Purchasing Vessels Registered and Owned in Another Country

[Ocean2Free]

Seeking advice on the process and traps when considering to purchase outside your home country. Has anyone had any experience in a transaction of this type. Thx

[GordMay]

Greetings and welcome aboard the CF, Ocean2Free.

Many people purchase & register a boat in a country other than their own. The boat is “owned” in it’s country of registration.
It might help to reveal your country of domicile, and potential purchase location.

[virginia boy]

What would be the benefits of registering your boat in a foreign country? Taxes? I hope it's not inappropriate to ask a question on your thread. If so I apoligize. Eric

[speciald@ocens.]

Taxes and liability - but there are costs associated with these registrations that are not financially appropriate for smaller boats. Also, if the boat is owned by a foreign LLC, taxes at time of sale can be avoided as it is the LLC being sold not the boat that is property of the corporation. You may have difficulty with bank financing of a boat without US Coast Guard documentation.

[Sunspot Baby]

There is another recent thread on reasons and procedures for registering outside your country of residence.

I bought a South African documented boat in Florida, documented it in US and brought it to North Carolina.

Without knowing your country of residence it is hard to advise, but if it is the US it is really very costly to do and unless it is some huge mega-yacht I see no advantage to foreign documentation.

[osirissail]

Again, without specifics, it is difficult to give specific recommendations. Assuming you are not going to leaving the waters of the "foreign country" you can normally get a "State" registration - pay the taxes, and use the boat without hassles inside the waters of said country. It is only when you want to cross international boundaries that you need "Federal level" documentation. Kind of like a drivers license will get you anywhere inside a country, but you need a passport to cross the international border.
And that normally means - I haven't found an exception yet - you must be a citizen or legal resident of the country to get "federal level" documentation. You can set up a corporation (LLC, INC., etc.) to "own" the boat. A corporation is considered a "resident person" and then you own the corporation. But as said above that is rather complicated and expensive to set up so is not really viable for small boats - e.g., less than million dollar mega-yachts.

[Ocean2Free]

Thx folks, yes I guess providing the country details would go a long way to better framing the scenario. I am domiciled in Australia, the vessel is currently in Australia and has been for what I can determine some 18+ months while undergone refit, however she is registered in St Vincent and comes with a company LLC. My intent is to live aboard here in Australia for several years (2-3), prior to then setting sail for more distant shores.

[Vasco]

Your best bet is to get some competent Australian legal advice. If Australia is like most countries there may be impediments to using the boat in Australia as opposed to re-fitting the boat in Oz.

[osirissail]

Now the question gets really complicated - >>I am domiciled in Australia, the vessel is currently in Australia and has been for what I can determine some 18+ months while undergone refit, however she is registered in St Vincent and comes with a company LLC.<<
- - I assume by the word "domiciled" you are not a citizen of Australia? And the boat is foreign and currently owned by a St Vincent LLC which means it has a form of permit to remain in Australia for some limited amount of time.
- - The advice given to seek Australian legal help should be adhered to - even get two different legal opinions before putting any money down. Especially about whether the boat is still "legally in Australia."
- - If everything is according to Hoyle, then proceed but if you cannot get the boat registration/title/documentation done in Australia so it is now an Australian boat, you may need to leave Australia and go to a different country before being eligible to return and get a cruising permit.
- - Like most things in this world politics and legal aspects make seemingly simple things awful complicated. It just takes patience and money and finally you will be able to do as you hope to do.

[thebenjies]

I am Australian , and am seriously looking into the purchase of a Hans Christian for sale in North Carolina, any help or input regarding this enterprise would be much appreciated.
The yacht in Question is sold through a Broker , they are really good people actually, very patient and helpfull.
Price of the yacht is subject to final survey etc etc.
Boat will be sailed back , not shipped( cargo).
What sort of questions should i be asking in regard to Tax etc for the states.?
Cheers

[osirissail]

Buying the yacht in the USA is not a problem at all. You know that all yachts prices are negiotable - twice. First when making offers on the boat you bargain down to an acceptable point for both parties. (Or you can pay retail => asked price). Then after a survey by a reputable surveyor you chose and paid for - you bargain again based on the defects found in the survey. When you add up all the used boats bought and sold over the years, the nominal spread between asking and actual selling is about 33%. In individual cases it can vary from 0% to 90% but the "bell curve" peaks at about 1/3rd off asking.
- - Concurrent with purchase you need to arrange documentation from your home country. Since so many boats are bought and sold on the world market there should be provisions in most countries for final or provisional documentation. After purchase you need to have a boatyard correct the problems noted by the surveyor and then get insurance if required.
- - Normally in the USA, you can keep the yacht in a boat yard being worked on to make it seaworthy, for an almost indefinite time. You cannot live on the boat as it is essentially "in bond" until the work is finished. After that you sail off back home. Or if you get your home country registration documents, go ahead and get a cruising permit and tour the USA in the boat until you are comfortable with it. Also use that time to correct problems that will only surface as the boat is being used.
- - If you wish to use the boat within USA waters for an extended period of time you can pay the State taxes and get a State registration. Then you can use the boat within USA waters for as long as your wish (however, your personal Visa restrictions can limit the length of time you can stay in the country).
- - Questions to ask - State procedures for putting the boat "in bond" until the necessary work is completed. Or procedures for paying the tax and registering the boat in a State. Along with this it might be wise to check with the Australian Tax officials to see if any taxes paid in the USA on the purchase of the boat are deductible from whatever taxes would be owed when you bring the boat into Australia.
- - I personally know several Australians who purchased boats in Florida and sailed them back to Australia via the Caribbean "loop" east down the islands to Grenada and Trinidad then west to Panama and finally across the Pacific, so the procedures must not be onerous or impossible - folks are doing it all the time. They normally take a year or two to do the whole trip.
- - Looking at the government of Australia vessel registration website it seems rather straight forward, and similar to the USCG system. Send in the paperwork and money/fees and you get back a certificate of registration (which we in the USA call Documentation).

[thebenjies]

hi osirissail
Thanks for the info.
In regard to the purchase of the yacht , we are following exactly the same course you suggested.
I first put in an offer , then we ascertained as to what the vessel is lacking , then we agreed the final survey will bring us to the price.
And then we haggle!

I was given a Blue water questionare from our Insurance broker , and it too suggested we can Insure and provision the boat with Australian Documentation for the journey.
All insurance and documents are subject to survey and refit and must comply with Offshore standards and safety catagories pertaining to Aus standards, or International standards. So no fixy boat no saily away.

We most likely will take some time in the Carribic so we may have to obtain USA rego.
I have a Britt & Ausy Passport so that helps with the BVI.

Question.
What is the most popular -loop- root you have found to Panama?
We were thinking to hug the coast down to Florida then island hop.

all the best

[osirissail]

"We most likely will take some time in the Carribic so we may have to obtain USA rego." That does not translate into American English . . . You obtain Australian Registration concurrent with the launching of the boat. Then you either get a USA Cruising Permit or leave directly from North Carolina to the Bahamas.
- - There are multiple variations in routing back to Australia. The Caribbean "Loop" in its longest form (time needed) is from North Carolina up to the Chesapeake and then down to south Florida and then across to the Bahamas. A month or two in the Bahamas leading to a week in Turks & Caicos then a month or two in the Dominican Republic. Timing is everything. If starting late you can hole up in Luperon, D.R. for the hurricane season - July to Nov - and then resume eastward. Timing is also important in having your US cruising permit and personal Visas valid for Puerto Rico and the US Virgin Islands. After that you are a simple "show up" and get a visitor's/tourist visa stamp in all down the rest of the islands heading eastward to BVI's to St Martin -> Antigua -> Guadeloupe or St martin -> Barths -> St Kitts/Nevis -> Montserrat -> Guadeloupe. From Guadeloupe you stop at each island/area all the way to Grenada. Maybe a visit to Trinidad if you need work or want to store the boat, go home and return next season. Back to Grenada west to the A.B.C. islands then Cartagena then San Blas and finally Panama. Through the Canal to Galapagos Islands, Marquesa's, French Polynesia and westward to Tonga and south to New Zealand and or direct to PNG and Australia.
- - Variations consist of shortening the time by USA direct to the Virgins direct to Guadeloupe to Martinique to Grenadines to Grenada. the west to ABC and San Blas and Panama Canal. Pacific route is pretty much stock you just shorten the time in each stopping area. One friend from northern Australia did the whole thing in one calendar year from Florida to Queensland. But they bypassed just about everywhere.
- - A really comprehensive trip of a lifetime would take about 3 seasons which means three years. But you have the whole almost 6months of the Tropical Storm season to go back home, take care of business and then return in November. That would be two season in the Caribbean to Panama and one season crossing the 8000nm from Panama to Australia. And you might want to extend it a couple of more years to really get into the local cultures that you might never be able to visit again.