US Citizen new vessel purchase registration options for use outside the US???

[Steve_C]

I will be taking delivery of a new vessel in the Med Jan next year. I will be using the boat outside of the US and it will potentially never be brought to the US. Can the boat be US flagged without paying import duties or sales tax? I totally understand I would need to pay import fees if I bring the vessel into the US. I am also not opposed to import fees if I can avoid sales tax, provided this is the most advantageous way to flag the vessel.

I would love to find someone to consult about the best options for registration and would also consider foreign registration. I am NOT looking to skirt the law, but I also don't see a need to give away vast amounts if its easily and legally avoidable.

[Shrew]

US Documentation doesn't collect "Sales" or "Use Tax" that is done at the State level. I would assume that you would need to pay an import or Duty (1.5%) on the vessel.

I don't know of a way to document it without Importing it. Regardless of whether it is physically in the country.


https://cbpcomplaints.cbp.gov/s/arti...rm%203520%2D21.

[valhalla360]

If you don't import it, no import tax.

Likewise, if it never enters a state, no state tax.

[Dsanduril]

For a US citizen USCG documentation is pretty darn simple and also pretty cheap, unless you have some specific reasons to do so I wouldn’t scratch around too hard for alternate flags.

Other than the builder’s certificate/bill of sale you really don’t need much for recreational documentation, so it can be done with the boat anywhere in the world. Really the only kink is the notary/apostille being acceptable to the USCG. I haven’t done a new boat this way, would be worth a call to the NVDC in advance (they are very helpful) just to make sure you get all the proper forms and what signatures are required from a foreign corporation.

We bought our boat in NZ, had the bill of sale stamped by a German apostille (residence of the PO), and got US documentation no problem. No costs other than the documentation fee (currently $133 including first year, then $26/year renewal - changes a bit next year with the 5-year CoD). Four years later we brought the boat into the US and paid CBP their 1.5% duty (discounted from the purchase price by ~20% because the boat was 4 years older). No sales/use tax owed because of the length of time we had owned the boat, but that is specific to the state of principle use - before the boat enters the US there is no state of principle use regardless of your own domicile.

[Steve_C]

Originally Posted by Dsanduril

For a US citizen USCG documentation is pretty darn simple and also pretty cheap, unless you have some specific reasons to do so I wouldn’t scratch around too hard for alternate flags.

Other than the builder’s certificate/bill of sale you really don’t need much for recreational documentation, so it can be done with the boat anywhere in the world. Really the only kink is the notary/apostille being acceptable to the USCG. I haven’t done a new boat this way, would be worth a call to the NVDC in advance (they are very helpful) just to make sure you get all the proper forms and what signatures are required from a foreign corporation.

We bought our boat in NZ, had the bill of sale stamped by a German apostille (residence of the PO), and got US documentation no problem. No costs other than the documentation fee (currently $133 including first year, then $26/year renewal - changes a bit next year with the 5-year CoD). Four years later we brought the boat into the US and paid CBP their 1.5% duty (discounted from the purchase price by ~20% because the boat was 4 years older). No sales/use tax owed because of the length of time we had owned the boat, but that is specific to the state of principle use - before the boat enters the US there is no state of principle use regardless of your own domicile.

This is most helpful and exactly what I was hoping to find out. Thanks!

[nolakennedys]

As long as it's not imported, no duty applies.

https://cbpcomplaints.cbp.gov/s/arti...language=en_US

Can register it or flag it anywhere. If you bring it here and use it here, you may run into problems long term, but hard to say.

[Desert Spray]

Originally Posted by nolakennedys

As long as it's not imported, no duty applies.

https://cbpcomplaints.cbp.gov/s/arti...language=en_US

Can register it or flag it anywhere. If you bring it here and use it here, you may run into problems long term, but hard to say.

I agree with what is stated above, but have two additional issues to consider.

We have a USA flagged sailboat in Greece and at times wish it were flagged within the EU. The rule for us in Greece is to present the Transit Log and other boat papers to Port Police at each harbor upon entering and within 24 hours of leaving. We find much variability in how insistent the Port Police are on adherence to the letter of the law. We are almost alway treated courteously by the officials and are entertained by their love of rubber stamps. Nonetheless, I would rather search for a nice meal than an obscurely located Port Police office (particularly in Nafplio). EU boats do not need to check in and out with each harbor stop in the EU. I’m jealous.

Also, Yacht insurance in the Mediterranean has become more challenging for non-EU/UK boats, with non-EU/UK based owners. I’ve had zero claims, yet I’m with my third insurance company since 2018.

Otherwise, I’m proud to fly our USA flag.

[Dougtiff]

I thought a first time documented vessel had to be measured, mine shows NET tonnage, along with the #.

[Dsanduril]

Originally Posted by Dougtiff

I thought a first time documented vessel had to be measured, mine shows NET tonnage, along with the #.

It does, but any recreational vessel, and other vessels under 79 feet can use the Simplified Measurement system and just fill out the form with the vessel's dimensions (a few caveats shown on the form, but only apply to vessels > 79').

CG-5397 Simplified Measurement


FWIW, in the recreational world the USCG doesn't seem to pay much attention, searching the documentation database for our model yields measurement from 7-40 tons across about a dozen vessels, all from different interpretations of how to fill out the Simplified Measurement form.

[jmschmidt]

If your new boat is being built in South Africa you may import directly it into the US duty free. That's duty free, not COST FREE, they have a bunch of other small fees that they smack you with. Forget state registration, get it US Coast Guard documented. PM me with a phone number, we need to talk.

[greenlantern]

You can consider Polish registration. By buying a boat in the EU, the VAT is presumably already paid, so with a European flag you can keep the boat in the Med indefinitely. No US import, no US tax, no US flag. Polish registration is for life, cheap and is relatively hassle-free compared to other European countries. More here:

https://www.polishyachtflag.com/blog...he-polish-flag

[bullislandken]

We have a South African vessel and we are the 6th owners in the US. We asked a broker to list our boat for sale and they said since we don’t have form 7501 proving the import duty has been paid that we have pay duty now.

It has been in the US for over 19 years. They would list it for sale with this statement in the ad “Not For Sale to US citizens in US Waters. We have called USCG, Customs and Immigration, State of Florida, etc. and we find no evidence of the duty being paid.

Can you suggest a method to prove duty was paid probably in June of 2002?
Thanks!

Originally Posted by jmschmidt

If your new boat is being built in South Africa you may import directly it into the US duty free. That's duty free, not COST FREE, they have a bunch of other small fees that they smack you with. Forget state registration, get it US Coast Guard documented. PM me with a phone number, we need to talk.