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Old 09-10-2019, 04:15   #1
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Sailing With paying guests?

Does anyone have experience of sailing With paying guests?
2 or 4?

Is it cool or a Desaster... Or better... What is it most often?
How much comfort do people require?
Do all go for maximum or Are there more adventurous charter guests?
What about insurance and paperworks?
What about Skipper licences?

Would appreciate some input.
When i Was sailing on commercial and Private charter boats it was always a good time..
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Old 09-10-2019, 04:44   #2
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Re: Sailing With paying guests?

It's called chartering, and can be pleasant, or not, is seldom profitable, and like most business', generally requires numerous permits, licenses, and etc.
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Old 09-10-2019, 04:55   #3
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Re: Sailing With paying guests?

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Originally Posted by Ibetitsthisway View Post
What about insurance and paperworks?
What about Skipper licences?
Assuming you want to operate legally and in the US:

1. Will need a USCG OUPV license (Operator Uninspected Passenger Vessel - commonly called 6-pack) at a minimum to accept paying guests. Requires sitting for an extensive exam and documenting 360-days of vessel operation.

2. Insurance. I can tell you it's expensive. I used to use my trawler as a training platform for 1-2 day close quarter maneuvers and insurance ate-up over half my revenues. There are specialized marine insurance agents who can assist.

3. Market for 'adventure' sailors. Check out John and Amanda Neal. They have been doing cruising legs as charters for 25+ years. The last 20 years or so has been on a Halberg Rassey 47, but before that, John had a much smaller boat. Definitely possible, though could take a while to build-up the business. I can tell you its not the type of work suited to many people - you have to have a smiley 'game face' every day.

Good luck!

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Old 09-10-2019, 04:59   #4
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Re: Sailing With paying guests?

@ gordmay


thanks a lot for this terrific insight, man!


I am not speaking about chartering as a business, but as a win/win for private (world) cruisers, by meeting new people on a sometimes lonely trip and getting payed a few bucks - paying for the monthly diesel cost and making it chaeper for the guests than commercial charter.
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Old 09-10-2019, 05:20   #5
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Re: Sailing With paying guests?

Quote:
Originally Posted by Ibetitsthisway View Post
@ gordmay


thanks a lot for this terrific insight, man!


I am not speaking about chartering as a business, but as a win/win for private (world) cruisers, by meeting new people on a sometimes lonely trip and getting payed a few bucks - paying for the monthly diesel cost and making it chaeper for the guests than commercial charter.
It's important to understand that while you might not think of it as "chartering as a business", your insurance company and the folks who require all the permits will in most cases consider any paying guest to be chartering and you'll have to meet the same requirements as someone who does it regularly as a business. None of the U.S. laws at least have an "occasional" exception to them. Given that those requirements are a large cost, both monetary and time, and high risk if you don't know exactly what you need to do to meet those requirements and might inadvertently miss some, it's generally not worth the few bucks you get.
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Old 09-10-2019, 05:41   #6
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Re: Sailing With paying guests?

Quote:
Originally Posted by Ibetitsthisway View Post
I am not speaking about chartering as a business, but as a win/win for private (world) cruisers, by meeting new people on a sometimes lonely trip and getting payed a few bucks - paying for the monthly diesel cost and making it chaeper for the guests than commercial charter.
Really depends on what you are trying to achieve. If purely some companionship and cost-sharing, not a problem. But if more of an ongoing arrangement underpinned by a commercial interest (advertising, online posts, etc.), you are at-risk. Spinning it is pretty transparent: Craigslist is full of advertisements for 'escorts' who seek 'donations.'

That said, many people operate in the shadows. There will be no issue until something goes wrong or a disgruntled 'cruiser' complains. Just depends on your tolerance for risk and how much you have to lose.
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Old 09-10-2019, 05:53   #7
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Re: Sailing With paying guests?

What if you expect the guest to pay for fuel or similar instead of paying you? This way youreceive no payment but you are out less money? Thx-Ace
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Old 09-10-2019, 06:12   #8
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Re: Sailing With paying guests?

Splitting costs is allowed to a point in the US. Is the OP from Germany, and doing this over there? It's a big world with lots of different laws.
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Old 09-10-2019, 07:38   #9
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Re: Sailing With paying guests?

Yes every jurisdiction has different rules and laws.

The extent they are actively enforced varies even more.

The nicest cruising grounds, the more arbitrary, and your boat can be confiscated by the uncle of some guy feels you are competing unfairly.

More practically, you better be judgment-proof legally if something happens, insurance won't cover when it comes out you are operating illegally.
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Old 09-10-2019, 08:55   #10
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Re: Sailing With paying guests?

Get payment in beer
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Old 09-10-2019, 09:13   #11
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Re: Sailing With paying guests?

My understanding of the US law is that any payment, whether cash, or buying fuel, or any other boat related expenses, technically becomes a charter. With it comes the compliance with USCG licensing, Jones Act compliance if necessary, Insurance, etc. Your guests can bring food and beverage to share, but that's about it. This is not to say friends very often don't share in buying fuel etc when you take them out fishing or sailing. Happens all the time and I'm not against it. But... When your friend's wife falls overboard and drowns, and your friend suddenly isn't your friend anymore, and his lawyer knows the right questions to ask, that tank of fuel becomes a problem. Just one of the many unintended consequences of regulations that an attorney can take advantage of.

Bareboat chartering is different. Everyone can and should share in the cost.
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Old 09-10-2019, 09:50   #12
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Re: Sailing With paying guests?

Ibet...:

What YOU think it is totally without relevance. The ONLY thing that matters is what your Insurance Underwriters and, since you are German, your Bundeszentralamt für Steuern think about it. And I should be very surprised indeed, if die Anwälten employed by the BZSt for such purposes have not long since closed the "loop holes" that once upon a time permitted people to pretend that their hobby was a business.

You should also recognize, loath as you may be to do so, that sundry international Tax Treaties require you to declare your WORLD WIDE income on the tax return you must file with the BZSt in your country of NATIONALITY, i.e. the country from which you hold, or could hold, a passport.

Do be careful that you don't in this regard, as in regard to yacht design and seamanship, get yourself up the proverbial creek!

If, once you acquire a suitable vessel, and you have the requisite qualifications as well as some considerable experience as a skipper, you should, if you want to try this, have a serious conversation not only with einem Steuerberäter but also with einem Rechtsanwälten, the former to tell you what the rules for accounting for the enterprise are, and the latter to draw up the necessary paperwork such as liability waivers.

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Old 09-10-2019, 10:00   #13
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Re: Sailing With paying guests?

I do 5-7 per year to defer cost of boat. Make enough to pay for slip fees, insurance, and upgrades. Most have been very pleasant. It is nice to be around people on vacation. Much better than day job. Have 50 ton masters with sail. Insurance due to hurricanes in BVI increased 3x because of hurricanes not the charter endorsement. The single "guide" endorsement was only $125 more per year. If I had multi guide it was $300 more per year. My boat is not inspected, therefore only 6 pax. A week is about $3500. They pay for food and drinks.
Last year we added a genset from proceeds. This year we are getting new sails. We do take a profit but not much. I try to put everything back into the boat. We also purchased a water maker this year.
All of my guests consider me a friend when they leave. All have enjoyed themselves.
Most tip very well.
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Old 09-10-2019, 10:23   #14
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Re: Sailing With paying guests?

Interesting discussion.

I looked but couldn't find anything in the US regs that discusses the difference between paying and sharing expenses. I know in aviation, it is not considered compensation for the passengers to contribute toward fuel.

In the 90's I was in a sailing club that used to offer weekend trips. The skippers were just other club members who volunteered to take the boat and passengers on a weekend coastal sail. The skippers weren't paid but the seats were "sold". I don't know if they needed special insurance for these trips or if it was just considered a club function.

They also had Wednesday night cruises where you could buy a seat and go out with a skipper.

Maybe there is an exception for "clubs". Perhaps you ask your passengers to buy a share in your club and come along for a "free" ride.

Or to borrow a concept...

In real estate, some clever people came up with the concept of a Co-operative which has many of the same benefits and risk protections. The Co-operative does need to insure itself as an entity. As a "owner" you only owned shares in the Co-operative. This may seem like a side issue, but I'm thinking that you could sell limited duration shares in the cruising co-operative, where it is a happy group of people sharing the expenses of the cruise that they bought shares in. When the cruise ends, they surrender their shares back to you... So it is the same income stream, just a different legal lens.

Don't hate on me, I'm just trying to think out of the box. In hindsight though, that would be hard for people to get their head around, so it would be a tough sell.
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Old 09-10-2019, 10:25   #15
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Re: Sailing With paying guests?

Quote:
Originally Posted by mvweebles View Post
Really depends on what you are trying to achieve. If purely some companionship and cost-sharing, not a problem. But if more of an ongoing arrangement underpinned by a commercial interest (advertising, online posts, etc.), you are at-risk. Spinning it is pretty transparent: Craigslist is full of advertisements for 'escorts' who seek 'donations.'

That said, many people operate in the shadows. There will be no issue until something goes wrong or a disgruntled 'cruiser' complains. Just depends on your tolerance for risk and how much you have to lose.
The Coast Guard looks at "cost sharing" a little different, if it is a requirement or expected that the guest pay for fuel, food, marina fees the Coast Guard looks at it as compensation, Requirements can be found in USCG NVIC 07-94, 46 USC 2101
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