Originally Posted by Zonker
Who says it's a pleasure craft. It is a asset
owned by the company and the company also pays the taxes
required. And that asset has to be maintained "sometimes".
If this is all so "illegal" and "forbidden" - why are the Caribbeans and these low tax countries in the top ten of ("commercialized-private") vessel and aircraft registrars ?
I bet a marine surveyor
will find some "unlawful" thing on your boat - sry its not personally meant - it's just to illustrate the paper law and what is practiced.
Zonker for god sake go ask an accountant , don't believe me
If you own a super yacht or a an expensive plane, it makes sense to employ am army of accountants to set up structures to wrap up these assets in a company. You'll notice for example that many super yachts are on the charter
circuit, this is to comply with commercially trading rules. They are all built to commercial shipping
standards as well for the single
reason that they have to justify a commercial charter
IN addition , most super yachts do not stay in the EU year round , they make sure they leave. ( theres a complex calculation based on sea miles and time in the Eu etc). Remember over 24Metres you are dealing with a commercial vessel irrespective of its actual use.
No lets leave that exalted area behind and deal with mom and pop, EU tax residents owning a 14M sailboat. There is simply no way you can wrap this in a company and use it as a private vessel and not break either company law or VAT law. Yes you may get away with it but it not legal
I can tomorrow, register a company in Ireland
( all online for 100 euros), I can then apply for a Vat registration
number. Ill pay no corporate tax for the first three years and after that since I will not profits , Ill pay nothing.
Great off I go to france
and I buy my boat Vat free. No one looks any further and I sail off around the Med.
HOWEVER. if I'mm inspected
(a) Benefit in kind, 30% of the value of the asset annually added to my personal income
tax - mega oouch
(b) VAT self supply - in essence the company must pay the VAT and fined immediately as the craft is in fact not being used for the intended commercial reason, ( I don't think visiting countries and ogling girls counts as a commercial trading reason).
(c) because of the depreciation rules, I will be writing off the value against no profits hence generating losses. You will be aware that there are minimum shareholder funds etc position to ensure you are not trading fraudulently to recklessly, ( your auditor will not sign off the accounts),
(d) Since the company has no commercial income
, I will be regarded as not trading, this generates its own issues. (VAT, corporate rules, strike off etc).
Even if I wrap up the company outside the EU, I will fall foul of the "beneficial owner" rules as they apply to VAT exemptions
Please if this was legal
, there would be 1000s of companies flogging you company structures.( for boat purchases) and every broker would have a brochure in his office. The fact is there arnt because its illegal.
Please don't tell me how to suck eggs, I have been involved in sail training and boat purchases in Ireland
, the UK, France
It can't be done legally for small leisure boats. END of STORY