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Old 26-05-2015, 06:05   #1
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VAT Explained And Customs Bond

VAT.... The mystery solved. Here is the final answer coming from a customs bond agent responsible for many, many mega yachts. So she has to be right 100% of the time or face HUGE liability issues.

Question asked over and over on this forum:

How long can a non EU non VAT paid boat remain in the VAT zone before the VAT either has to be paid or the boat needs to exit the zone to avoid payment?

Answer:

Total time allowed in use within the VAT zone is 547 days (18 months)

Total time allowed that a boat can be in a customs bond is 24 months

Total time allowance when using a customs bond and part time use is:

18 months (use time) + 24 months (bond time) = 42 months combined before a foreign owned boat would need to exit the VAT zone in order to avoid paying VAT.

The final answer is 42 months maximum.

I strongly encourage anyone concerned about VAT to hire a customs bond agent who's responsible for many mega yachts. It's money well spent.

Ken
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Old 26-05-2015, 06:09   #2
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Re: VAT Explained And Customs Bond

Well!

There you are. Rest easy little non European mermaids and Flippers.......

Time for a coffee.


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Old 26-05-2015, 06:10   #3
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Re: VAT Explained And Customs Bond

You must be on the cusp Kenomac or have you already been "out" and then back again?
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Old 26-05-2015, 06:18   #4
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Re: VAT Explained And Customs Bond

Good info but keep in mind this isn't relevant for many situations and will depend on the vessels country of registration and the owners nationality as well as where the yacht was purchased and if it's new or used. For example buying a used yacht in the EU zone may have a maximum of 6 months VAT exemption as standard. British buyers buying new may also have a maximum of 3 months. The information above is the usual scenario for non EU citizens importing or exporting a yacht but it's worth clarifying for the specific situation intended.
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Old 26-05-2015, 06:22   #5
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Re: VAT Explained And Customs Bond

Here's my cockpit view until I launch on June 10th. I decided to stay in my current digs for two extra weeks to get some minor work done. With the extra time, I don't have to be in a hurry... no pressure. I have an excellent Chandlery within 3km and a Supermarket within 2km... Perfect!

Pammymac arrives with some long time friends on the 12th.
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Old 26-05-2015, 06:29   #6
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Re: VAT Explained And Customs Bond

Quote:
Originally Posted by monte View Post
Good info but keep in mind this isn't relevant for many situations and will depend on the vessels country of registration and the owners nationality as well as where the yacht was purchased and if it's new or used. For example buying a used yacht in the EU zone may have a maximum of 6 months VAT exemption as standard. British buyers buying new may also have a maximum of 3 months. The information above is the usual scenario for non EU citizens importing or exporting a yacht but it's worth clarifying for the specific situation intended.
Monte,

A boat owned by a non EU citizen would just need to leave the VAT zone for just a single day, then the above scenario would apply. UK citizens have their own unique issues when trying to avoid VAT, because the UK is in fact part of the VAT zone. At least past leaders in the Britain had the foresight to retain their own currency.

It's nearly impossible for EU citizens living in a VAT zone to avoid paying the VAT.

But that doesn't stop some from trying.
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Old 26-05-2015, 06:40   #7
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Re: VAT Explained And Customs Bond

Quote:
Originally Posted by monte View Post
Good info but keep in mind this isn't relevant for many situations and will depend on the vessels country of registration and the owners nationality as well as where the yacht was purchased and if it's new or used. For example buying a used yacht in the EU zone may have a maximum of 6 months VAT exemption as standard. British buyers buying new may also have a maximum of 3 months. The information above is the usual scenario for non EU citizens importing or exporting a yacht but it's worth clarifying for the specific situation intended.
Country of registration is irrelevant., except that it may give a hint of true country of residence of the owner.

Citizenship of owner is also irrelevant; what matters if whether the owner is "established" in the EU VAT territory.
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Old 26-05-2015, 11:08   #8
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Re: VAT Explained And Customs Bond

While we are here, I think I'll add what I've discovered:

There is a way for established EU residents (also open to non-EU citizens) to pay a relatively lower VAT by registering their boat in Holland where it is 21%.

And good news for us who reside in the old world and want to bring our gal over from afar:

it is now possible for established EU citizens to import a boat into Europe without going through the whole certificate of conformity bit (which, since the EU was established, became impossible to obtain for an old boat - like-my-to-be-gal who will be about 30-some years old).

Here's the link: Our registration products | Register your yacht under the*Dutch*flag.

When I actually get my gal and go through the process, I'll come back to give feedback.
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Old 27-05-2015, 05:47   #9
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Re: VAT Explained And Customs Bond

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Originally Posted by wolfgal View Post
While we are here, I think I'll add what I've discovered:

There is a way for established EU residents (also open to non-EU citizens) to pay a relatively lower VAT by registering their boat in Holland where it is 21%.

And good news for us who reside in the old world and want to bring our gal over from afar:

it is now possible for established EU citizens to import a boat into Europe without going through the whole certificate of conformity bit (which, since the EU was established, became impossible to obtain for an old boat - like-my-to-be-gal who will be about 30-some years old).

Here's the link: Our registration products | Register your yacht under the*Dutch*flag.

When I actually get my gal and go through the process, I'll come back to give feedback.
21% is not attractive. The UK is 20% and has a super simple small ship register. Luxembourg is the lowest at 17%. I believe the best may be Malta at 18%, especially as they will agree favourable base values.
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Old 27-05-2015, 05:53   #10
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Re: VAT Explained And Customs Bond

21% is not attractive. The UK is 20% and has a super simple small ship register. Luxembourg is the lowest at 17%. I believe the best may be Malta at 18%, especially as they will agree favourable base values.


Hi. Yes, yes, I agree that 21% is attractive, that is unless you are trying to import a boat that doesn't qualify for the Certificate of Conformity, which is required otherwise.
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Old 27-05-2015, 12:50   #11
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Re: VAT Explained And Customs Bond

Quote:
Originally Posted by Kenomac View Post
Monte,

A boat owned by a non EU citizen would just need to leave the VAT zone for just a single day, then the above scenario would apply. UK citizens have their own unique issues when trying to avoid VAT, because the UK is in fact part of the VAT zone. At least past leaders in the Britain had the foresight to retain their own currency.

It's nearly impossible for EU citizens living in a VAT zone to avoid paying the VAT.

But that doesn't stop some from trying.
Is there not some rule along the lines that time spent in a marina over the winter is the same as the bond scenario - i.e. you have to leave the country and your yacht must be under contract in a marina, and this time will be added to the 18 months?
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Old 27-05-2015, 12:57   #12
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Re: VAT Explained And Customs Bond

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Is there not some rule along the lines that time spent in a marina over the winter is the same as the bond scenario - i.e. you have to leave the country and your yacht must be under contract in a marina, and this time will be added to the 18 months?
No. The boat needs to be placed in a customs bond and the owner needs to leave... to be in a proper customs bond. Properly sealed up by government customs agents, and money spent for the proper paperwork and fees. It's not cheap... usually around 300 euros to go into bond and 300 euros to release the bond.

Just having a Marina contract means nada.
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