Benefits of Corporate Ownership of a Vessel ?

[sj01]

Are there insurance benefits (or any other benefits) if a sailboat is owned by a corporation as opposed to an individual? I've noticed that some of the insurance companies ask while others do not.

thanks.

[cwyckham]

Only benefit that I'm aware of (in my jurisdiction - Canada) is that there is no sales tax when you transfer ownership of the corporation (which owns the boat) as opposed to transferring ownership of the boat itself.

Many believe this is outweighed by the ongoing cost and hassle of maintaining the corporations paperwork and annual reports, lawyer fees, and the fact that it is much more difficult to get financing to buy a corporation than a boat.

Chris

[cal40john]

There's a book written by a Seattle lawyer, can't remember the title now, something about legally owning your boat. When I glanced through it, it had a chapter on having an LLC own the boat to limit your liability. I didn't buy the book, and I didn't read it standing there in the store. I saw it at Armchair Sailor in Seattle. If you call and describe it, I'm sure they'll figure it out and ship you a copy.

Maybe it makes it harder to sue you, but at least in the U.S. I would think that even if the boat was held by an LLC they could still find some way to sue you for your personal assets.

John

[Palarran]

Go to the Dollars and Cent's section of the forum - from the home page, and start paging backwards. There are a whole lot of previous threads on this exact topic.

But quickly - liability is one step removed from you personally and if you charter the boat at all, you can write off some of your expenses. That you need to talk to an accountant about because pigs get fat - hogs get slaughtered.

[David_Old_Jersey]

Pros and cons depend where in the world you are, the use and location of the vessel. and your personal / business tax situation......and the outcome you are trying to acheive.

First port of call should be your Accountant / Tax Advisor - if you haven't already got one of those the odds are high that the answer will be no great benefit. and easily outweighed by cost and paperwork.

[sj01]

Thanks all for the responses thus far.
The boat is in Florida and would be purchased without financing. As for the corporation, it already exists and must be maintained as it is the vehicle used to purchase and hold firearms of the class 3 variety.
As far as benefits go, I suppose my biggest hope is that insurance would somehow be a little lower. Don't know why or how, just hoping.

[hellosailor]

You insurer may not ask, but they will ask for the name of the TITLE HOLDER of the vessel and if that says "XYZ Corp" the gig is up. Not to mention, if you fail to disclose material facts (i.e. the vessel is a personal pleasure craft versus a business asset supposedly used for business purposes) the insurer can step aside and say you defrauded them, you've got no coverage.

If the corporation has no bona fide business purpose, and the boat is not used as part of the business, in the US it can be declared a sham corporation and actions taken against whoever really owns it for whatever purposes. Having the business own it on paper, and having the boat be an actual working business asset, are two very different things. The folks who have been called out over this will tell you it is a very painful experience.
So unless the corporation is chartering out the boat, or using it to test new technologies, or as a showroom, etcetera...all you'll accomplish is paying the steeper commercial rates for your insurance.