless owned by a company for business or sailing outside EU waters, like my one.

Rest assured ALL dept. of finance are carefully looking wether you generate income w your investment or not, you have usually a year to proof. No taxable income and it is considered "for own pleasure". Guess what this means.

Sale & lease-back, Malta is unfamous for that, but with all cost involved makes only sense for Superyachts, do not know of a Croatian one.

Once VAT is paid it is valid forever in all EU countries, always the exception: Leave the EU for >3 years, pay again. But if no change in ownership and you proof a goid reason, this is usually excuse enough, but no warranty for that, if your customs guy is communist he might see this differently.

Most countries here you must have a permanent residence to fly a EU flag, or a company, look internet for law-firms in Malta, some had informative pages.
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Old 21-08-2019, 10:46   #6
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Re: Who can legally help with VAT planning?

Check the VAT status of the yacht. If it is French flagged, in Croatian waters then it will almost certainly be VAT PAID. If so then no problem, you don't need to pay it again as long as the vessel remains in EU waters. Even if you subsequently re-register the vessel in the US it will maintain its VAT PAID status.

As long as you do not take the boat out of the EU for more than 3 years it will maintain its status. Leave for more than 3 years then you will be liable again but as a Non EU citizen on a non EU flag you have 18 months temporary import before VAT is liable again. (For EU Citizens even in a Non EU vessel that does not exist and VAT is liable at the point of entry - note citizens not residents).

If for some reason it is not VAT PAID then a)I'd like to know how and b) as a US citizen you can benefit from both the EU Sailaway scheme that gives you a grace period to leave the EU without having to pay VAT and the Temporary Import where you are allowed to keep the boat in the EU VAT free for 18 months (just have to leave the EU for a day to reset that clock).

I looked into all this when our boat was VAT FREE in Croatia before Croatia joined the EU so I hope this helps

Fair winds

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Old 21-08-2019, 10:46   #7
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Re: Who can legally help with VAT planning?

People specializing in importation of goods are called "Customs Brokers". They are specialists, and sitting down with one of them will cost you nothing. The advice you will get will be comprehensive and sound.

You will find them in Yellow Pages and by asking the all-knowing Ms. Google.

Good luck

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Old 22-08-2019, 01:06   #8
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Re: Who can legally help with VAT planning?

First thing you need to know is ...has VAT been paid... Ask to see the vat document...no payment , then two choices. Choose an EU country take boat and pay vat there. Some are.less % than others.
Or. Stay in EU waters the 18 months allowed a non vat paid vessel...sail out, come back for further 18 months.
You do not say if you have seen a VAT certificate ?
Is boat an ex charter boat ? If so even though French flagged it may have remained vat unpaid due to it being used by a Company for charter... They are vat exempt ...
All forum advice is superfluous until you know the vat status.
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