Selling a boat in the South Pacific

[Mexico Mike]

Hoping one or two of the Downunder members here might have advice for someone thinking about selling an American flagged vessel to someone in Australia or possibly New Zealand. Boat is presently located in Fiji. Is there such a thing as offshore sale/delivery possible to avoid unpleasant extra payments, so to speak? Is it done? Delivery to anywhere reasonable is of course possible.
Any advice or suggestions appreciated.

Thanks,

Mike

[Pblais]

Is there such a thing as offshore sale/delivery possible to avoid unpleasant extra payments, so to speak?

Sure, but the boat has to come home some place. The fact the transactions takes place some place else does not avoid the issue of duty and import fess any place on the planet unless trade agreements would not have required the fee in the first place. The tax collectors don't care who sells anything but the buyer is stuck with where they end up. The buyer comes home sooner or later and brings the boat along. It all depends on where the boat came from and where it's going to. Where you sell the boat means nothing otherwise they would have stores floating in the ocean.

If you sell a boat, it no longer has a registered title so no one owns it until the buyer registers it some place. You can't register a boat just any place you want else everyone would dodge the tax man.

Mike, you can sell your boat any place someone will buy it but no one beats the taxes. Your buyer is the one on the hook not you. How they view the deal is the important question. So if you can get a good price and you are happy then take the money and deliver a clear bill of sale. The rest is up to the buyer.

[Mexico Mike]

Understood, Paul, of course you're right. There can sometimes be loopholes, however, like when Americans buy boats in Mexico from other Americans, make the escrow happen in the US, avoid Mexican tax and US tax by not taking the vessel home for 90 days, and then only for a brief time to change documents, then leave the US again and never have to pay property tax even. I happen to know it has been done more than once...
Sometimes import duty does get charged, however.

[Pblais]

like when Americans buy boats in Mexico from other Americans, make the escrow happen in the US, avoid Mexican tax and US tax by not taking the vessel home for 90 days,

Even that won't work in 90% of the US states. CA is one of the few and even that loop hole is closing. In the US, taxes are a state issue so it varies quite a bit and then it's only sales taxes (stiff I will agree). If you move around you can beat the sales tax only to a degree for a period of time.

I have friends beating FL taxes going on 8 years now. The boat never has been in the state 90 days - ever. The boat is US documented and the mailing address is in FL. They can't bring the boat to FL or they owe the tax.

The best bet is buy a boat and never touch land long enough to be subject to the tax. Most people can't go that long and do have to come to call home some place some time. You do need a registered title and as a citizen of some place that is where you have to go. Once they know you have it, they come for the taxes. Import duties are a national issue and there is no loop holes that I have ever heard of.

Mike the problem is not yours to shoulder it's your buyer that faces it. You won't pay tax any place you can sell the boat so long as you personally do remain there too long to owe the tax before the sale.

[MarkJ]

Hi Mike,
Every avenure of buying boats form usa to flog in australia has been covered and you should really search for those threads. Its all been asked so many times that the answers now are getting shorter and shorter

GST +5% duty is paid bringing a boat from anywhere (even USA) to Australia when owned by an Australian. You pay it when the boat comes in.

The tax can't be avoided.

The tax only needs to be paid when the boat comes into Australia, so if it never comes to Australia then you wont be taxed, but then you can never sell it in Australia

Originally Posted by Mexico Mike

selling an American flagged vessel to someone in Australia ..... Boat is presently located in Fiji. Is there such a thing as offshore sale/delivery possible to avoid unpleasant extra payments, so to speak?

Mike

[maxlev]

There are alot of yachts for sale in NZ, many from overseas.
But very few buyers, so the marinas become boat for sale yards with liveaboard sellers waiting years to sell, if ever.
Be warned.

[Mexico Mike]

Thanks for responses, did that search and found a few relevant posts, sorry for exhuming a dead subject!
Plan B is to keep going around, plan C is to sail back uphill, so if nobody wants to pay my price plus 15%, c'est la vie. Wife is ready to quit cruising and I'm not, so it will be interesting.
Wondering if Oz is full of "liveaboard boat for sale yards" as well?

[imagine2frolic]

Mike,

I bought my boat in St. Maarten, and did not take delivery for 9 months. I was able to register the boat without paying taxes legally immediatley after purchase. If I had brought the boat back to Ca. within 6 months I think? I would have to pay taxes.

I paid duty tax in Culebra, P.R., but could have avoided that by U.S. Documenting the boat. The tax was 1.5% on the boat.

I just left the Fl DMV, and they will register my boat , and retitle it without owing any taxes at all. Only the registration fees, and title transfer fee will be due.

I bought the boat in Sept. 02, and it did not see American soil for 10 months. There are legal ways to avoid taxes, but the burden of proof is on you as the buyer. Do it legally, and you will have no hassles. Do it illegally, and your life will change forever.

BEST WISHES in your sale of the boat, or the wife continuing on. I understand I have had a boat come between a wife, and a girlfriend. I have to say the boat was there first though. It wasn't something that came along later.

[chris_gee]

It is quite possible to sell to an Australian or NZer in Fiji. They are resposnsible for their tax and duty on return to their country. That might be some time later months or less often years. In NZ they can return briefly without tax. In short it is their problem.
The only difficulty is in viewing. However fares to Fiji are quite cheap and it is often a winter holiday destination.
To make viewing economic and solicit genuine buyers I suggest you internet list see trademe.co.nz with detailed specs photos and an honest appraisal. Several photos of a distant small boat in some bay are no help.
Close ups of major points like the hull will help. List major items like sail age and condition etc and work done, rather than every item. This may be best done in a referral to your own site or blog. Maybe you have. I don't know your boat and it is a bit big for me, but I suggest you are selling to a special sub market with probably a fair amount of knowledge.
Describing cosmetic issues only when as I recently encountered there was severe osmosis, teak leaks, and a need for a new motor just frustrates everyone.
It might work for a broker as bait so he can then push higher priced stuff but you are not in that situation.
I would also add that many boats sit in NZ for a long time. I can think of a number on the market for more than a year but the same applies in the US. On the other hand there is a limited choice of good cruisers, other than in certain clusters. One thing that sticks out here is that the US owner often expects far more than the equivalent asking price in the US even allowing for duty.
Sure you have spent some money in repairs and upgrades but you would not recover all that in the US. My understanding is that the market is weak, and yachtworld prices are substantially overstated. There are price guides and dealers have access to recent sale prices. Put simply a realistic price rather than a hoped for one will sell a good boat fairly quickly and tax won't be an issue but the liability for it will be borne in mind by the buyer as the true price he has to pay. Good luck.

[Mexico Mike]

Appreciate your suggestion of placing the internet ad, Chris; I had already been looking at YachtHub. Also appreciate your observations and candor about setting a selling price. Hopefully the extra work and ad-ons will make her worth a fair price to somebody- we'll just have to see what happens, I guess. I honestly almost hope she doesn't sell, but facing reality has never been my strong suit.
Thanks again.

[cathyoz]

if the boat is what the buyer want , the 10 , or 15 % tax are in my opinion irrelevant
i do agree with Chris gee
a long boring list of equipement is not not usefull, in my case i hate it ..
it is like going to a restaurant with too many choose of plates to be all fresh !!!!!!
who care about flares, jacket, Gps, radio .., or sauce and pan !!
any experience sailor will know that all this electronic is so cheap compare to the price of the boat.
a realist price will sell .
considing that the next owner will spend money anyway to fit the boat" her" or "his ways" , and this will be at least a good 30 % minimun of the price he or she is prepare to pay.

[cathyoz]

there are a market in boat in Australia, but the ones who do not sell are not well maintained, maintenance is more important than listing the details of the " cluter" of the boat.
most people when i ring , have no idea when the rig was change, or age of the sails..they reply "nothing wrong with it "
and i ask again for a date or idea or age??? buit then they dribble in B---S----
or "professional built " means it could have been built under a tarpoline in Humid North Queensland, waiting between raining shower to fiberglass the humid "marine" ply, or the humid Foam..

an anyone could call themself "pro boat builder here is Oz" especialy in the late 80 ..
and i saw so many back yard builder calling themself "pro" that luckely most of the boat in Oz , will just sail up and down the coast, not far for a shelter....

[hellosailor]

In the US there is a great deal of confusion over sales tax, as different from "use tax". Sales tax can only be levied when a SALE is made within the confines of a state or other tax authority. However, most if not all tax authorities also levy "use tax" which applies to goods that are purchased elsewhere, and then brought into that venue. And of course "personal property tax" is something else again, based on what you own in that venue.

Taxes on boats are usually levied when the boat is registered, but in some cases no registration is required, typically if there is no engine on the boat. So it is indeed possible to evade sales and use tax, by having an engineless boat which never needs to be registered, and thus probably will never be stopped by a tax man. But that's still tax evasion (illegal) not tax avoidance (legal).

About the only legal tax avoidance scheme I've heard of, is to physically purchase "the boat" meaning the bare hull "as is" for a low value, and then separately purchase the "personal possessions" and other goods that are not subject to sales/use/transfer taxes, which could include sails, cushions, used electronics, used engine, and so on. There's still a burden of proof and an argument to be had with the tax man--but that's apparently legal to the letter of most laws.

Better to let the buyer concoct their own tax schemes, because they are the one who will have to deal with the consequences, in their own venue.