Best Way to Avoid EU VAT ?

[Hurricane Harry]

Hoppy and taxman here in Sweden have eyes everywhere./Harry

[David_Old_Jersey]

Originally Posted by hoppy

Actually most of the yachts I am looking at are EU flagged. Either owned by real charter companies or other companies that can justify the yacht and not pay tax on them. Some yachts are in Croatia or Turkey which is not the EU and may be treated differently again.

Your boat budget will also impact whether any ideas are worth the costs - what sort of boat value are you thinking of?

FWIW being "offshore" from the EU we do view boats with VAT paid (& with proof of) as being worth more - and sometimes desirable, depending on intended use in EU and / or a wish to later be able to sell more easily into the EU (simply for the wider market). Having said that, I am aware that some do not take this view - but, as they say, each to their own


My initial thoughts are to base the boat outside the EU (Turkey?) and either keep it their all year. or to do that and then visit Greece for extended periods. The question then being how long extended can be within Greece Although I cannot quote you the law, our French cousins give us 6 months within France (for non VAT paid boats. or those without evidence of).................. otherwise a VAT (TVA) bill is payable. Greece of course is a different country , but I am sure folk pushing the limits when "visiting" Greece is a well trodden path, for both foreigners and locals - plusses and minuses for you on that (good that others will have discovered the rules (including the hard way), not so good that the Greek authorities will have discovered that their can be easy VAT bills to issue by looking at "foreigners").

[blubaju]

Originally Posted by David_Old_Jersey

....

My initial thoughts are to base the boat outside the EU (Turkey?) and either keep it their all year. or to do that and then visit Greece for extended periods. The question then being how long extended can be within Greece Although I cannot quote you the law, our French cousins give us 6 months within France (for non VAT paid boats. or those without evidence of).................. otherwise a VAT (TVA) bill is payable. Greece of course is a different country , but I am sure folk pushing the limits when "visiting" Greece is a well trodden path, for both foreigners and locals - plusses and minuses for you on that (good that others will have discovered the rules (including the hard way), not so good that the Greek authorities will have discovered that their can be easy VAT bills to issue by looking at "foreigners").

VAT legislation is the same for all EU members, the implementation differs. A grace period given in one country may not be granted in another. Greece is a particular problem, what seems illegal in one harbour might not bother anyone in another. Greece is known to invennt new taxes on a regular basis, many of them are withdrawn from EU courts, like the newest lighthouse tax, now only applied to non-EU visitors. Check noonsite and others for Greece, impossible to keep up with them. Imagine, they have an income tax only based on the length of a residents boat and engine size of the car. This totally independent from regular income tax....

[goboatingnow]

Just to reiterate to the OP, As a EU tax resident ( and one not resident in funny designated areas, you do not have any choice, if you are not entitled to VAT regustration, you have to pay VAT. You will not have any "grace" period in visiting other EU countries. Advice from residents of tax free areas like the channel islands, only applies to them and not you.

FWIW being "offshore" from the EU

Really Davd_old_jersey. I dont think the EU thinks so. You are within the EU for all intents , including being part of the Customs Union of the EU .its just that you arnt subject to one of the EU taxes ie VAT ( like the canaries).

[David_Old_Jersey]

Originally Posted by goboatingnow

Really Davd_old_jersey. I dont think the EU thinks so. You are within the EU for all intents , including being part of the Customs Union of the EU .its just that you arnt subject to one of the EU taxes ie VAT ( like the canaries).

Amazing that someone can pack so much lack of understanding into such a short statement .

Congratulations. and keep up the good work

[goboatingnow]

perhaps you might enligthen readers as to what you disagree with in that statement, rather then some sort of god like response

[goboatingnow]

You are within the EU for all intents

Yes you are right in regards to that statement, over zealous me, Jersey does fall within the Customs Union though and my other comments stand, in relation to advice

[plato-gb]

Does anyone know.........
Can a non-EU tax resident 'reimport' a vat paid boat to the EU and sell it to an EU resident without paying vat again and without the boat losing its vat paid status?
Wierd question, I know - we're looking to buy at a boat that paid vat a long time ago, went to Jersey (we don't know for how long exactly) and then was sold by the Jersey resident to a UK resident in France. Reason for my question: if the Jersey resident brought the boat back into EU waters with the TI (Temporary Import) and sold it while in EU to the EU resident then it has lost any VAT paid status it had.
So it's a non-EU resident - he bought the boat, vat paid in France, took it to Jersey for however long, then brought it back into France and sold it to a Brit.

Was he allowed, as a non-EU resident, to 're-import' the boat without paying vat again into the EU on a permanent as opposed to Temporary Import. It's doing my head in, any help appreciated..............

[Martinini]

If the boat was ever registered in the USA I think you would have to pay Import and or VAT on the deal. If the boat maintained EU registration, might not, if the Brit registered in the UK maybe not. Lawyer time?

[blubaju]

Originally Posted by plato-gb

Does anyone know.........
Can a non-EU tax resident 'reimport' a vat paid boat to the EU and sell it to an EU resident without paying vat again and without the boat losing its vat paid status?
Wierd question, I know - we're looking to buy at a boat that paid vat a long time ago, went to Jersey (we don't know for how long exactly) and then was sold by the Jersey resident to a UK resident in France. Reason for my question: if the Jersey resident brought the boat back into EU waters with the TI (Temporary Import) and sold it while in EU to the EU resident then it has lost any VAT paid status it had.
So it's a non-EU resident - he bought the boat, vat paid in France, took it to Jersey for however long, then brought it back into France and sold it to a Brit.

Was he allowed, as a non-EU resident, to 're-import' the boat without paying vat again into the EU on a permanent as opposed to Temporary Import. It's doing my head in, any help appreciated..............

VAT expiration is a permanent problem here and again, the EU sets a legal frame, national implementation still allows for national surprises.
In general, after a year outside EU the VAT-paid status is lost. As even the tax collectors think this is harsh on somone sailing around the world the original owner usually enjoys a tax holiday at the return of his/her journey. But you have no right on this, it depends on your country and tax collector.

Selling the boat outside EU waters looses the VAT-paid status, make the contract within EU, best, bring the boat into a EU country if possible. Though you must have a serious tax fraud investigation until they dig that far.

I guess with Jersey you refer to the Channel Island, they are a different horse again, consider themself NOT as a part of EU, not even of Great Britain but under the crown (for protection and conveniance?!) though there exists a German Highest Court dicition [1. Juli 2002 (II ZR 380/00)] with opposite conclution. Maybe if you contract in Germany the tax collector must follow his highest court and then the boat has never left EU waters, VAT still valid, you are free to move within EU, buy and sell anywhere, maybe if the boat is worth it, invest in a very bright tax accountant or two ;-)


This is to my best knowledge as a eu-tax payer, eu-resident, eu-citizen and eu-registered_boat owner in a non eu-country, without any warranty, just to give you some food for the brain

[plato-gb]

boat has definitely been out of EU waters - that is a given. The owner before the current Brit was definitely a Jersey resident and therefore, not an EU tax resident. Vessel was exported by him from France to Jersey.
My understanding is that a non-EU tax resident cannot get RGR (Returned Goods Relief) on a vessel being re-imported into the EU even if the vessel's status had been VAT paid prior to export.
He could have re-entered EU waters using a TI - Temporary Import, allowing him to sail in EU waters for 18 months, but since one of the prerequisites for VAT free import is that the same person who exported be the one to re-import, my understanding is that he couldn't actuall re-import the vessel once he'd taken her out of EU waters - he could just sail around for 18 months, take her out of EU waters for another 6 and then come back for another 18.

The real point of this is that if he did bring her back into the EU under TI, one thing which DEFINITELY invalidates the VAT paid status is if the vessel is sold or chartered during the 18 month period it spends within the EU. This apparently happened, since the current Brit owner took delivery in France.

Any comments?

[blubaju]

Originally Posted by plato-gb

...

Any comments?

Perfect summary!

Though the German court decision nags, probably in vain...

[hoppy]

Whilst we are on the topic of buying an EU tax paid boat outside of the EU and bringing it back, what is the situation if you buy French flagged and taxed yacht in one of the French OS territories in the Carib or Sou Pac?

If understand it correctly, the French regard those places as being part of France so they use the Euro and the locals are possibly French citizens but is it therefore regarded as the EU?

[plato-gb]

le territoire : les Dom-Tom - ARTE is a French tv station's site - if your frog isn't up to it, put this into google:
les dom tom font pas partie de l'union européenne

it should be the second site listed - just click on translate this page. It seems they really are part of the EU. The French usually refer to them as 'dom tom'

[David_Old_Jersey]

Disclaimer:-

To avoid confusion with any members of the Internet Debating Society first let me say that this is not "advice", nor is anything I say meant to be solely relied upon when spending large (boat sized) sums of money. This is the internet fer chrissakes, I could be a 97 year old hermit living in a cave in Kathmandoo . or a Goat - if anyone wants advice they can rely upon before spending 6 zero's then you need to pay for it - even if only for the later benefit of their PI insurance This is internet based "guidance", a heads up if you will, a few pointers in what is beleived (but not guaranteed) to be the right direction - and you know what? Some of it may turn out not to be 100% right nor even relevent - well whoopee dooda, yer get yer money back


I've now forgotten the question

Oh, Jersey boat selling into EU. Firstly, just because someone simply keeps a boat in Jersey does not make them a resident or tax resident. Secondly if someone lives in Jersey does not mean they cannot be resident or tax resident elsewhere - in EU or elsewhere. By choice or simply because some countries simply hate to say goodbye

But on the presumption that OP is dealing with someone who is simply living in Jersey with no EU baggage, then IME if the boat was bought in the EU with VAT paid then simply taking it to Jersey does not trigger it's loss of VAT paid status. Getting sold within Jersey does however trigger a loss of VAT paid status, the fix is to sell when the boat is within the EU.

In practice, the French Customs (who are well aware of possible VAT issues with Jersey boats) are happy if you have evidence that the boat had VAT paid at some point in it's history (in practice usually in the UK) or simply that you have evidence that the boat pre-dates VAT In the absence of any VAT being paid, it is not a crime (for a genuine non EU visitor) and the practice seems to be a 6 months annual window to visit France (which more than covers most folks in Jersey, who are simply genuine visitors to France. In any event leaving VAT issues aside, yer want to think carefully about how long you want to spend in France (or any country) continuously - as they all have taxes for living in their country. that's how they afford to run them And is a question the French Customs are as interested in as any VAT (or Goat smuggling) matters.

The best "advice" I can give is if you ain't happy with a transaction (boat or otherwise) whether from the paperwork or not (even if you suspect it is simply your own lack of understanding) is..............

Don't

Very rarely is it compulsory to write a cheque. Except for taxes