Originally Posted by MartyB
Hey guys! I need some advices.
We are new sailors
and just purchased a new FP cat. The idea is we are going to take delivery in La Rochelle somewhere at the beginning on 2022 and then we plan on sailing the Med for the summer of 2022. We will then cross the Atlantic in December 2022
and bring the boat into the Bahamas where it is going to stay in a charter
fleet for 3-4 years before we retire...
You are Canadian so you could readily pursue Canadian registry and flagging.
You are purchasing
the vessel in France
but it seems you are intending to stay in the EU after the purchase
which seemingly could invoke VAT that otherwise could be waived as you are non-residents of the EU and could instead promptly export the boat from the EU. Check with FP about arranging for a temporary importation of the vessel so as to avoid the VAT and flag the vessel in a country other than an EU territory.
Since VAT is only assessed one time on a vessel, rather than being assessed each time it is purchased as with a sales or use tax, such a boat will never again be liable for a EU-related VAT assessment by any EU member
or future. Especially if you prefer purchasing
a new boat
, VAT will add significant cost (roughly 20% +/- of the full purchase
price), so this may not prove sensible if you plan to sail back to your home country. However, another option is to inquire about taking formal delivery of the boat in one of the EU countries where VAT is lowest, thereby minimizing the VAT payment while still having VAT-paid status. Why would anyone choose to pay VAT? Don’t overlook the fact that, within the EU, most of the value of VAT paid on a vessel ends up being folded into the equity value of the boat. Consequently, if you plan on later selling this boat within the EU after your European cruise
, much of the VAT cost will be reimbursed as part of the sale price
and, meanwhile, you won’t VAT-based time restrictions on your cruising plans.
Further reference: European Commission's Frequently Asked Questions on: Rules for private boats
Snpet there from:
"Whereas, Non-EU vessels which are intended for re-export may be temporarily be brought into and used for private purposes in the EU, or more strictly in the 'customs territory of the Union, (which includes our territorial waters) without customs
duties or Value Added Tax (VAT) needing to be paid.
The boats concerned have to be placed under the 'temporary admission procedure' (TA) with Customs
and the period of use in the EU is limited in time. When the time is up the boat has to leave,
which in official jargon means that 'the procedure must be discharged'. The re-export of the goods from the customs territory of the Union is the usual way of ending or 'discharging' a temporary admission procedure. If the boat does not leave before the end of that time then customs duty and
VAT become due.
A boat is temporarily admitted into the EU and not into one of the constituent Member
States. Thus it can move from one Member State to another with no further customs formalities during the 18-month period allowed."
Further reference: https://www.ionianyachtsales.com/use...fo/vat-yachts/
Temporary importation relief from VAT is available to yachts beneficially owned and used by non EU residents provided such non EU resident does not become ordinarily resident in the EU.
Boats owned by non-EU residents and registered outside the EU are entitled to tax free temporary importation into the EU for a total period of eighteen months. The EU Common Customs Tariff provides for relief from VAT liability for up to 18 months (Article 562(e) as referenced above) when the boat is owned by non-EU residents and where the boat will subsequently be removed from EU waters (Article 561). The permitted period, or temporary importation, applies to the entire EU area and therefore at the end of the period the boat must be sailed to a country outside the EU or VAT must be paid. The temporary importation period may be extended, at the discretion of local customs, for various bona fide reasons, such as if the boat is left unattended and unused, if the owner leaves the EU, or if the boat is left in the care of a boatyard for repair.
Those who wish to remain longer in any one EU country must deposit the ship’s papers with the local customs office, who will put the vessel under bond. The clock will then be stopped until the owner returns on board. During the period the vessel is in bond, the boat must not move from its berth, and the owner or crew are not allowed to sleep on board.
Non-EU boats remaining inside the EU for over the permitted period must be imported and VAT paid on the value of the boat. Anyone intending to do this would be well advised to import
the boat into one of the EU countries with a lower VAT rate, such as Cyprus
There has been a harmonization of formalities concerning VAT in recent years, but there are still certain inconsistencies so the owners of boats from outside the EU should treat the matter with utmost caution and avoid being caught out. It must be stressed that the above 18-month VAT relief applies only where the boat is owned and sailed by a person not resident in the customs territory of the EU. The relief is invalidated if the boat is hired, sold
or put at the disposal of a EU resident.
It is essential to ascertain on arrival in a new country the exact situation concerning VAT. As non-EU boats are required to contact immigration whenever crossing a border between EU countries, this may be the time to make such enquiries.
provisions on temporary importation are found in: Articles 137 to 144 of the Customs Code (Council Regulation (EEC) N° 2913/92 of 12 October 1992 establishing the Community Customs) and in particular Articles 553 to 562 of the implementing provisions of the Customs Code (Commission Regulation (EEC) No 2454/93 of 2 July 1993).
Customs Procedures in the European Union
Departure from a EU port to another EU port: no formalities required. Arrival in a EU port directly from another EU port: no formalities for EU vessels and EU citizens. Immigration must be contacted if there are non-EU citizens aboard. Customs must be notified if there is anything to declare, such as firearms.
Departure from a EU port to a non-EU port: customs and immigration must be notified. Arrival in a EU port from a non-EU port: Q flag must be flown when entering 12-mile limit. Customs and immigration must be contacted on arrival.
Yachts must carry their original registration
document, insurance policy and ship’s radio license
. One member of the crew must have a radio
operator’s certificate of competence. For EU boats, proof of VAT status is also required. It is also very useful to have a typed sheet containing the name of the boat, port of registry, and the crew list.
As to planning your 2022 sojourn in the EU / Schengen countries, you will need to plan your trip around your short term visa-free waiver restrictions.
The rule states that non-EU/Schengen visitors can only spend up to 90 days out of any 180 day rolling period of time in the EU without applying for a long stay visa or residency. So over the course of a year you can spent 180 days in the EU, but not all in one go, that being achieved as two sets of upto 90 days in any 180 day rolling period.
Reference as to visa details. https://eeas.europa.eu/sites/eeas/fi...er_faqs_en.pdf
guidance titled: What you should know before buying
your new boat
and importing into North America https://www.beneteau.com/us/news/pit...ew-boat-europe
Enjoy your new boat and your voyage. All the best.