Boat Registration in UK

[Dockhead]

So, the boat I've finally settled on turns out to be VAT-paid in the EU. Since I plan to use the boat primarily in the Med (and probably keep her on the South Coast of England the first year), the VAT status is useful, also if I go to sell her sometime.

I am a U.S. citizen living in a non-EU Eastern European country. I had thought to register my boat in the U.S., which as it turns out is dead simple and dead cheap for a U.S. citizen. But this changes the game.

The boat brokers told me that foreigners register their boats all the time in the U.K. -- as long as they have an address no one asks any questions. The rules say, however, that foreigners are not entitled to fly the Red Ensign unless they are established in the U.K. -- that is, permanent residents.

Does any of you U.K. yotties have any words of wisdom for me?

[bitman]

Originally Posted by Dockhead

-- as long as they have an address no one asks any questions.

here is your answer?

[sestina]

Here's a link to the UK's ship registry UK Ship Register

In an nutshell, there are two sorts of registry for yachts. Part I and Part III.

Part I is the main one as used by ships etc. It also shows if a mortgage has been raised against the vessel. Who owns it and in what proportion. To get on this registry you have to show an unbroken series of owners from the original builder to the present day. The usual method of proving this is by the "Bill of Sale". Also, the boat has to be measured by an approved surveyor for tonnage measurement.

As you can imagine it can be quite expensive. My moat came Part I registered and I've kept it up.

Part III is a completely different animal. It really doesn't mean very much apart from giving you a bit of paper to wave at foreign officials. You can do the forms on-line.

Sorry I don't know about the VAT implications for a non EU residents. You could try searching on this forum for suggestions. Yachting and Boating World forums: Viewing forum: Yachting Monthly's Scuttlebutt

I warn you the search facility is pants so don't be afraid to start a new thread.

[Dockhead]

Thanks very much! I'll check the forums you kindly provided link to.

I don't really understand why you would have two such different registries. Maybe Part III -- which sounds very informal -- is for me? I'm not sure I really need anything more than a "bit of paper to wave at foreign officials". I'll be buying the boat through Oyster Brokerage from the original owner, so I'll have a good set of documents going back to the works.

I'll dig through the forums; thanks.

[David_Old_Jersey]

Part 1 was created for ships, as and when private pleasure vessels appeared they basically had to use this Register if going abroad (albeit the requirements to Part 1 register small vessels and non commercial are different - yer 30 foot yacht does not have to meet the same requirements as a Supertanker ).

However their was (and still is) no requirement for a UK boat to be registered in the UK.

Back in the mid 80's (I think) the French (& the EU?), but definately the French said that they wanted all foreign vessels visiting their waters to be registered. No doubt a numbers thing as historically UK boats did visit French waters with no registration papers and pas de problem.

The UK Govt realising that the existing Part 1 registration would be too cumbersome to administer / looked for an easy way around the French problem - and came up with the Part 3 register aka the Small Ships Register (SSR) where the requirements to register were basically nil and on demand. I have not tested it, but apparently you could get a Lawn Mower registered on the SSR

Part 2 is a bit of a mystery to me Possibly something to do with commercial fishing vessels if memory serves me correct . or not

I haven't looked at the SSR requirements for a while, I recall that it is solely for British Nationals (plus a few others from the Colonies?) but apart from having a UK address (to send your documents to) I don't know whether they actually check up on this - of course this means that your registration would not be valid. Which may or may not be a problem depending on circumstances.......and BTW the SSR is not proof of Title / Ownership. SSR works all around the world. It might be (arguably?!) a sh#tty register but is an official UK ship register so therefore has to be accepted by other countries.

A big difference between SSR and Part 1 is that SSR cannot be a company registration. The usual 100% legal work around for non UK nationals to have a UK registered boat is to Part 1 register via a UK company. Of course Part 1 registration is not without cost (I forget the exact figures all in - but vaguely I think £500 - £1000) and then maintaining a UK company via proffesionals is not cheap, but if able to DIY (with a UK address from Family / Freinds) not outrageous on annual cost - under £100 - with a bit of PITA form filling each year.....and BTW Part 1 is also not proof of Title / Ownership (the certificate actually states that) although many believe that it is - albeit in practice it pretty much is, just not 100% (in fact nothing is 100% conclusive on ownership with UK boats). Note also that although mortgages can be reqistered on the Part 1 register their is no requirement for a lender to do so - although I am led to believe as the capacity to register a loan / mortgage is available but not used that not doing so may affect the lenders security / chances of recoverability - but I would not want to test that one out personally Notwithstanding the above Part 1 is preferable to have (inclduing for resale so a buyer can easily get a loan secured) so although I would not bother with a Part 1 reg from scratch I would not let one lapse.

Of course an important thing to bear in mind is that where the boat is registered has zero to do with her VAT status! Therefore no reason why you cannot change her Reg to the USA - she will not automatically lose her VAT paid status for that. Obviously hanging the stars and stripes off her stern will make her look a little bit more non EU than a Red Ensign and therefore more likely to be non VAT in the eyes of an EU customs officer - but your passport will do pretty much the same anyway......the important thing on the VAT is to have the documentary evidence that the VAT has been paid.

Some UK folk with UK boats can be very relaxed on the VAT documentation side of things - and opinions do vary accross the web - but I would never buy a UK boat without being able to prove she had been VAT paid or I didn't want to use her for extended periods in the EU or she was 15% cheaper........on the basis that at the moment no proof of VAT paid is not my problem, after I bought it could be - and why would I want to take that / any risk when other boats with all the paperwork are available?.....but, as I said, opinions do vary accross the web on boat VAT Folk with VAT paid boats but no docs can sell them to anyone they want. except me

[Dockhead]

Thank you, thank you. This is most fascinating. It is amazing that something so serious as ownership of a vessel in international commerce could be so informal and non-bureaucratic. I really like it, especially this Part III registration, which sounds like it was invented just to p*** off Frog bureaucrats.

But this boat has Part I reg now. Hmmm. And U.S. registration is really easy and really conclusive (it IS a certificate of title), costs almost nil, and is good for life and never needs to be renewed. If it really doesn't affect VAT status, maybe I should give it another think. Do you suppose that VAT status and customs clearance would be the same thing? With EU VAT paid, I don't have to clear into customs every time I enter a new EU port? This is most confusing.

Thanks again for all your help.

[Rhosyn Mor]

A couple of points, everything David says is correct. But if you are keeping the boat in the EU under a US flag she will have to leave I think it is once a year, check the thread on the couple fighting Spanish authorities right now. Also you do have to renew US documentation every year. The UK is very very relaxed about boat registration, but the rest of the EU is not. Even if you had paid VAT as a non EU vessel you will have to clear in at every port, the only vessels that do not are the national vessels of that country, even EU vessels need to clear in and out, at leaast by notifying to local Guarda. Also remember that if you document the vessel as a UK vessel and then show a US passport, you will likely bring down the wrath of confused authority upon you, something you DO NOT want to have happen in France, Spain or Italy

[David_Old_Jersey]

Originally Posted by Dockhead

But this boat has Part I reg now. Hmmm. And U.S. registration is really easy and really conclusive (it IS a certificate of title), costs almost nil, and is good for life and never needs to be renewed. If it really doesn't affect VAT status, maybe I should give it another think. Do you suppose that VAT status and customs clearance would be the same thing? With EU VAT paid, I don't have to clear into customs every time I enter a new EU port? This is most confusing.

a) an EU VAT Paid boat, which has (probably) never left Europe but is registered in the USA and skippered by a US Citizen / has non EU crew aboard.

Or

b) an EU VAT Paid boat, which has (probably) never left Europe but is registered in the UK and skippered by a US Citizen / has non EU crew aboard.


Mmmmm. Starting to move into uncharted waters for me with Customs clearance into the EU for a boat . But my thinking (that means I am not sure - but it sounds about right ) is that simply because a boat is VAT paid does not mean it can avoid clearing customs IF their is any other reason to (say, from being a non-EU registered vessel) - just that it means the outcome of such a customs clearance would not in 2 years time include a bill for VAT

I think that is one to Google for a US registered yacht arriving from the US (and ignoring the VAT issue) simply for the customs clearance procedures for the boat.

and then of course we have immigration clearance into the EU / individual EU countries for the non EU crew - which is a seperate matter - albeit in practice dealt with at the same time. I don't know for sure, but I suspect US folk wandering around the EU for any great length of time need a visa in at least some EU countries - and from my recollection their is no EU wide VISA scheme....I only mention it to further confuse / to keep you Googling ........and as if the crew will have to be checking into each country anyway then the boat doing the same is no great additional burden in practice.


But thinking a bit more , I can see why a UK registration would be attractive for the sake of (EU) simplicity. Especially as the vessel is part 1 registered already I would try and keep this (note that if she became US registered she would have to be formally delisted from the UK Part 1 register) - I am also thinking that if / when you come to sell in the UK / EU the less likley to put anyone off with a "foreign" boat. As a Non UK national and not really based in the UK the only 100% straight way to proceed would be by using a UK (or EU) company. This Declaration of Eligibility has some guidance notes on it http://www.mcga.gov.uk/c4mca/msf4727...igibility).pdf

Out of choice I would go for a UK company for simplicity. The downside is cost if done 100% proffesionally - but can be made fairly cheap if one can obtain a UK address for free, rather than pay for a registered office address and are willing to deal with your own annual paperwork. This is the UK company registry:-
Incorporating a company


Confusing? Yeah

[David_Old_Jersey]

The trick when writing a long post is not to wander off and do something else and later simply hit send

But the good news is that in the meantime Rhosyn has shed some light on the US flag angle

[Dockhead]

Thank you, thank you, for all this thoughtful advice. If you add to this brew crew and guests with passports from various Former Soviet Union republics/former Cold War enemies, you do get a pretty funny picture of the contorted face of the provincial spanish customs agent. Oh, and the skipper, a U.S. citizen, carries a Russian certificate of competence. Hah! Welcome to my life.

A U.K. corp (or BVI corp, who is also entitled to register in the UK shipping register) is starting to sound like the path of least resistance. Corporate ownership has another benefit, which is limited liability. Fairly theoretical I guess but you never know when it might come in handy.

Just one last (I promise) question -- can it be, that the flag status of the vessel and her customs status are two different things, not related? That is -- the boat might be registered in my name in the U.S., but has never been out of EU waters and is thus "imported" into the EU, as it were, VAT paid and all?

I have been told by the authorities in the U.S. that flag has nothing to do with taxes. If I buy a boat abroad and flag her in the U.S., there are no taxes or duty due as long as she stays out of U.S. waters. If she is brought into U.S. waters, then you have to pay 1.5% duty, and any local sales tax (0% -- 9%) imposed by the state of your residence.

So maybe it's like -- the is imported into some country, has been cleared there, has taxes paid there, but the flag is something completely different and unrelated?

If that were the case, then the U.S. flag might not be so bad, but for the stigma of yankhood, the expectation of local officials that they are dealing with a non-EU cleared vessel, and the points you mentioned, well of course those do add up. I guess if you sail up flying the Red Ensign, local ports in the EU will be much more relaxed, not expecting to be dealing with anything exotic.

[MoonlightShadow]

One of the problems that you are up against, is that just about every Country in Europe has different legislation - or, interprets the legislation in a different manner. Forget this "EU" thingy being about harmonisation of laws. Most have adopted the EU laws, and kept their own ones as well. In the old days, before the EU, when it was the EEC, you could travel all around Europe and never even be asked for a passport or anything. Other than in Switzerland and such places.

Your VAT paid status, applies throughout Europe, unless, you physically sell the boat outside of Europe, in which case the VAT lapses. VAT has no bearing on flag, other than, on a registered British vessel it must be VAT paid.

For an idea on what paperwork a Brit yacht needs to visit other Countries in Europe, try looking at The RYA knowledge base - foriegn travel. http://www.rya.org.uk/KnowledgeBase/...es/abroad.aspx

You still have to do customs and immigration clearances at each "port of entry" to each Country. In addition, some Countries in Europe (you will witness the present Spanish thread) have devised cunning plans to relieve you of more money in the form of additional taxes if you "reside" on your boat or ashore in that Country for more than a certain period of time (183 days in Spain). The moral seems to be to move about a bit, never spending more than six months in each country, other than the UK where if you are an American, no one seems to give a toss.

There are other Countries in which you will not be taxed like this, but the best thing is to ask about a bit at your last port, before you move to another country other than for a visit.

I am surprised however, that David worries about VAT and stuff, as he lives in Jersey which is "special" in tax terms. (Special in other ways too!). You may note, that on your trip down the East Coast from Oysters, you will see a number of "local" boats, which are registered in Jersey and Guernsey, for some reason I have no idea about.

Perhaps David could enlighten us? Is can't be a VAT thing, as these boats stay here all the time. What is the advantage of Channel Island Registration David?

[Dockhead]

Originally Posted by MoonlightShadow

In the old days, before the EU, when it was the EEC, you could travel all around Europe and never even be asked for a passport or anything.

Yeah, and before 1914, hardly anyone even had a passport. You could simply go where you please -- as God intended. The old passport and border control system broke down when long distance railways started to work well, and European countries simply abolished them.

Well, thanks very much for all this good advice. I think I have a reasonable idea now what's involved. I am wavering between keeping the Part I registration in a U.K. company, and just registering in my own name in the U.S. For the U.K. company: U.K. flag will look better in EU ports; limited liability. For U.S. flag: simple, cheap, fast. From a tax point of view, from point of view of formalities in EU ports, it looks like there is no difference, but I'm still studying the matter.

[Dockhead]

P.S. I think the boat can stay in any EU port indefinitely, if I understand the rules right, whatever the flag (the boat will have been bought VAT-paid inside the EU). I have a job, unforunately, and will not be spending 183 days a year anywhere except slaving behind my desk, so the Spanish situation can't happen to me.

The Spanish situation is a case where a person who is resident in Spain has to re-register (re-flag) his cars and boats in Spain and pay Spanish taxes. This applies to people, not boats.

For boats, as distinguished from their owners, if I understand the regime correctly, the important thing is VAT. If VAT is not paid, then a boat can be used in EU waters based on being temporarily imported for up to 18 months. But if VAT is paid, as in my case, then whether the flag is U.K., U.S., or Somalian, the boat is legal forever (not her owner, however, who has to respect the immigration regime according to his citizenship!), unless she is sold outside of the EU, in which case her VAT status is extinguished.

[bitman]

for persons of out side the EU there is an schengen visa what gives the right to travel through all schengen member states. this schengen visa can be obtained in any schengen member state. just choose the one with the less difficulties.

Schengen Visa Applications | Europe Tourist and Business Visas

[Dockhead]

Thanks -- I'm ok with the visa question. I've got a U.S. passport. As long as I don't stay more than 90 days at a time I'm cool, and unfortunately I never have 90 days off.