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Old 19-02-2020, 09:33   #1
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Avoiding VAT on European delivery?

Hello everyone,

Apologies if this was already answered before; I’ve read quite a few of threads and haven’t found a proper answer.

We’re building a boat outside of EU, and are expected to take delivery in a couple months. I’m a EU citizen, fiancé is US citizen. The plan is to leave EU within a few months for ARC, and do a circumnavigation over the next few years. After that, the boat will likely be in the US or Caribbean.

So - we’re really not planning to import the vessel in the EU and paying VAT for those few months seems nonsensical. We’re OK to pay the US import tax (AFAIK capped to $18000 in some states) and fly the US flag. Someone once told me we’d need to do it as soon as we step into US waters.

Now, it’s pretty unclear if:
1. The vessel can be under my name as EU citizen, delivered in Croatia but not imported (i.e. not hit by VAT)
2. If above doesn’t work, can the boat be in her name (US), take delivery in Croatia and not get hit by VAT on customs?

We’re pretty confused and still researching if flying US or something like Cayman Islands flag would be a better choice. If you have any good attorney contacts, or anyone who knows how to deal with this situation - that’d be highly appreciated.
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Old 19-02-2020, 14:26   #2
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Re: Avoiding VAT on European delivery?

Suggest you US flag and put the boat in her name. The boat can stay in the eu for circa 18 months without paying VAT.
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Old 19-02-2020, 15:06   #3
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Location: Santa Cruz
Boat: Boatless Again
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Re: Avoiding VAT on European delivery?

If your fiance is a US resident, she should be not have to pay VAT for her boat as long as it leaves the EU within 18 months.

As far as US taxes are concerned, there is a federal import tax, but it is 1.5% when you hit a US port--a lot lower than VAT in the EU. There can be sales taxes imposed by the state you use as a home port, but its possible to avoid these if you can prove that the boat is used out of the state for several years before you bring it home.

My advice is worth what you paid for it. If its a high dollar boat, you should consult two boat customs experts, on EU and one US.
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