The Med and Taxes

[TJ D]

Hi All,

We're going to be heading off to the Med next summer, and can't seem to find any really clear rules on what the deal with taxes is in various countries. Some places say that we can just go to Gibraltar periodically, and the EU tax clock is reset, others say that EU authorities are relentless in trying to squeeze everyone for money.

Does anybody have any experience with this, and can point us to a place with some good info? We are intending to spend 2-3 years there, and have no problem shuffling around to Gibraltar, Turkey, Croatia, whatever when we need to.

Thanks, TJ

[rebel heart]

Lots of info here :

http://www.cruisersforum.com/forums/...eu-101028.html

[goboatingnow]

weve covered this to death already

dave

[rivonia]

Ask Be BE they really do know the answers.

[TJ D]

Thanks guys. To Dave, I didn't go back to '11 to see where this was covered to death-I've been busy sailing, not paying too much attention to internet chat rooms lately.

I was sort of looking for a resource where I can find a summary of the actual rules. I've had some trouble locating that. If anybody's got anything like that handy, I'd love a link to it.

Anyway thanks to all. We're leaving SF bay this fall, and heading across next spring.

[David_Old_Jersey]

I am afraid that due to the New World Order announced last week by the G7 (and yes, that includes the US of A) - taxes can now not only not be evaded (the illegal stuff) but also now cannot be avoided (if a taxman sends you a bill it is "wrong" to have had the foresight to not be legally liable).....too early to tell how that will work in practice. But rumour is that orange jumps suits are being ordered - in bulk........

[jckb]

Originally Posted by TJ D

I was sort of looking for a resource where I can find a summary of the actual rules. I've had some trouble locating that. If anybody's got anything like that handy, I'd love a link to it.

You'll find quite a lot on
It's written for Europeans, but most of the key points relevant to US visitors are covered. Have a rummage through the other pages listed on the right hand menu too.

People regulations (Schengen visas) create the most awkward regulations. Boats can effectively stay as long as they want.

[geraldh]

My Jersey registered sailing catamaran has just been impounded by the French police for non VAT compliance although I have documentation to prove that she has visited Tunisia less than 12 months ago. According to the French police they no longer accept the Jersey registration to avoid payment of VAT, even if yachts have been outside EU waters within 18 month. They insist that full VAT plus penalties must be paid or the yacht is impounded pending the outcome of a court case. I am not certain if any other cruisers have had a similar experience this year but I would like to post a warning to all cruisers with Jersey, Gibraltar or any other VAT exempt registration to be awa of this (new?) regulation, unless it is a French interpretation.
Looking forward to hear from anyone else who might have experienced similar problems.
Gerald

[David_Old_Jersey]

I think you might be a test case .

Just out of interest, what is your passport and where are you resident?

Hopefully GBN, our go to VAT man, will be along shortly..........actually this is probably worth it's own thread to attract some interest.

[valhalla360]

Originally Posted by geraldh

My Jersey registered sailing catamaran has just been impounded by the French police for non VAT compliance although I have documentation to prove that she has visited Tunisia less than 12 months ago. According to the French police they no longer accept the Jersey registration to avoid payment of VAT, even if yachts have been outside EU waters within 18 month. They insist that full VAT plus penalties must be paid or the yacht is impounded pending the outcome of a court case. I am not certain if any other cruisers have had a similar experience this year but I would like to post a warning to all cruisers with Jersey, Gibraltar or any other VAT exempt registration to be awa of this (new?) regulation, unless it is a French interpretation.
Looking forward to hear from anyone else who might have experienced similar problems.
Gerald

What is your citizenship? My understanding is the temporary import doesn't apply to EU citizens. The bill is due pretty much immediately upon bringing the boat into the EU customs zone (there is probably technical legal language but this is the jist).

[goboatingnow]

Originally Posted by geraldh

My Jersey registered sailing catamaran has just been impounded by the French police for non VAT compliance although I have documentation to prove that she has visited Tunisia less than 12 months ago. According to the French police they no longer accept the Jersey registration to avoid payment of VAT, even if yachts have been outside EU waters within 18 month. They insist that full VAT plus penalties must be paid or the yacht is impounded pending the outcome of a court case. I am not certain if any other cruisers have had a similar experience this year but I would like to post a warning to all cruisers with Jersey, Gibraltar or any other VAT exempt registration to be awa of this (new?) regulation, unless it is a French interpretation.
Looking forward to hear from anyone else who might have experienced similar problems.
Gerald

Jersey residents cannot avail on the 18 month TIR. The Channel Islands are not outside the custom union of the EU by. agreement. I believe jersey residents have 3 months vat free in the EU. Furthermore if you are an EU resident with a jersey registered boat , then you are the beneficial owner and on arrival into the EU proper vat is due immediately.

Doesn't look too good I'm afraid.

Where are you tax resident ?

Dave

[jckb]

Gerald,

People (of any nationality) who are resident in the EU are not permitted to use means of transport (cars, boats, planes) within the EU on which VAT has not been paid.

"Resident in the EU" - in UK - means "ordinarily resident", a common law term. In much of the rest of the EU, "resident" means they spend more than 90 days consecutively in a country (which is legally only possible if you have some sort of permission to reside through domicile, nationality, visa or residence permit.)

British passport holders with permission to reside in UK are regarded as EU residents, even though they may live in the Channel Islands.

Did you break any of the above rules?

[tom1263]

Originally Posted by jckb

People (of any nationality) who are resident in the EU are not permitted to use means of transport (cars, boats, planes) within the EU on which VAT has not been paid.

Gerald, that the Point. The only way, the boat is registered to a company in Jersey. Only then it's a temporary use in the EU.

I'm afraid this doesn't look good..

[goboatingnow]

Originally Posted by tom1263

Gerald, that the Point. The only way, the boat is registered to a company in Jersey. Only then it's a temporary use in the EU.

I'm afraid this doesn't look good..

The registration of a leisure boat , wrapped up in a company , doesn't not protect a EU tax resident from VAT , temporary or otherwise. This is a common fallacy.

EU tax law uses the term beneficial owner. Hence if the customs authorities believe you have a " hobby company" and no trade is actually taking place , then then will apply the beneficial owner clause.

If you have a proper commercial enterprise , like proven charter income, or sailing school activity , then the company ownership, and its VAT registration will allow VAT free operation indefinitely.

People that think wrapping up a boat in a channel island or other vat free area will shelter a EU tax resident them from vat are very sadly misinformed, but such scams are regularly tried unfortunately.

For "non EU " tax residents the 18 month TIR applies for vessels from non vat areas , including the Channel Islands.

Dave

[goboatingnow]

Originally Posted by jckb

Gerald,

People (of any nationality) who are resident in the EU are not permitted to use means of transport (cars, boats, planes) within the EU on which VAT has not been paid.

"Resident in the EU" - in UK - means "ordinarily resident", a common law term. In much of the rest of the EU, "resident" means they spend more than 90 days consecutively in a country (which is legally only possible if you have some sort of permission to reside through domicile, nationality, visa or residence permit.)

British passport holders with permission to reside in UK are regarded as EU residents, even though they may live in the Channel Islands.

Did you break any of the above rules?

Residency , for tax purposes is actually much more complex then just 90 days , EU tax residency can occur on property ownership, etc etc m not just from establishing domicile. Furthermore tax residency on new means of transport can require local registration of the boat ,acquiring local competency certification where applicable and the payment of various taxes outside of vat.

Dave