Question about selling an imported yacht and VAT

[jshukis]

I intend to get a legal opinion if this gets serious, but I'd appreciate some real-world input now, if only for planning purposes:

As someone with EU+US dual citizenship, currently residing in the US, I am allowed to live in the EU should I so desire. Nice.

If I transfer my residence to the EU, I should have the ability to "import" my current yacht without paying VAT. It's called "transfer of residency relief".

So here's the question: If I sail to the EU, transfer residency, and import the boat, and then decide to sell the boat in the EU, will it be considered "tax paid" to the purchaser? That would be a considerably advantage to me.

And then the follow-on question: I paid sales tax on my current yacht. If I decided instead to buy a new boat in a low or no sales tax US state, or via offshore delivery, keep it for the time period required, and then run through the EU cruise/transfer of residency/import process as above, would this yacht be considered tax paid if I sold it in the EU?

VAT on a $250K boat is at least $50K, which would make my used boat considerably more valuable in the EU than a non tax-paid boat.

[Tellus]

Hi Mate,

your quests are diff to answer, but I´ll try to give you a sight.

First look here: HM Revenue & Customs

Your Beneteau is build in EU so got CE conform papers, but suppose with US flag.
Not your passport is important but the flag. If you want to sell it you have to pay VAT if it comes into EU. It´s hard to sell a boat without tax bill in EU.

Any maritime product in EU must be CE conform. It´s not possible to import a product like yacht, electronic, engine whatever from outside EU without it.
Don´t forget: EU is not a borderless union, notably if you´ll come from sea.
The more some countries suffer, the more they look for money.

[goboatingnow]

Originally Posted by Tellus

Hi Mate,

your quests are diff to answer, but I´ll try to give you a sight.

First look here: HM Revenue & Customs

Your Beneteau is build in EU so got CE conform papers, but suppose with US flag.
Not your passport is important but the flag. If you want to sell it you have to pay VAT if it comes into EU. It´s hard to sell a boat without tax bill in EU.

Any maritime product in EU must be CE conform. It´s not possible to import a product like yacht, electronic, engine whatever from outside EU without it.
Don´t forget: EU is not a borderless union, notably if you´ll come from sea.
The more some countries suffer, the more they look for money.

Ok ignore all that

Here's the beef

(A) yes under TOR your possessions can be imported free of vat . They must meet the criteria as regards length of time you own them.

You can sail to the EU, use TIR ( temporary import relief) initially to avoid Vat. As you establish your EU tax residency ( and domicile ) fill out the forms and go through the TOR process. Your assets will be " deemed VAT paid " and you will have documents from customs to back it up. No further vat is due to you or any EU buyer

(B) yes you can do it on a new US purchased yacht , as long as you comply with TOR ( 6 months ) and the same thing applies

You must keep them ( the boat ) for a minimum of 12 months after TOR

(C) CE if its not already CE marked , ie meets the RCD directive , then you will need to do post construction CE survey and MAY have to change a few things. But RCD compliance checking is non existent in the EU, but a EU buyer will want it. ( you don't need it to import the boat, once its your personal possession ) . Best buy a common EU centric boat, but remember boat market is fairly depressed, but the EU economy is recovering and if your looking at 2 years plus , it might be a good angle


NOTE the flag of the vessel is utterly irrelevsnt for vat and import law, its your status as the " beneficial " owner that's important.

Ensure you complete TOR before tax residency ( ie within 6 months )

Yes its a good deal especially on a nearly new boat ,as you'll get to put the vat uplift into your pocket. For older 2nds , vat isnt a factor as its depreciated out of the value.

Note there is also a good market in non vat boats in the EU. , ( commercial , leasing setups, sailing schools) often makes the base price of a 2nd hand non vat yacht better. ( but you need to be vat registered to sell it plus vat , but this could be worth doing )

Its a great Union really


Ps. You will be relieved of import duties and vat. Local boat taxes etc will continue to apply , ie whatever the relevant EU country forces its occupants to do regarding boats.

Dave

[wraaski]

hi I read this on Noonsite.com — Noonsite , and i don't understand, what it means

Spain: For VAT purposes, the country does not include the Canary Islands, Ceuta and Melilla.

It has also been reported (October 2013) that if choosing to import your boat into Europe in Spain, the valuation of the boat is based on the "blue book" price (or if your boat is not listed, then listed sale price of your model boat or similar found on the internet).The procedure is then to take 10% of that price and charge VAT/IVA on that. So for example, if your boat is valued at $50,000 then you pay VAT/IVA on $5,000.

[Pete7]

That looks cheap, you might want to have a read of the Spanish Govs tax website. Check out any registration costs too, there was a post on here about it a while back.

Tax Agency - Home

The UK have an extra little weeze to catch you out, they charge import duty, plus VAT on import duty, plus VAT on delivery costs. So if you paid $10,000 in shipping costs they will take you for 20% of that as well as the import duty + VAT. No idea how they work it out if a yacht sails across.

Pete