EU boat reregistered outside EU can it stay in the EU tax free?

[Pete7]

Originally Posted by CatNewBee

TAs EU citizen and owner you must be able to provide an original (not a copy) invoice with VAT statement, then you are fine .

Oh that is another can of worms. How many old boats still have the original purchase paperwork to show VAT payments? By chance I have and it amounts to about 20 different documents as stage payments were made and extras ordered during the build.

Sadly there are many boats that don't have this paperwork so it is doubtful any EU country could insist on a wide spread check because so many would fail, particularly if they have changed hands a few times over the years.

Newish boats? well it would only take a bored or new to the job customs officer to ask a few questions to make the owner squirm.


Pete

[CatNewBee]

It is not necessary to have the first one, you have to have one with VAT on it, it could be the invoice from a purchase of a used boat from a charter company and then VAT payment to the authorities in that country based on the deducted price for the used boat.

It has to be a paper, where the seller and buyer and the CIN of the boat is printed and that states the ex-tax price, the VAT amount and the total price paid - that's all. It must be an original document, not a copy.

It can also be a document from the TAX authorities of an EU country, if the tax was paid later down the owners chain or during an import from outside of the EU.

Otherwise the vessel will be estimated by the authorities or a survey regarding its value and you have to pay the VAT based on this value - again.

[CatNewBee]

Originally Posted by nwdiver

If a Canadian bought a EU used boat, VAT paid and registered in Canada (I know the Canadian issues) can it stay in the EU without paying taxes as the VAT has been paid?

A Canadian citizen is not subject to EU VAT, in fact the VAT paid for a new vessel can be refunded when the vessel leaves EU waters (duty free shopping) or the vessel gets a temporary status for the immediate export and the VAT is not collected at all.

He can leave the boat legally up to 18 months in EU waters without paying import taxes or the VAT. He can sail to an Non-EU country for a few days and re-enter the EU waters for another 18 months. etc. His Visa (usually up to 6 months during a time period of one year) might not be good for 18 months - it is not connected to the status of the vessel.

[nwdiver]

Originally Posted by CatNewBee

A Canadian citizen is not subject to EU VAT, in fact the VAT paid for a new vessel can be refunded when the vessel leaves EU waters (duty free shopping) or the vessel gets a temporary status for the immediate export and the VAT is not collected at all.

He can leave the boat legally up to 18 months in EU waters without paying import taxes or the VAT. He can sail to an Non-EU country for a few days and re-enter the EU waters for another 18 months. etc. His Visa (usually up to 6 months during a time period of one year) might not be good for 18 months - it is not connected to the status of the vessel.

Yes I understand this, I want to park the boat in the EU and visit it not move it along..........

[crankysailor]

Originally Posted by CatNewBee

The EU VAT applies only to Owners who are EU Citizens and sail with the vessel in EU waters.

I think this is a bit misleading. I have been researching this the last few days and I believe it is actually irrelevant if the owner is an EU citizen or not. If you bring a yacht into the EU, you have to pay VAT on it. I quote:

https://www.gov.uk/government/public...nd-from-the-uk

3.5 Can a vessel lose its VAT paid status?
VAT is due on the importation of any vessel from outside the EU. However, there are provisions for this VAT to be relieved when an EU VAT paid vessel returns to the EU, please read paragraph 3.4. If an EU VAT paid vessel leaves the EU, and whilst outside the EU it is sold, the new owner will, unless eligible for one of the reliefs described in this Notice, be liable to pay VAT if the vessel is brought back into the EU.

Now, there are provisions to relieve you from it like it says above if you are not an EU resident (note I didn't say a EU citizen) and only bringing the boat "temporarily" into the EU (the 18 months rule) or if the owner didn't change etc...

5.3 What is the period of relief for non EU residents?
Private use by a non EU resident can be for up to 18 months. However, if the vessel has been rehired by an EU hire service to a non EU resident for private use, the vessel must be re-exported outside the EU within 8 days of the hire.


If you are Canadian, and enter the EU and leave the boat here for longer than 18 months then at least in theory, you will be asked to shell out the VAT. If this really happens or not I dunno.

And finally, regarding "schemes" to avoid taxes...

4.4 VAT Avoidance Schemes
HMRC are aware that VAT avoidance schemes are marketed in the pleasure craft sector. The schemes typically involve artificial leasing or chartering arrangements under which the user acquires a new pleasure craft which is claimed to have ‘VAT paid’ status while, in reality, paying no VAT (or a minimal amount of VAT).

If there is evidence to suggest a vessel has been purchased through such a scheme, HMRC may investigate with a view to recovering any unpaid VAT. It is also possible that interest and penalties may be charged in relation to any unpaid VAT.

If you are purchasing a used pleasure craft which has previously been subject to a leasing or chartering arrangement you should be alert to the possibility that it might have been supplied through a VAT avoidance scheme.

Like someone said.. things might vary depending on the EU country.. this is just something I got from the UK site above.. YMMV.. the usual disclaimers apply (if you take legal advice from random people on the Internet, it is your own damn fault, etc )

[crankysailor]

Originally Posted by CatNewBee

A Canadian citizen is not subject to EU VAT, in fact the VAT paid for a new vessel can be refunded when the vessel leaves EU waters (duty free shopping) or the vessel gets a temporary status for the immediate export and the VAT is not collected at all.

He can leave the boat legally up to 18 months in EU waters without paying import taxes or the VAT. He can sail to an Non-EU country for a few days and re-enter the EU waters for another 18 months. etc. His Visa (usually up to 6 months during a time period of one year) might not be good for 18 months - it is not connected to the status of the vessel.

As I said on my previous post.. that first sentence is misleading.. A canadian citizen IS subject to EU VAT.. but you can get out of it, as you say, if the boat is bought and you leave the EU immediately or the 18 months thing, etc, etc.. just gotta be careful how you interpret that first sentence

[valhalla360]

Originally Posted by CatNewBee

The EU VAT applies only to Owners who are EU Citizens and sail with the vessel in EU waters.

EU VAT applies to any boat imported into the EU regardless of the owner's citizenship. There is a temporary exemption for non-EU residents (note resident not citizen) of up to 18 months after which VAT is due though you can reset the 18 months by leaving the EU and can extend the 18 months by leaving the boat and putting it in bond with the authorities.

VAT paid means nothing except the VAT was paid in an EU country., Canadian VAT paid does not qualify for that status.

Agree Canadian VAT doesn't count if you import the boat to the EU.

As EU citizen and owner you must be able to provide an original (not a copy) invoice with VAT statement, then you are fine - or you register the boat to a company / business - than the VAT is refundable / deductible.

If you import a boat and pay EU VAT, it's not refundable.

If you leave EU waters for longer than 3 years you might lose the VAT status and have to re-import the vessel and pay the import taxes + VAT again.

This depends on the authorities: you can ask for a extension of that period due to necessary repairs, some authorities accept also the preservation of the VAT status, if the owner has not changed (the vessel was in the EU during and after the purchase, the owner sails for an extended period and returns to EU waters without re-selling the boat in the mean time).

This laws are differently interpreted and enforced in different countries. The EU law says 3 years maximum out side EU waters...

The VAT stuff is very complicated, especially because the entry port of the first EU country can claim the VAT and import taxes and not the country of the citizen, so some are really eager to squeeze money out and it is difficult to sue the authorities in a foreign country.

There are some serious mistakes in the first part of this.

[boatman61]

Originally Posted by CatNewBee

The EU VAT applies only to Owners who are EU Citizens and sail with the vessel in EU waters.

VAT paid means nothing except the VAT was paid in an EU country., Canadian VAT paid does not qualify for that status.

As EU citizen and owner you must be able to provide an original (not a copy) invoice with VAT statement, then you are fine - or you register the boat to a company / business - than the VAT is refundable / deductible.

If you leave EU waters for longer than 3 years you might lose the VAT status and have to re-import the vessel and pay the import taxes + VAT again.

This depends on the authorities: you can ask for a extension of that period due to necessary repairs, some authorities accept also the preservation of the VAT status, if the owner has not changed (the vessel was in the EU during and after the purchase, the owner sails for an extended period and returns to EU waters without re-selling the boat in the mean time).

This laws are differently interpreted and enforced in different countries. The EU law says 3 years maximum out side EU waters...

The VAT stuff is very complicated, especially because the entry port of the first EU country can claim the VAT and import taxes and not the country of the citizen, so some are really eager to squeeze money out and it is difficult to sue the authorities in a foreign country.

New boat a refund..
Secondhand.. In yer dreams..

[valhalla360]

Originally Posted by CatNewBee

It is not necessary to have the first one, you have to have one with VAT on it, it could be the invoice from a purchase of a used boat from a charter company and then VAT payment to the authorities in that country based on the deducted price for the used boat.

It has to be a paper, where the seller and buyer and the CIN of the boat is printed and that states the ex-tax price, the VAT amount and the total price paid - that's all. It must be an original document, not a copy.

It can also be a document from the TAX authorities of an EU country, if the tax was paid later down the owners chain or during an import from outside of the EU.

Otherwise the vessel will be estimated by the authorities or a survey regarding its value and you have to pay the VAT based on this value - again.

Getting a note from a prior owner (particularly not the one who paid the VAT), isn't going to help much if the authorities ask for proof of VAT paid. If they are not to serious about it they might let it slide but if they think they have you, they will ask for the original receipt from the tax authority. Otherwise, anyone can bring in a non-VAT paid boat, sell it and simply state on the bill of sale that it's VAT paid.

[valhalla360]

Originally Posted by boatman61

New boat a refund..
Secondhand.. In yer dreams..

Ah, that's what he was trying to say.

Yeah, if you buy a brand new boat and leave immediately, you can get a refund. There might be a month or so leeway but not long term.

Used boats, not a chance.

[boatman61]

Originally Posted by nwdiver

Yes I understand this, I want to park the boat in the EU and visit it not move it along..........

In that case you will get hit for import tax and local registration..
Cheap holiday home dreams wont work.

[nwdiver]

OK as usually most are missing the point entirely.........READ THE THREAD OR DONT ADD TO IT.......

if I buy a say 3 year old boat on Spain, that VAT has been paid during its purchase I need to reflag it.......I will register it as Canadian......... Got it so far?

Now the question, that has been sort of answered......can the boat stay in the EU indefinitely? That is the situation and question...........

[boatman61]

Originally Posted by nwdiver

OK as usually most are missing the point entirely.........READ THE THREAD OR DONT ADD TO IT.......

if I buy a say 3 year old boat on Spain, that VAT has been paid during its purchase I need to reflag it.......I will register it as Canadian......... Got it so far?

Now the question, that has been sort of answered......can the boat stay in the EU indefinitely? That is the situation and question...........

And you are missing the point.. theres more than VAT to consider.. if a Brit boat can be hit for import tax by Spanish authorities after 6 months sitting in a port what makes you think a Canadian flagged boat is immune..
VAT is not going to be the problem if its been paid by the original owner and has never left the EU.
And now I am outa here.. have fun.

[nwdiver]

The Spainish are ahead of the game........Brits will have no more rights to visit than us nonEU types, yes I understand that separate nations have different tax system, I will pick a jurisdiction that fits......

[valhalla360]

Originally Posted by nwdiver

The Spainish are ahead of the game........Brits will have no more rights to visit than us nonEU types, yes I understand that separate nations have different tax system, I will pick a jurisdiction that fits......

It has nothing to do with Brexit.

It could be a German boat in Spain and the same situation.