Buying a VAT UNPAID Boat in Greece - Advice Please

[Trinity Wildcat]

Hi Guys
Looking for some advice please - I am aware that there are MANY threads regarding VAT on this forum, but despite having searched what seems like hundreds of these I cannot find the info I need...

I have made an offer on a boat which is currently moored in Greece - this has been accepted and I want to know whether I should move forward with the purchase. The boat is owned by a Romanian company, is registered/flagged in Romania and is advertised as VAT UNPAID.

I am a UK citizen & tax resident. I would be buying the boat as a private individual for my own family use only. If I buy this boat I intend to register it on the UK SSR. The boat would never come to the UK - I would use it to travel around the Mediterranean for some months at least.

I am aware of the 90/180 rules - this would not present a problem for my plans.

I understand that I could buy the boat in the EU from a private individual and not pay VAT on the purchase price, but following some info I read on a thread on this forum I now have a couple of questions:

1. Would the actual sale/completion have to take place OUTSIDE EU customs territory to be free from VAT ? Would this mean simply taking possession of the boat in e.g. Turkey?
2. Does the fact that the boat is owned/being sold by a company in Romania complicate matter further with regards to VAT?

Apologies for being so long-winded - I would be grateful for your knowledge/experience.

[Joh.Ghurt]

Romania is part of the EU, so it's the same as if you bought it from a Greek.
If you buy it from a company, you have to get an invoice stating the VAT. Companies inside Europe are not allowed to sell to consumers without VAT. However - as a non-resident - you can export the boat from the Eurozone and get the VAT back from the company. Some companies trust you enough to bring the paperwork that they don't charge you the VAT first to refund it later. That's as far as the theory goes in a simplified manner.

In practice, it's best to have the sale being done outside the EU and then do a regular temporary import (for 18 months) once your boat is flagged British. To circumvents all annoying questions you could sail the boat over - still in the sellers name - to Turkey / Montenegro / whatever, then pull out the sales contract with the correct location, change the registration and come back legally - now in your own boat - with the new flag. The seller doesn't need to charge VAT because the transaction wasn't in the EU, you don't have to produce proof of export and you'd have need to leave the EU waters anywy, if only for a day to start the proper temporary import.

The 90/180 rule is of no importance for the boat, it only matters to tourist on the boat needing a Schengen-visa.

[goboatingnow]

The previous piece is quite frankly misleading

As a U.K. citizen you are entitled to buy a vat free boat in Europe and avail of the TIP procedure. This will then allow you to keep the boat in the EU for 18 months , you’ll need to remove it for 1 day outside the EU to reset the “ VAT clock “

There is absolutely no requirement to exercise the deal outside the EU. In theory you are supposed to immediately export the vessel and reimport it but in reality none looks at that. One presumes your U.K. address will be on the sales paperwork. That’s sufficient.

There is absolutely no legal requirement for a sale to have to have vat added , there are many legal circumstances where an eu citizen or a foreigner can buy a vat free boat.

Hence you are completely free to complete the sale in Greece and take advantage of the TIP.

Note the TIP is not based on any flag registration , it’s a function of the tax residency of the “ beneficial owner “ you can flag the boat under any legal flag you like.

Note the responsibility of vat compliance rests with the seller in a sale not the purchaser.

If you sail around while the registration is ongoing , simply bring the bill of sake with you to show its in your name. Again there is NO requirement to have the vessel registers in the U.K. to avail of TIP.

You’re very unlikely to be queried anyway.

[Joh.Ghurt]

Originally Posted by goboatingnow

There is absolutely no legal requirement for a sale to have to have vat added , there are many legal circumstances where an eu citizen or a foreigner can buy a vat free boat.

Could you please cite an example when a EU tax resident (consumer, not company) is allowed to buy a boat from an EU company (not another consumer) without VAT added?

[Trinity Wildcat]

Thanks for taking the time to reply, guys - I very much appreciate your assistance with this matter. As a result of the information you provided, I have just spoken with the seller - he has confirmed that there will be no VAT payable on the sale. Thanks again.

[goboatingnow]

Originally Posted by Joh.Ghurt

Could you please cite an example when a EU tax resident (consumer, not company) is allowed to buy a boat from an EU company (not another consumer) without VAT added?

(a) where export is intended , EU VAT law allows a period of time where the goods can then be exported. VAT is not paid in that case. (b) In the case of where a registered freight hauler is used ( ie a boat transport company) that is taking the boat to another EU country , again no VAT is paid at that point as the haulier is the importer and will resolve VAT in the destination country.

(a) rests on teh seller being comfortable with your bonefides , but I have done exactly that in France for example and I then paid the VAT as an importer in Ireland ( in fact this is VAT law for New boats , you pay VAT in the country of destination not the country of sale)



The UK for example pre Brexit had this codified into a format that the buyer did not pay VAT as long as export documentation was remitted within 30 days

Again VAT compliance on a sale rests with the seller not the buyer, VAT compliance on import resets with the importer

[goboatingnow]

Originally Posted by Trinity Wildcat

Thanks for taking the time to reply, guys - I very much appreciate your assistance with this matter. As a result of the information you provided, I have just spoken with the seller - he has confirmed that there will be no VAT payable on the sale. Thanks again.

Your welcome, the seller is entirely correct , Note that an update to the TIP directive requiring an "oral application" , ie you fill in a form , is wending its way across the EU , this is a good thing as to date there was no paperwork associated with the boat TIP process and hence nothing to show other EU countries

[EdenRose]

Originally Posted by goboatingnow

Your welcome, the seller is entirely correct , Note that an update to the TIP directive requiring an "oral application" , ie you fill in a form , is wending its way across the EU , this is a good thing as to date there was no paperwork associated with the boat TIP process and hence nothing to show other EU countries

You seem to know a lot about this....please advise on this scenerio

1. New boat purchase in EU...No Vat Paid
2. Buyer is not EU resident and yacht will be flagged not EU
3. Are you eligible for TI immediately at sale and possession or do you have to leave and come back into the EU?
4. Do you get the same 18 months from purchase or only after return? If you do not get the 18 month from purchase how long do you have to leave after official purchase and transfer to avoid VAT?

Thank you.