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Old 09-10-2019, 10:29   #16
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Re: Sailing With paying guests?

I took out over 300 week-long legitimate charters and many shorter ones. I had one disaster and two generally bad ones. In retrospect they were my fault. There were a couple of people who made significant contributions. That's not a bad percentage although even one bad experience like that is something you remember and regret forever.

One person can spoil everything but generally everyone has a great time. I have noted that people are normally on their best behavior, with some exceptions, of course.

It seems that you are describing something different. It seems you are thinking about sailing with friends and splitting the cost (including amortized maintenance costs). In that case insurance should cover it, I would think.

Crossing the line would not be a good idea. I would stay away from advertising or written contracts but friends sail together, all over the world, all the time.

Really depends on how much "your friends" are paying you.

You might also look into "Demise" charters.

My insurance did not increase that much when I specified a boat for commercial charter which is something you might look into.
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Old 09-10-2019, 10:39   #17
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Re: Sailing With paying guests?

This is US specific, but the USCG definition of a “consideration” (which defines when the voyage becomes commercial and you need license, insurance etc)

“ Consideration: means an economic benefit, induce- ment, right, or profit, including pecuniary payment accruing to an individual, person, or entity but not including a voluntary sharing of the actual expenses of the voyage by monetary contribution or donation of food, fuel, beverage, or other supplies.”

So essentially you can be non- commercial with crew voluntary contribute to a portion of actual costs of consumable supplies, but not to asset depreciation/interest, fixed costs, overhead or profit.
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Old 09-10-2019, 11:03   #18
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Re: Sailing With paying guests?

The specifics with aviation, guests can pay no more than half and the pilot must be already going to that destination. Meaning the pilot is benefiting from the flight and the passenger is going there also.
We have had problems with donation flights (like big brother/big sister) and honor flights. Basically the pilot must pay the entire fuel bill. The non-profit organization can't pay any of the fuel bill.
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Old 09-10-2019, 11:37   #19
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Re: Sailing With paying guests?

I was under the impression that a captain must have a license to charter and without one cannot have the guests buy lunch.

One would probably not have a problem until one of the guests has a problem.
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Old 09-10-2019, 11:49   #20
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Re: Sailing With paying guests?

Quote:
Originally Posted by Breaking Waves View Post
This is US specific, but the USCG definition of a “consideration” (which defines when the voyage becomes commercial and you need license, insurance etc)

“ Consideration: means an economic benefit, induce- ment, right, or profit, including pecuniary payment accruing to an individual, person, or entity but not including a voluntary sharing of the actual expenses of the voyage by monetary contribution or donation of food, fuel, beverage, or other supplies.”

So essentially you can be non- commercial with crew voluntary contribute to a portion of actual costs of consumable supplies, but not to asset depreciation/interest, fixed costs, overhead or profit.
I thought this "opinion" (it's not law but USCG interpretation) was that the voluntary sharing was for friends and family.

Which leaves a huge gray area if you "meet" someone via a couple of emails specifically spurred by the desire to find someone to voluntarily share costs...then you are collecting a couple thousand for their "voluntary" share of expenses. If the poo hits the fan (say someone gets hurt on your boat), I suspect, your new found friends won't care if they let on you for running an under the table charter business.
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Old 09-10-2019, 12:21   #21
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Re: Sailing With paying guests?

It is the country you are chartering in I. E coastal waters that you must pay attention to thier rules for coding a vessel for charter or in international waters the flag registration country is the charter code insurance for liability is a must as if a problem arises I. E a person loses a limb etc or death due to non coding and poor seamanship you will be liable for compensation and in some cases manslaughter, those that do it in less developed places get away with it but remember a lot of the Caribbean is colonial law of Europe. The law is grey for expenses only charter and can be interpreted as a paying customer all countries will have different requirements. People are doing it all the time and I suspect most are not insured for charter and do not have enough liability cover remember if you go on one of these boats and get injured and you lose your job and lively hood through neglect of the boat or skipper and they do not have potentially millions of liability cover your screwed. Life is a risk but I dam would want to check out a boat and there skipper and their insurance before I get on .... For those wishing to understand this more the cheeki rafkii case in the UK were the owners were tried for manslaughter for poor maintenance on a boat were all hands died on an Atlantic crossing
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Old 09-10-2019, 12:24   #22
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Re: Sailing With paying guests?

Quote:
Originally Posted by valhalla360 View Post
I thought this "opinion" (it's not law but USCG interpretation) was that the voluntary sharing was for friends and family.

Which leaves a huge gray area if you "meet" someone via a couple of emails specifically spurred by the desire to find someone to voluntarily share costs...then you are collecting a couple thousand for their "voluntary" share of expenses. If the poo hits the fan (say someone gets hurt on your boat), I suspect, your new found friends won't care if they let on you for running an under the table charter business.
I’m not aware of any “friends and family” constraint. The tricky bit is that it must be voluntary - it cannot be an advance requirement to be carried that they share the cost.

And yes, obviously you could get screwed if they asserted it was in fact not voluntary, but a requirement to be carried.

I had a bit of interaction with lawyers and their explanations of these laws when doing a bit of consulting with a company which wanted to do “Airbnb for boats” - but I am certainly no expert on them.
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Old 09-10-2019, 12:29   #23
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Re: Sailing With paying guests?

A lot of US-centric answers. It doesn't matter how it works in the US or what the USCG requires. Requirements are dictated by where the charter is being operated. The OP signature reads Germany.

At this point it's academic until the OP clarifies where he intends on operating the charter.
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Old 09-10-2019, 12:40   #24
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Re: Sailing With paying guests?

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A lot of US-centric answers. It doesn't matter how it works in the US or what the USCG requires. Requirements are dictated by where the charter is being operated. The OP signature reads Germany.

At this point it's academic until the OP clarifies where he intends on operating the charter.
I think that's kinda the point. How many jurisdictions do you pass through during a Caribbean trip? What are the chances an amateur is gonna know about section A.2.(d).ii of random country code that requires some obscure requirement with boat seizure a consequence of non-compliance?
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Old 09-10-2019, 12:45   #25
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Re: Sailing With paying guests?

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I think that's kinda the point.
So all are discussed? That's crazy. The OP has a specific question that requires more information to answer. Deeming the thread a compendium for all regulations globally is just crazy.
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Old 09-10-2019, 12:54   #26
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Re: Sailing With paying guests?

Quote:
Originally Posted by Shrew View Post
A lot of US-centric answers. It doesn't matter how it works in the US or what the USCG requires. Requirements are dictated by where the charter is being operated. The OP signature reads Germany.

At this point it's academic until the OP clarifies where he intends on operating the charter.
And isn't that unlikely to be in the USA?
When we were sailing on the US east coast I commented more than once on how few charter boats there seemed to be around; Chesapeake Bay and Long Island Sound in particular looked 'likely' spots for a running a fleet of Sunsail or Moorings' yachts. It was explained that the market was limited by the requirement for that a 'charter' boat in US waters, it had to be US flagged and that as only a US citizen could skipper a US-flagged yacht, foreigners couldn't charter without their employing a Commercial US Captain.
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Old 09-10-2019, 13:03   #27
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Re: Sailing With paying guests?

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Originally Posted by bobnlesley View Post
And isn't that unlikely to be in the USA?
When we were sailing on the US east coast I commented more than once on how few charter boats there seemed to be around; Chesapeake Bay and Long Island Sound in particular looked 'likely' spots for a running a fleet of Sunsail or Moorings' yachts. It was explained that the market was limited by the requirement for that a 'charter' boat in US waters, it had to be US flagged and that as only a US citizen could skipper a US-flagged yacht, foreigners couldn't charter without their employing a Commercial US Captain.
Not many boats from outside the US go to the US with the points you have raised , it is one of the most burecratic countries in regards to sailing and visas in the world and the Coastguard has enourmous powers over vessels in their territorial waters.
All countries have their own rules and most charters happen in the Med or Indies .
Even in the EU all nation states have their diffrent rules and do not comply with each other so sailing through French waters then portugese then Spanish to enter the med you will have 3 countries diffrent rules and you will be expected to comply
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Old 09-10-2019, 14:46   #28
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Re: Sailing With paying guests?

In some places one can do it--but in most western countries the vessel must meet survey standards, the insurances are really expensive, and one is liable for taxes, and sometimes provisional taxes if one survives a year having earned some kind of income above expenses.

It is the sort of situation that gives rise to alternative ways of transferring some cash--such as a payment for services of an entirely different nature rendered on shore. Since guests aboard for their and the owners pleasure are usually covered by normal insurance and they can take their own risks in coming aboard any leaky scow or A1 at Lloyds luxury vessel.

In other words--forget about the whole idea unless you have a big vessel and a lot of guests, and where ever you are, do it by the book. Some friends of mine ran a floating mobile restaurant which used to take diners for a trip in calm waters on a river--and the insurances were very costly.
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Old 09-10-2019, 15:01   #29
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Re: Sailing With paying guests?

All I'm saying is, if the OP intends on chartering in Germany, then discussing charter boat/captain requirements for the US is irrelevant. If he intends on the Caribbean, then which islands?
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Old 09-10-2019, 16:36   #30
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Re: Sailing With paying guests?

Three further observations:

1) Here in Canada, "tips", (post-hoc compensation) is Reportable Income for Taxation Purposes. I should be VERY surprised, given the nature of international Tax Treaties, if it is not so also in the US and in Germany.

2) What in days of yore made it worthwhile to put your toy in charter was the "artificial expense" called Capital Cost Allowance ("Abschreibung" for the Germans among us). That loophole has now been closed, unless the vessel is TRULY in charter. To be your own Charter Agent is antithetical to convincing the authorities that the vessel is truly in charter. ACTUAL depreciation,(REAL wear and tear as distinct from the artificial CCA) is reflected in the accounting for the enterprise as Repair and Maintenance Costs. These costs tend to eliminate any Net Income from a single vessel enterprise, or even render the NI negative when accounted for on a Cash Basis. Even IF there were a positive Net Income from such an endeavour, that increment of income would be MARGINAL Income with all the consequences of that.

3) A further complication is that if you use a vessel owned by yourself (or a corporation of which you are a director or for some other reason are not "at Arm's Length") you must declare as Revenue for Taxation Purposes the IMPUTED Revenue for the number of days in a year that you, yourself, use it.

Shifting our gaze away from the revenooers' perspective, the sundry Government Agencies responsible for public safety and for the safe conduct of maritime activities that are mandated under the various nations' Shipping Acts have a good deal to say about the required substance of the vessel. Here in Canada the Hull Construction Regulations to the Canada Shipping Act obtain. Again the sundry nations' Acts and Regulations tend to be reflections of each other.

All in all, unless you are a tax accountant or a dedicated risk-taker (read "gambler"), pretending that your toy is a Capital Asset is a thoroughly daft idea.

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