3 year pay UK VAT again on return!

[Sea Devil]

It looks like there is a 3-year re-importation rule - hope this is not the case!

Therefore, it may be worth looking at Customs Notice 8 which, I think, tells you that you need to have your yacht back in UK within 3 years or be liable to VAT on eventual return (it also notes various exemptions). In that notice, there is a link to Notice 236: Returned Goods Relief

Claiming relief for pleasure craft Notice 8: sailing your pleasure craft to and from the UK

Pleasure craft returning to the UK under this relief must complete a customs declaration and use customs procedure code 61 23 F01.

I am not clear if that all means that if we bring our cruising boats back to the UK having been away for over 3 years we have to pay VAT on them again?

If, If that is the case it is grossly unfair and wrong and I think it would be a good think for the RYA and CA to start lobbying the government to change this rule.. I am not a member of either but maybe others are?

Or I am misunderstanding this - dunno...

Michael

 

[Tranona]

There is nothing new in this - it dates from 1992! It is an EU VAT rule that has been carried over into UK law post Brexit. However, don't worry too much as there is an "exceptional circumstances" rider which in the past has resulted in only very limited (if any) enforcement for genuine cruisers. The RYA and CA (particularly) have been very active in liaising with HMRC over this. The main thing to note about the rule is that the "relief" is only available to the person who exported the boat from the UK. So OK for the typical long distance cruiser returning, but not for those who buy a boat while it is outside the UK. This will obviously affect many UK (and EU as the rules are the same there) owners who have boats located outside and want to sell without returning, as the buyer will have to pay VAT if they want to return it. OK if the buyer is non resident as they can get temporary admission, but not for residents.

You need to look very carefully at the rules in relation to the current status and location of your boat, your residence and your future plans if you are intending sailing outside either the EU or the UK and intend returning so that you are aware of how the available reliefs might affect you.

 

[Sea Devil]

There is nothing new in this - it dates from 1992! It is an EU VAT rule that has been carried over into UK law post Brexit. However, don't worry too much as there is an "exceptional circumstances" rider which in the past has resulted in only very limited (if any) enforcement for genuine cruisers. The RYA and CA (particularly) have been very active in liaising with HMRC over this. The main thing to note about the rule is that the "relief" is only available to the person who exported the boat from the UK. So OK for the typical long distance cruiser returning, but not for those who buy a boat while it is outside the UK. This will obviously affect many UK (and EU as the rules are the same there) owners who have boats located outside and want to sell without returning, as the buyer will have to pay VAT if they want to return it. OK if the buyer is non resident as they can get temporary admission, but not for residents.

You need to look very carefully at the rules in relation to the current status and location of your boat, your residence and your future plans if you are intending sailing outside either the EU or the UK and intend returning so that you are aware of how the available reliefs might affect you.

Thank you Tranona - you have clarified that for me and it seems reasonable!

 

[Graham376]

The main thing to note about the rule is that the "relief" is only available to the person who exported the boat from the UK. So OK for the typical long distance cruiser returning, but not for those who buy a boat while it is outside the UK. This will obviously affect many UK (and EU as the rules are the same there) owners who have boats located outside and want to sell without returning, as the buyer will have to pay VAT if they want to return it. OK if the buyer is non resident as they can get temporary admission, but not for residents.

Many of those who I've spoken to who have bought UK registered boats in the EU, have used the standard RYA form which doesn't stipulate the location of the boat at the point of sale so, who's to say it wasn't in the UK at the time?

 

[sailaboutvic]

Many of those who I've spoken to who have bought UK registered boats in the EU, have used the standard RYA form which doesn't stipulate the location of the boat at the point of sale so, who's to say it wasn't in the UK at the time?

My thinking in is , if the sh@t hit the fan and your are stopped bring the boat back to the UK , if the question was ask to prove where the boat was in the UK when the deal was done.
I won't be bring my boat back mostly because she not a weekend she a blue water cruiser and she be worth much more sold in the EU as EU vat status then a British VAT status.
I also belive anyone who wanted to bring an boat they brought in the EU would be very unlucky to have a problem.
After saying all that my experience talking to other bits is other then one couple we met no one as any plain given up their life style just to get the boat back within the time limit

 

[Tranona]

Many of those who I've spoken to who have bought UK registered boats in the EU, have used the standard RYA form which doesn't stipulate the location of the boat at the point of sale so, who's to say it wasn't in the UK at the time?

The point now is that Border Force and HMRC are likely to be much more active and making a declaration in theory compulsory for everybody including arriving from the EU so the chances of being interrogated are higher compared with the last 30 years or so when there were essentially no systematic checks. Don't forget it is a criminal offence to make a false declaration and avoid paying VAT - worth adding into your risk assessment!

 

[duncan_m]

We brought our boat back from the EU post Brexit. Here's what happened.

Once in UK waters, a border force boat came over for a chat as we passed Dover. They wanted to know who was on board and what our intentions were. I listed out who was onboard DOBs etc and told them where we were heading. They were mainly interested in whether we were British and if we were planning on working in the UK. I am and I do so no issues there. It was basically like going through passport control except it was freezing and over a VHF.

We called yacht line as is now required. Yacht line deal with a host of different things so you get an operator reading off a checklist that submits/creates a ticket (always get the ticket number for your logbook, it's a handy reference for later). They asked us a handful of questions including whether we had any firearms onboard and if tax was paid, it was and then cleared us to drop Q. No other checks.

There are no longer customs officials from HMRC hiding in most marinas or ports in the UK. They have been replaced by angry signs saying you shouldn't land pets and to call yachtline. In Poole for example the customs house is now a coffee shop. I'm sure most others are of similar use.

It's a criminal offence to misreport the info as above. However, I suspect that it would be unlikely despite the best efforts of the press and everyone's worst fears to hear anything more about your entry into the UK.

If you did it's because you came in on a non-UK boat. It's border force again and they'd like to see your passports please and did you call yacht line. Yes sir here's our reference, they don't have access to the system but can always call up. Not to inspect your tax status and read through your detailed log to see where you were or weren't on B-day that's HMRC's job.

If for some reason you're exceptionally worried and want to phone HMRC to make an import declaration you'll find they have no idea who you are and you're starting from scratch again.

 

[Lightwave395]

We brought our boat back from the EU post Brexit. Here's what happened.

Once in UK waters, a border force boat came over for a chat as we passed Dover. They wanted to know who was on board and what our intentions were. I listed out who was onboard DOBs etc and told them where we were heading. They were mainly interested in whether we were British and if we were planning on working in the UK. I am and I do so no issues there. It was basically like going through passport control except it was freezing and over a VHF.

We called yacht line as is now required. Yacht line deal with a host of different things so you get an operator reading off a checklist that submits/creates a ticket (always get the ticket number for your logbook, it's a handy reference for later). They asked us a handful of questions including whether we had any firearms onboard and if tax was paid, it was and then cleared us to drop Q. No other checks.

There are no longer customs officials from HMRC hiding in most marinas or ports in the UK. They have been replaced by angry signs saying you shouldn't land pets and to call yachtline. In Poole for example the customs house is now a coffee shop. I'm sure most others are of similar use.

It's a criminal offence to misreport the info as above. However, I suspect that it would be unlikely despite the best efforts of the press and everyone's worst fears to hear anything more about your entry into the UK.

If you did it's because you came in on a non-UK boat. It's border force again and they'd like to see your passports please and did you call yacht line. Yes sir here's our reference, they don't have access to the system but can always call up. Not to inspect your tax status and read through your detailed log to see where you were or weren't on B-day that's HMRC's job.

If for some reason you're exceptionally worried and want to phone HMRC to make an import declaration you'll find they have no idea who you are and you're starting from scratch again.

You haven't said where you came from ? How did you get on 'checking out' and getting your passports stamped of whatever EU country you last left ? I'll be bringing a boat back from France in May, neither Brest nor Roscoff marinas, despite their best efforts at being helpful, are able to tell me how I get an exit stamp.
I've sent an email to the French embassy more in hope than expectation...

 

[duncan_m]

We came from the Netherlands. Do you mean an exit stamp in your passport or something else?

If so then I think you might struggle. As long as you have proof i.e. a logbook you've exited the Schengen area and if you've tried customs in Roscoff and they can't help and you've got an email or a note in your log of who you talked to I think you're ok.

We didn't do any exit procedures leaving NL it would have meant a trip to Rotterdam and I didn't have time. Just sailed back.

You might be able to get it in a main port like Roscoff but if no joy there then not sure. I've never found customs in northern France to be too interested.

 

[duncan_m]

I was going to add. If your boat was in FR for B-day they'll consider the boat as EU VAT paid so from an import/export perspective you don't need to worry about paperwork. Just keep your marina receipt in your logbook.

 

[Chris_Robb]

The point now is that Border Force and HMRC are likely to be much more active and making a declaration in theory compulsory for everybody including arriving from the EU so the chances of being interrogated are higher compared with the last 30 years or so when there were essentially no systematic checks. Don't forget it is a criminal offence to make a false declaration and avoid paying VAT - worth adding into your risk assessment!

There is nothing new in this - it dates from 1992! It is an EU VAT rule that has been carried over into UK law post Brexit. However, don't worry too much as there is an "exceptional circumstances" rider which in the past has resulted in only very limited (if any) enforcement for genuine cruisers. The RYA and CA (particularly) have been very active in liaising with HMRC over this. The main thing to note about the rule is that the "relief" is only available to the person who exported the boat from the UK. So OK for the typical long distance cruiser returning, but not for those who buy a boat while it is outside the UK. This will obviously affect many UK (and EU as the rules are the same there) owners who have boats located outside and want to sell without returning, as the buyer will have to pay VAT if they want to return it. OK if the buyer is non resident as they can get temporary admission, but not for residents.

You need to look very carefully at the rules in relation to the current status and location of your boat, your residence and your future plans if you are intending sailing outside either the EU or the UK and intend returning so that you are aware of how the available reliefs might affect you.

I just received from HMRC a copy of the latest RGR rules - sect 37. In this it quotes Yachts Transported to the EU and remaining in the EU after TP. This the reason for HMRC saying that no one who bought a UK VAT Paid yachts 2nd Hand in Europe can return using RGR.
BUT
They have omitted to amend s.121D of the VAT Regs 2020 which says specifically (subsection (2)) that the goods must be reimported into GB by the same person who originally exported the goods. It seems they havent mentioned Transported which rather blows that out of the water. I have done 10 emails to them each with an answer querying their stance on the above. I demanded that they show me where the change ion the law was for "Transported". Their answer was the above - which actually proves they are wrong. I am in a bit of a dilema - do I go back and say they cocked up the law?! - which they clearly have.

So anyone who bought a second hand yachts in europe (of any EU Vat type) can legitimately say it was exported from the EU on the end of TP. I have that in writing from them. But actually if its still in the EU you have not yet exported it from the EU - but you have from the UK. So you can stay or you can return - and you can have your cake and eat it either way!

 

[sailaboutvic]

I just received from HMRC a copy of the latest RGR rules - sect 37. In this it quotes Yachts Transported to the EU and remaining in the EU after TP. This the reason for HMRC saying that no one who bought a UK VAT Paid yachts 2nd Hand in Europe can return using RGR.
BUT
They have omitted to amend s.121D of the VAT Regs 2020 which says specifically (subsection (2)) that the goods must be reimported into GB by the same person who originally exported the goods. It seems they havent mentioned Transported which rather blows that out of the water. I have done 10 emails to them each with an answer querying their stance on the above. I demanded that they show me where the change ion the law was for "Transported". Their answer was the above - which actually proves they are wrong. I am in a bit of a dilema - do I go back and say they cocked up the law?! - which they clearly have.

So anyone who bought a second hand yachts in europe (of any EU Vat type) can legitimately say it was exported from the EU on the end of TP. I have that in writing from them. But actually if its still in the EU you have not yet exported it from the EU - but you have from the UK. So you can stay or you can return - and you can have your cake and eat it either way!

Chris you have my ears ,
If what you say is correct please leave it be , it give many of us a loop hole if we want to bring our boats back . Poking this bear may shut the back door ,
Good fine mate .

 

[Gibeltarik]

Agree - stop poking the bear - a useful opportunity for some.

 

[Chris_Robb]

Chris you have my ears ,
If what you say is correct please leave it be , it give many of us a loop hole if we want to bring our boats back . Poking this bear may shut the back door ,
Good fine mate .

My instinct is to leave alone. I will see what the CA wants to do and express these concerns.

 

[webcraft]

How do they calculate the vat for old boats? Our boat cost £3,500

(Not that we are currently planning to return her)

- W

 

[Gibeltarik]

How do they calculate the vat for old boats? Our boat cost £3,500

(Not that we are currently planning to return her)

- W

HMRC expect you to declare the market value of your boat - and argue from there! They remain silent so far on VAT on boats built before VAT was invented - it has been suggested that they should be zero-rated..............

 

[Rappey]

that the goods must be reimported into GB by the same person who originally exported the goods. It seems they havent mentioned Transported

Surely that's no different to you sailing it from the uk and back. Your still the owner and have arranged to get it transported, and back ?

 

[sailaboutvic]

Surely that's no different to you sailing it from the uk and back. Your still the owner and have arranged to get it transported, and back ?

Point being made is the rule only apply if the original owner sailed it back , ie not if you brought the boat in the EU and sailed it back .

 

[Shaddickp]

There's a useful summary here:
Collaboration between leading leisure marine representative bodies yields positive confirmation on post-Brexit VAT interpretation

 

[syvictoria]

We came from the Netherlands. Do you mean an exit stamp in your passport or something else?

If so then I think you might struggle. As long as you have proof i.e. a logbook you've exited the Schengen area and if you've tried customs in Roscoff and they can't help and you've got an email or a note in your log of who you talked to I think you're ok.

We didn't do any exit procedures leaving NL it would have meant a trip to Rotterdam and I didn't have time. Just sailed back.

You might be able to get it in a main port like Roscoff but if no joy there then not sure. I've never found customs in northern France to be too interested.

It will be extremely interesting to see how this works out in practise (I hope it works out well for you). For example, if your next trip into the EU is via plane to some sunny beach resort in 3+ months time, will the airport border control be willing to accept a note in your log, and will you indeed have your log with you!? Or will you simply ping up on the computer as having previously overstayed your 90 days? Time will tell, and we can only assume/hope that common sense will prevail, at least in the early days.