Another VAT conundrum ?

[Irish Rover]

I've lost track. Is the person we are speaking about resident in the Uk or the EU?

If they are EU resident, could they claim UK RGR?

I don't know where he resides.
Residency is not an issue for RGR but it is for TA.

 

[Tranona]

I wonder what the panel's view would be if looking again at my post, but stating that the VAT was actually paid in the EU (Azores), not UK originally so the boat actually has an EU VAT certificate.

So it has a Portuguese VAT certificate along with proof that it was in the EU on 31/12/20

Kind of jumping back to your original statement about the status of your boat. Would I be right in saying that you bought it new and exported it under the personal export scheme at the time or bought it outside the EU non VAT paid? In which case when you paid VAT in the Azores it became VAT paid. Then when you sailed it to UK there was no need for RGR because you were sailing from one EU state to another. In just the same way as when I sailed my Greek VAT paid boat to Spain and then by road to UK. All the time you had it in the UK it was an EU boat and you could move it freely - including taking it out of the EU and coming back to the UK under RGR.

The situation now is that you have a boat with VAT paid in Portugal and located in France on 31/12. I am not sure that it having spent some time in the UK in the past makes it eligible for RGR into UK.

Rather than speculate, suggest that you contact HMRC at the address in No8 for advice. If you do want it to be seen as UK VAT paid then It would be wise to have this in writing to avoid potential difficulties when you come to sell. Otherwise your buyer is going to see a Portuguese VAT receipt and evidence that it was in the EU on 31/12 and therefore potentially liable for VAT in the UK.

 

[Bobc]

Kind of jumping back to your original statement about the status of your boat. Would I be right in saying that you bought it new and exported it under the personal export scheme at the time or bought it outside the EU non VAT paid? In which case when you paid VAT in the Azores it became VAT paid. Then when you sailed it to UK there was no need for RGR because you were sailing from one EU state to another. In just the same way as when I sailed my Greek VAT paid boat to Spain and then by road to UK. All the time you had it in the UK it was an EU boat and you could move it freely - including taking it out of the EU and coming back to the UK under RGR.

The situation now is that you have a boat with VAT paid in Portugal and located in France on 31/12. I am not sure that it having spent some time in the UK in the past makes it eligible for RGR into UK.

Rather than speculate, suggest that you contact HMRC at the address in No8 for advice. If you do want it to be seen as UK VAT paid then It would be wise to have this in writing to avoid potential difficulties when you come to sell. Otherwise your buyer is going to see a Portuguese VAT receipt and evidence that it was in the EU on 31/12 and therefore potentially liable for VAT in the UK.

Thanks Tranona. Top bit you are quite correct about, except that it was delivered directly to the BVI from the factory, so no VAT was initially paid anywhere.

No intention of bringing it back to the UK, but more just being curious on the collective thoughts.

Coming back to the OP - sounds like if you bring your boat back to the UK, even for a short period, you will have to claim RGR and will lose your boat's EU Vat status.

 

[Irish Rover]

Kind of jumping back to your original statement about the status of your boat. Would I be right in saying that you bought it new and exported it under the personal export scheme at the time or bought it outside the EU non VAT paid? In which case when you paid VAT in the Azores it became VAT paid. Then when you sailed it to UK there was no need for RGR because you were sailing from one EU state to another. In just the same way as when I sailed my Greek VAT paid boat to Spain and then by road to UK. All the time you had it in the UK it was an EU boat and you could move it freely - including taking it out of the EU and coming back to the UK under RGR.

The situation now is that you have a boat with VAT paid in Portugal and located in France on 31/12. I am not sure that it having spent some time in the UK in the past makes it eligible for RGR into UK.

Rather than speculate, suggest that you contact HMRC at the address in No8 for advice. If you do want it to be seen as UK VAT paid then It would be wise to have this in writing to avoid potential difficulties when you come to sell. Otherwise your buyer is going to see a Portuguese VAT receipt and evidence that it was in the EU on 31/12 and therefore potentially liable for VAT in the UK.

Sound advice to contact HMRC to eliminate any doubt.
However to put my head on the block I'd be strongly of the opinion the boat qualifies for RGR in that it had "been in free circulation in the UK when exported" in 2020.

 

[Tranona]

Very sensible. My old Greek paid boat which I bought new VAT free for charter use, now lives in San Carles. Plenty of buyers in the future in Europe if you wish to sell as they can no longer plunder the UK for cheap used boats!

 

[Graham376]

I don't believe this is correct. Bobc is entitled to RGR in the UK based on the facts as outlined by him.

In the hypothetical case, it would depend on whether the boat had ever been in the UK. Any boat which has never been in the UK, is not entitled to RGR. Treasury Minister Jesee Norman has this to say -

The proposal to apply a three-year period of grace which would apply to all recreational boats located in the EU at the end of the transition period, irrespective of whether the boat has ever previously been within the UK, goes further than the provision of transitional arrangements for goods returning to the UK. This would apply a special treatment to pleasure craft which is not available to other goods in free circulation in the EU at the end of the transition period. The Government does not believe that such special treatment can be justified.

 

[Irish Rover]

In the hypothetical case, it would depend on whether the boat had ever been in the UK. Any boat which has never been in the UK, is not entitled to RGR. Treasury Minister Jesee Norman has this to say -

The proposal to apply a three-year period of grace which would apply to all recreational boats located in the EU at the end of the transition period, irrespective of whether the boat has ever previously been within the UK, goes further than the provision of transitional arrangements for goods returning to the UK. This would apply a special treatment to pleasure craft which is not available to other goods in free circulation in the EU at the end of the transition period. The Government does not believe that such special treatment can be justified.

He clearly says in #29 it was in the UK from 2011 to 2020.

 

[Graham376]

He clearly says in #29 it was in the UK from 2011 to 2020.

Read #26, the hypothetical case I referred to, not his actual situation -

He later said in #29 it had been in UK.

 

[Irish Rover]

Read #26, the hypothetical case I referred to, not his actual situation -

He later said in #29 it had been in UK.

I see. I have this habit of reading all the posts in a thread before posting myself - it's called keeping up

 

[Baggywrinkle]

My interpretation is that a boat that was in the EU was, by definition, in a customs area including the UK until 31.12.2020 - because the UK was in the customs union up until that point and EU goods had freedom to circulate in the UK regardless of their physical location in Europe.

Then the UK left, splitting this customs area in 2 - UK and EU. The location of the boat on 31.12.2020 determines which customs area the goods are now free to circulate in, UK goods or Union goods.

Can anyone tell me why 31.12.2020 is not the day a UK boat which was Union Goods up until that point was effectively exported from the UK customs area?

I have concrete experience of the reverse, where my boat was in a country that acceded to the EU - and the chargeable event for the import into the EU was the day of accession of the country concerned - why would this not be the reverse in the case of a country leaving?

I know ultimately it is the UK that decides about UK goods, but it seems like the UK has chosen to ignore that UK boat owners had free circulation of their Union goods in the UK before 31.12.2020 - which they should be able to reclaim with RGR. The only difference being that a country left the customs area rather than the boat leaving the customs area.