Length of stay in the EU

[Xyacht]

Hoping someone can help us with this issue or guide us to a site.
We are US citizens. We purchased our used boat in Germany. We paid our down payment prior to Covid-19. Final payment was due when Covid shut down all borders.
Our bill of sale is dated June 2020 along with Cayman Island registry
VAT on the purchase was paid.
Boat was moved from Germany to the Netherlands for a few upgrades in fall of 2020 (by the seller)
The borders finally opened in June 2021 and we arrived in the Netherlands to move our boat to the UK in August 2021
After arrival in the Netherlands we discovered we had fuel tank issues and hydraulic issues which made us postpone the trip until these issues could be resolved. (Repairs were delayed due to parts availability and Covid)
So these repairs were not completed until May 2022
We arrived back in the Netherlands in June 2022 and are now concerned about overstaying our 18 month window for non EU residents
Some people tell us to not worry about it—we are fine, others say we have to pay VAT again.
Can someone please clarify the rules and how they apply to boats having work done vs vacationing? Also how does the Covid shutdown affect our 18 month window??
Thanks for any help!!

[boatman61]

You should only have to pay VAT once... if the boat has not left the territory of the EU then no further VAT is due.
It is not governed by the 18mth rule.

[Xyacht]

Thanks for your reply!
So the 18 month rule doesn’t apply to us
What exactly is the 18 month rule—applies to people and not the boat?

[SV Tom Crean]

18 month rule applies for foreign owned non vat paid boats in the EU (think I got that right). Its about tax and not people.

The Schengen rule applies to humans and not the boat.

[boatman61]

The 18mth rule applies to non EU vessels on which no VAT has been paid.. if for example you had sailed said boat across from the USA pre Covid then been forced by circumstance to leave it there for more than 18mths then VAT would be liable.
Even then as I understand it is possible to have it hauled and custom bonded till you could return to collect it.. in which case I understand you have a time period in which to remove it from the territory before returning under the 18mth rule.
Better brains than mine will either confirm or refute the bonding process.
If you are planning on taking the boat out of EU waters to the UK then it's my understanding you will then fall under the 18mth rule on return to EU waters, or pay the VAT again.
For you as people, you come under the 90 days in every 180 days rule.. 3 months in 3 months out.
No chance is missed to get revenue..

[Sun and Moon]

Originally Posted by boatman61

The 18mth rule applies to non EU vessels on which no VAT has been paid.. if for example you had sailed said boat across from the USA pre Covid then been forced by circumstance to leave it there for more than 18mths then VAT would be liable.
Even then as I understand it is possible to have it hauled and custom bonded till you could return to collect it.. in which case I understand you have a time period in which to remove it from the territory before returning under the 18mth rule.
Better brains than mine will either confirm or refute the bonding process.
If you are planning on taking the boat out of EU waters to the UK then it's my understanding you will then fall under the 18mth rule on return to EU waters, or pay the VAT again.
For you as people, you come under the 90 days in every 180 days rule.. 3 months in 3 months out.
No chance is missed to get revenue..

What Boatman is saying, which I believe is correct, is that you need to be careful about how much time you spend out of EU, not in. Once VAT is paid, if you leave the EU for too much time, VAT will need to be paid again. EU nationals circumnavigating do not run into this because the boat is their home, and when you move into the EU you can basically bring whatever you want. But as Americans, you will not have this luxury. When you reenter, you will need to leave again within 18 months or else face VAT again. Not sure what the allowed length of time out is, but 18 months is a good guess.

[valhalla360]

Originally Posted by Xyacht

Our bill of sale is dated June 2020 along with Cayman Island registry
VAT on the purchase was paid.

Just to clarify, these are two separate statements? There is no period after the first line. Correct punctuation may change the answer.

If it's EU VAT paid, as others have said, the boat can stay forever.
If it's Cayman Island VAT paid, you are under the 18month rule.

[goboatingnow]

the definitive position is

1 EU VAT paid , boat can remain within EU waters permanently

2. If owned by non EU residents , the minute you sail out of EU customs union waters the boat is exported and will therefore reenter under the 18 month temporary process. The U.K. cruising association are trying to change this but this is the vat law at present

3.EU residents don’t suffer (2) as they are entitled to to RGR (returned goods relief ) for upto three years (extendable indefinitely by agreement ) . Non eu residents don’t have RGR rights and rule (2) applies. There is no grace period.

Note however that oversight of (2) is very limited if you don’t tell they won’t ask

[goboatingnow]

Originally Posted by boatman61

The 18mth rule applies to non EU vessels on which no VAT has been paid.. if for example you had sailed said boat across from the USA pre Covid then been forced by circumstance to leave it there for more than 18mths then VAT would be liable.
Even then as I understand it is possible to have it hauled and custom bonded till you could return to collect it.. in which case I understand you have a time period in which to remove it from the territory before returning under the 18mth rule.
Better brains than mine will either confirm or refute the bonding process.
If you are planning on taking the boat out of EU waters to the UK then it's my understanding you will then fall under the 18mth rule on return to EU waters, or pay the VAT again.
For you as people, you come under the 90 days in every 180 days rule.. 3 months in 3 months out.
No chance is missed to get revenue..

A court case in Sicily is being adjudicated next week , essentially a bond is local to the country but the TIP is EU wide , Italy is attempting to secure VAT on a super yacht that was bonded in Spain for Covid , Spain allowed the 5 month overstay ( post 18 month ) but Italy has contended that no part of EU VAT law but local to Spain.( she pulled into Sicily as she had a mechanical fault and was arrested ) I know the captain

[boatman61]

Originally Posted by goboatingnow

A court case in Sicily is being adjudicated next week , essentially a bond is local to the country but the TIP is EU wide , Italy is attempting to secure VAT on a super yacht that was bonded in Spain for Covid , Spain allowed the 5 month overstay ( post 18 month ) but Italy has contended that no part of EU VAT law but local to Spain.( she pulled into Sicily as she had a mechanical fault and was arrested ) I know the captain

Comes under the.. 'No chance to grab revenues missed' heading methinks...
Pity the Skipper did not think to make a detour to Morocco or Mellia to reset the clock.

[valhalla360]

Originally Posted by boatman61

Comes under the.. 'No chance to grab revenues missed' heading methinks...
Pity the Skipper did not think to make a detour to Morocco or Mellia to reset the clock.

Of course, the tax alone on a superyacht may be more than your average 35-45ft cruising boat costs.

[goboatingnow]

Originally Posted by valhalla360

Of course, the tax alone on a superyacht may be more than your average 35-45ft cruising boat costs.

Yes but it’s likely to set a precedent for anyone considering “ bonding “ a yacht and hence exceeding the 18 month limit. Clearly your safest option is once out of bond , to sail directly to a non EU port.

[Anders]

Originally Posted by Xyacht

Hoping someone can help us with this issue or guide us to a site.
We are US citizens. We purchased our used boat in Germany. We paid our down payment prior to Covid-19. Final payment was due when Covid shut down all borders.
Our bill of sale is dated June 2020 along with Cayman Island registry
VAT on the purchase was paid.
Boat was moved from Germany to the Netherlands for a few upgrades in fall of 2020 (by the seller)
The borders finally opened in June 2021 and we arrived in the Netherlands to move our boat to the UK in August 2021
After arrival in the Netherlands we discovered we had fuel tank issues and hydraulic issues which made us postpone the trip until these issues could be resolved. (Repairs were delayed due to parts availability and Covid)
So these repairs were not completed until May 2022
We arrived back in the Netherlands in June 2022 and are now concerned about overstaying our 18 month window for non EU residents
Some people tell us to not worry about it—we are fine, others say we have to pay VAT again.
Can someone please clarify the rules and how they apply to boats having work done vs vacationing? Also how does the Covid shutdown affect our 18 month window??
Thanks for any help!!

Why did you pay VAT? VAT is only due on import or if you buy from a company.