Boat from USA

[Carling]

If I were to buy a boat, such as an Island packet, from Florida, and commenced a world cruise would I still be liable for VAT in the Eurozone even if I was only in it for a limited time? would I also have to arrange the an assessment under the RCD even for quality boat like the Island Packet?
I have tried reading the regs. and I am more confused now than when I started? Finally would I be able to claim any tax back for taking the boat from the USA in the same way as foreigners can claim VAT back when leaving Britain?

 

[macd]

Search the site. There's lots of stuff on the questions you raise.
Last time I looked, neither Island Packet nor any other make was specifically exempt from RCD. Seriously, would you have it otherwise?
Good luck with your quest for a US boat. Can I suggest you name her 'Cake and Eat It'

 

[Bilgediver]

Island PAcket boats have met CE certification since around 1998 so a newish one is no problem bu an e-mail to them would get a definitive answer.

I found Island Packet very helpfull in providing stability curves etc as required for obtaining RCD for boats pre 1998.

 

[Carling]

The reason I ask about the RCD is that they are used extensively around the world, have a great reputation, they are already sold in the EU (more of a selection in the US) and as they are not one offs but semi mass produced to a standard. The need to then asses them for safety seems peculiar for a boat that is less than 7 years old. And yes, I see no point in having cake and not eating it.

 

[Maree]

Buy the boat in the US and pay the sales tax. Commence world cruise, but miss out any of the EU outposts in the caribbean. When you finally get back to UK, declare to customs that you are bringing the boat in under "Importation of a private vessel on transfer of residence from outside the EC". Pay no customs duty or VAT. The critical things are that you have been abroad for at least twelve months, and owned the boat for six months.....and that you paid the original purchase tax where you bought it. I found the process very easy when I did it in 2004, but I did have documentary proof that I was living in US (apartment rental agreement & tax forms) so you might want to check up on that aspect.

Alternatively, if you simply don't want to pay sales tax in US, you don't have to. The sales tax (at least for a second hand boat, not sure about new one) is linked to the issuing of the boat registration. We had 28 days after purchase to toddle off to the registration department and cough up. The broker told us we could otherwise simply get UK part three, and purchase a cruising permit to stay in US as a visiting boat.

 

[DaveNTL]

If you are looking at buying a second hand IP from Florida, or anywhere in the US for that matter - I would recommend calling Ed Whiteakre of Whiteacre Yacht Sales. He used to be with Island Yachting Center which last I heard he was taking over but now seems to have gone it alone.

He gives great service, is well respected by IP, and will act for you regardless of it being one of his boats or a boat with another broker, as is the tendency in the States, unlike the UK.

He's sold to several Brits and would have been me too if I hadn't found a Nauticat I preferred.

 

[Carling]

Thanks to both Mettle and Nautibusby. I will google whiteacre right now. I had not heard about Mettle's tax option...this forum is fab!!!

 

[Maree]

If we're recommending brokers......John Procter of Lawson Yachts just south of Boston was the broker we bought through. Although, of course, he was acting for the seller he went above and beyond the call of duty to help us through the process. As Nautibusby says, US brokers can be contracted to act for buyers also, so if you're interested in a northeastern yacht I'd seriously recommend him.

 

[DaveNTL]

[ QUOTE ]
Buy the boat in the US and pay the sales tax. Commence world cruise, but miss out any of the EU outposts in the caribbean. When you finally get back to UK, declare to customs that you are bringing the boat in under "Importation of a private vessel on transfer of residence from outside the EC". Pay no customs duty or VAT. The critical things are that you have been abroad for at least twelve months, and owned the boat for six months.....and that you paid the original purchase tax where you bought it.

[/ QUOTE ]


Do you know what would happen if you had bought the boat from a tax free state or country or if you have been a resident of a tax free country?

 

[Maree]

I assume that would be OK.

I paid 5% sales tax in massachussetts as that was where the boat would be kept (in the US the tax is linked to the boat residency rather than your own residency). As I understand it the critical thing is not to have had any tax refunded because you're not resident, or to have purchased it as part of any tax free scheme which would not be available to normal residents of that state/country. If the tax rate is zero (Delaware/New Hampshire etc) then I think that is OK, but bear in mind I'm not an expert.

Have you looked at the form on the customs website? - it explains in a bit more detail.

I've not personally come across anyone who has done this as part of a world voyage, but it seems to me that it ought to be possible, as you should be able to be considered non-resident of the UK if you are away for a couple of years, and are therefore transferring your residence back to the UK when you return home.

 

[LadyJessie]

[ QUOTE ]
As I understand it the critical thing is not to have had any tax refunded because you're not resident, or to have purchased it as part of any tax free scheme which would not be available to normal residents of that state/country.

[/ QUOTE ]No, this is not correct. Your earlier post outlining the 12 months residency and 6 month ownership is correct and the basic requirement for a tax free importation when changing residency. It does not matter if you paid original tax or not. As a matter of fact, most car companies will be able to deliver a tax-free vehicle to you in one country for importation into another when you move. It is usually called something like "Diplomat and Expat Services". It is perfectly legal and can save you lots of money.

 

[Maree]

I'm not an accountant, but my interpretation is different from yours. I don't think you are eligible to take advantage of the importation into EU free of tax if you have already taken advantage of a tax free scheme in the original country.....unless of course the person in question is a diplomat which I don't think is the case here.

In fact one of the supporting documents I had to produce for my claim (was requested by UK customs) was the receipt for the sales tax I paid in the US.

 

[LadyJessie]

I do not understand why the UK customs would be interested in US sales tax. I have not dealt with these issues in the last four years so rules might have changed (although I doubt it, this one does not make any sense). I have handled many expats moving into the EU from all over the world and the rules as you originally quoted them (>12 months non-EU residency/>6 months ownership) was the basis for tax free treatment of 'personal goods'. I have never handled a liveaboard sailor that came back with a boat bought outside the EU, but I would strongly argue that the normal 'expat' rules would also apply to them. You have been 'resident' on your boat, you just need to prove it.

Again, original tax paid has no relevance in the EU if you conform to the base rules. Many countries does not even have VAT or a sales tax so having that as a requirement for importation would not be workable.

 

[DaveNTL]

[ QUOTE ]
Again, original tax paid has no relevance in the EU if you conform to the base rules. Many countries does not even have VAT or a sales tax so having that as a requirement for importation would not be workable.

[/ QUOTE ]

That was the slant of my question - I didn't pay U.S. tax on mine and I've been non-resident for 25 years - I've thought about shipping the boat back at some stage and wondered if I could do it free of VAT etc... but it's a none starter based on it being too bloody cold in britain really. Still... it's interesting. If I wanted to sell it I think it would sell easier in Europe than the U.S. because I bought it at a good exchange rate and could sell it relatively cheap.

 

[Abaker]

We entered the UK at Falmouth in 2002 in yacht built in the US and previously imported from the US into Canada. The UK Customs office in Dover, which dealt with such matters, sent an application form and booklet stating the rules concerning VAT exemption when importing a yacht into the UK on permanent transfer of residence. One of the rules was that any sales tax required in the country from which the yacht was being imported must have been paid, and the relevant receipt must be provided along with the application for exemption from VAT. We provided that and the other necessary documents and informaiton, and the importation went smoothly. One can argue that the rule makes no sense, but that won't change it. As to whether it's workable, I suppose UK Customs can easily find out which foreign countries or states charge a tax similar to VAT.

 

[LadyJessie]

We seem to have different opinions on the rules. I therefore checked with my old friends at the VERY big accounting firm and they confirmed that rules regarding tax-free importation on change of residency have not changed; you will be able to import your 'household goods' (which can include cars, yachts, airplanes, etc) tax-free if you move into the EU from a non-EU country, provided you can show non-EU residency of more than 12 months and ownership of more than six months. Tax status of goods bought is irrelevant.

We believe the references to sales tax/VAT receipts that you have seen can only relate to intra-EU moves. There is no tax-free status within the EU. You can buy a yacht in Sweden or a car in Germany tax-free, but when you import it into the UK, you will have to pay UK VAT regardless if you have been on a daytrip or lived there for 30 years. The questions from customs can only relate to their need to establish whether EU VAT have been paid or not. No other sales tax/VAT is relevant to a residency change importation.

 

[JIMCAT]

The opposite situation affects me, having sold my Catamaran to a citizen of the U.S.A. which is S.S,R. registered and VAT paid I am in the middle of trying to satisfy the U.S.A. authorities that the Cat is free to be imported into U.S.A.. Any fumerites had experience of the situation.