Brexit and VAT status - flotilla from UK

greeny said:
Not sure any of this debate is going to help anyone and until the dust settles after B day no one will know..............
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And that is indeed the issue. But somebody with a large value tied up in VAT, particularly in a specialist boat most saleable outwith the U.K.,decisions will need to be made before B-day to mitigate the risk of losing tens of thousands of pounds in boat value / net worth. Acting afterwards could be too late.
Unlikely to be an issue for somebody with an old Westerly or Moody, but a sizeable risk for anybody invested a significant chunk of their assets in recent boat as a liveaboard or retirement boat.

PS I feel one must be a very brave (and wealthy) gambler to invest in buying a new U.K. VAT paid boat at the Southampton Boat Show, for example, unless more clarity. Certainly I would not have invested a lot of U.K. VAT in a boat over the past year.
 
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dunedin said:
Unlikely to be an issue for somebody with an old Westerly or Moody, but a sizeable risk for anybody invested a significant chunk of their assets in recent boat as a liveaboard or retirement boat.
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It's an issue for anyone with a boat. Even the £40k Westerly or Moody may have an £8k to £10k VAT bill if moving in/out of the UK/EU and that no doubt is an extra discount a prospective purchaser will be wanting.
 
Graham376 said:
It's an issue for anyone with a boat. Even the £40k Westerly or Moody may have an £8k to £10k VAT bill if moving in/out of the UK/EU and that no doubt is an extra discount a prospective purchaser will be wanting.
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One (or many...) may try suing the British state for negligence if that actually happens.
 
It's just another Brexit bonus. ;)

Look at it this way ... those with VAT paid boats, regardless of value (5K is a lot of money to some people) will have a dilemma. They must decide if the boat makes more sense as EU goods or UK goods and act accordingly - of course returning a boat from the Med is a real pain in the arse ... but ... as it looks, the UK government will give UK residents a few years to re-patriate their boats and retain their VAT paid status using returning goods relief. We don't yet know if it will also work the other way round.

As a plus, post Brexit, a UK citizen should be able to buy and run a VAT free boat in the EU. This can be done by exporting a boat from the UK with no VAT paid, or by buying VAT free in the EU for export, but then returning to the EU under temporary import rules. (This requires a check out and in again every 18 months to reset the temporary import clock). Downside is that the owner can only spend 90 days out of 180 on the boat - so retirees/live aboards may have issues.

More worrying is that all second hand boats in the UK will be less attractive to EU buyers as their UK VAT paid status is worthless. They will need to be imported to the EU anyway - so the pound would have to tank by another 20% to make it worth EU citizens buying UK boats - or the boats second hand value will have to drop considerably. Similarly EU boats for use in the UK (by UK citizens) will need to be imported into the UK. I don't know how much UK second hand stock is sold to EU buyers or vice-versa, perhaps a broker can shed more light, but I would imagine supply/demand will be affected. UK buyers would have to consider the additional VAT/Import duties payable on all EU boats, and vice-versa. Hopefully there wont be any RCD/CE issues as with ROW boats currently.
 
Baggywrinkle said:
More worrying is that all second hand boats in the UK will be less attractive to EU buyers anyone willing to sail EU waters extensively as their UK VAT paid status is worthless. They will need to be imported to the EU anyway - so the pound would have to tank by another 20% to make it worth EU citizens buying UK boats - or the boats second hand value will have to drop considerably. Similarly EU boats for use in the UK (by UK citizens) will need to be imported into the UK. I don't know how much UK second hand stock is sold to EU buyers or vice-versa, perhaps a broker can shed more light, but I would imagine supply/demand will be affected. UK buyers would have to consider the additional VAT/Import duties payable on all EU boats, and vice-versa. Hopefully there wont be any RCD/CE issues as with ROW boats currently.
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Couple of billions vaporized, while some may benefit a few thousand.

Baggywrinkle said:
This is what is likely from multi-nationals under the terms of the UKs bilateral investment treaties, but as a UK citizen, the country collectively voted for it ... so no recourse I would suspect.
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Interesting: in case of an e.g. German/French/Greek/American/etc owner, having a UK boat that he is unable to move to the EU VAT area from wherever the boat is between the Canaries and Norway, could try. But courts should be impartial, if a Briton tries the same, the ruling should be the same too? Probably we should see after B-day...
 
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GTom said:
Couple of billions vaporized, while some may benefit a few thousand.
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A UK citizen can sail in the EU in a UK VAT paid boat under a temporary import. They can only stay out of the UK for the maximum time allowed under returning goods relief or they will lose UK VAT paid status - and they can't officially do a major re-fit outside the UK - but they can do as many 18 month temporary imports to the EU as they like without incurring any additional import/VAT charges. ... the individuals will have to comply with the 90 day in 180 rules for non-EU visitors however.
 
Baggywrinkle said:
A UK citizen can sail in the EU in a UK VAT paid boat under a temporary import. They can only stay out of the UK for the maximum time allowed under returning goods relief or they will lose UK VAT paid status - and they can't officially do a major re-fit outside the UK - but they can do as many 18 month temporary imports to the EU as they like without incurring any additional import/VAT charges. ... the individuals will have to comply with the 90 day in 180 rules for non-EU visitors however.
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He can indeed, but moving the boat out of the EU every 18 months is a hassle in many regions. Non issue in Greece but might be cumbersome in the Rias, Mediterranean France or Sardinia. Retirement/relocation plans in Spain, etc became also an expensive venture: many might sell their UK boats instead and buy another down under, which creates additional selling pressure on the UK boat market.
 
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dunedin said:
And that is indeed the issue. But somebody with a large value tied up in VAT, particularly in a specialist boat most saleable outwith the U.K.,decisions will need to be made before B-day to mitigate the risk of losing tens of thousands of pounds in boat value / net worth. Acting afterwards could be too late.
Unlikely to be an issue for somebody with an old Westerly or Moody, but a sizeable risk for anybody invested a significant chunk of their assets in recent boat as a liveaboard or retirement boat.

PS I feel one must be a very brave (and wealthy) gambler to invest in buying a new U.K. VAT paid boat at the Southampton Boat Show, for example, unless more clarity. Certainly I would not have invested a lot of U.K. VAT in a boat over the past year.
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So what are you realistically going to do to mitigate the risk that you don't understand or know anything about yet? Except worry maybe. Lifes too short.
 
greeny said:
So what are you realistically going to do to mitigate the risk that you don't understand or know anything about yet? Except worry maybe. Lifes too short.
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Read OP original post. One option to retain EU VAT could be to move a U.K. boat to be in a EU country overnight on B- day. That’s where this thread started, and is based upon current best information able to be obtained so far by RYA and Cruising Association.
 
GTom said:
He can indeed, but moving the boat out of the EU every 18 months is a hassle in many regions. Non issue in Greece but might be cumbersome in the Rias, Mediterranean France or Sardinia. Retirement/relocation plans in Spain, etc became also an expensive venture: many might sell their UK boats instead and buy another down under, which creates additional selling pressure on the UK boat market.
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Also remember that cruising around the EU in a non-EU-VAT-paid yacht is not technically an option if you have EU citizenship.
 
dunedin said:
Read OP original post. One option to retain EU VAT could be to move a U.K. boat to be in a EU country overnight on B- day. That’s where this thread started, and is based upon current best information able to be obtained so far by RYA and Cruising Association.
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Do you honestly think that will solve the problem. As I said in previous post, a boat is a Mode of transport and will be treated as such. As will a ship aircraft car lorry etc etc. For example, uk vat paid car that happens to be in Europe om B day will not assume EU vat paid staus and lose UK vat paid status overnight any more than a ship or boat will.
And after B day, EU vat status will not be determined by either the CA or RYA. I'm thinking the EU may have something to say. Of course, eventually when all the dust settles they may both find a middle ground that does not damage either EU or UK vehicle owners. Now that would be novel.
 
dunedin said:
Read OP original post. One option to retain EU VAT could be to move a U.K. boat to be in a EU country overnight on B- day. That’s where this thread started, and is based upon current best information able to be obtained so far by RYA and Cruising Association.
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Once again, the article to which the OP linked is about union goods status, not VAT status.
 
greeny said:
So what are you realistically going to do to mitigate the risk that you don't understand or know anything about yet? Except worry maybe. Lifes too short.
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Ensuring a boat has some paperwork, e.g. from berthing, on 31st Oct, is by far the simplest way to fully mitigate the risk of loss of EU VAT paid status should one sell their boat later to an EU national or someone that wants to then keep it in EU.

The trips back and forth is less of an issue due to temp import rules, but again the boat being in EU (not UK) on 31st may potentially help that.

Of course it means an October channel crossing, for me from Falmouth to probably L'aberwrach or points east of it, which could be "exciting".
 
Comrade Red said:
Ensuring a boat has some paperwork, e.g. from berthing, on 31st Oct, is by far the simplest way to fully mitigate the risk of loss of EU VAT paid status should one sell their boat later to an EU national or someone that wants to then keep it in EU.


So if your boat is deemed vat paid in France due to it being in france on B day , what happens if your future purchaser is english and wants to keep it in UK, or are you saying that your boat will be deemed vat paid in UK and the EU.
What is going to happen to the UK car, lorry, airplane that happens to be in the EU on B day and vice versa?
Sorry guys, still too much guesswork going on here for me. Regardless of what various organisations and individuals have reportedly said, we still don't know what the outcome will be and I suspect no-one in government has thought it through this far either.
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Greenly I don’t think your analysis is correct. A boat in the EU on B day will retain its VAT paid status. Even foreign flagged vessels can have VAT paid status. If a UK boat with VAT paid status is subsequently sold in the UK it will lose that status so it is important to make sure that subsequent sales take place in an EU territory.
 
greeny said:
Comrade Red said:
Ensuring a boat has some paperwork, e.g. from berthing, on 31st Oct, is by far the simplest way to fully mitigate the risk of loss of EU VAT paid status should one sell their boat later to an EU national or someone that wants to then keep it in EU.


So if your boat is deemed vat paid in France due to it being in france on B day , what happens if your future purchaser is english and wants to keep it in UK, or are you saying that your boat will be deemed vat paid in UK and the EU.
What is going to happen to the UK car, lorry, airplane that happens to be in the EU on B day and vice versa?
Sorry guys, still too much guesswork going on here for me. Regardless of what various organisations and individuals have reportedly said, we still don't know what the outcome will be and I suspect no-one in government has thought it through this far either.
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The definition of Union Goods is as follows ...

Evidence that the boat has the status of Union goods
Freedom of movement throughout the European Union (EU) is a basic principal of the EU which applies both to goods made and supplied in the Union and to goods which have been imported and released for free circulation.

Boats which have the customs status of Union goods may move, without being subject to a customs procedure, from one point to another within the customs territory of the Union, and temporarily out of that territory by sea without alteration of their customs status provided that their customs status of Union goods is proven.

In order for a boat to have the customs status of Union goods VAT must be accounted for and if the boat has been imported any applicable customs duty must also have been paid. The owner is then able to move the boat freely through the EU.
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https://www.rya.org.uk/knowledge-advice/boating-abroad/Pages/paperwork.aspx#4

The RYA advice having talked to HMRC is ...

If my boat is lying in the EU27 at the time of a ‘no deal’ Brexit, will I be able to claim relief from VAT and import duty if I bring it back to the UK after Brexit?


HMRC has advised the RYA that plans have been made to replicate Returned Goods Relief (RGR) into domestic law in the event of a no deal. RGR allows those resident in the UK to return with their belongings (including pleasure boats) to the UK without paying customs duty or VAT as long as the items have not been changed since their departure and follow the guidance given in the Notice 236 Returned Good Relief.

The UK Government has undertaken that RGR will be available in respect of UK pleasure craft not moored in the UK on EU exit day. They may return to the UK after the exit and be subject to returned goods relief as long as the person responsible has evidence that the VAT was paid on the purchase of the boat in either the UK or the EU. The types of proof needed are shown in Notice 8. VAT accounted for in the UK would need to be shown in respect of vessels purchased after the date of the EU exit.

Vessel owners not established in the UK can temporarily import their vessels using the rules set out in Notice 8.
There is no need to have every UK boat back in the UK on the 29/03/2019 or EU exit day.
Do I need to change my country of registration in order to keep my boat in an EU 27 country after a ‘no
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https://www.rya.org.uk/knowledge-advice/current-affairs/Pages/no-deal-Brexit-scenario.aspx

Therefore ...

My logic would be the following .... if the boat is in the EU on Brexit day. Ireland or Mainland Europe and it will almost certainly retain EU VAT paid status (Union Goods).

If you then need to sell the boat, and have an EU buyer, all is OK.

If you have a UK buyer, bring it back under the RTR scheme mentioned above so it gets status of UK Goods and then sell it in the UK, VAT Paid.
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greeny said:
So if your boat is deemed vat paid in France due to it being in france on B day , what happens if your future purchaser is english and wants to keep it in UK, or are you saying that your boat will be deemed vat paid in UK and the EU.
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If you take your boat back to the UK and sell it there, it loses its EU VAT status and the new UK resident owner will be limited to having it there max 18 months. If an EU resident buys it in the UK, he/she will have to pay VAT as soon as it arrives in EU.

Although you keep bring up "means of transport", the only EU notice I have read is specifically about boats. Each State will impose it's own interpretation and may well (as Portugal does now) treat the various "means of transport" differently.
 
Does the EU have the equivalent of Returned Goods Relief?

My boat was originally imported into the EU from the USA, and we paid VAT initially in the UK. More recently we are based outside the EU, in the Med. Next year I may wish to return to the EU and eventually sell the boat.
 
Resolution said:
Does the EU have the equivalent of Returned Goods Relief?

My boat was originally imported into the EU from the USA, and we paid VAT initially in the UK. More recently we are based outside the EU, in the Med. Next year I may wish to return to the EU and eventually sell the boat.
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Ireland certainly does ...

https://www.revenue.ie/en/customs-t...reimported-into-the-european-union/index.aspx

... and Germany too ...

https://www.zoll.de/EN/Private-indi...rmany/Returned-goods/returned-goods_node.html

... and here's a summary of the rest ...

https://www.sarniayachts.com/news/2015/rgr-for-non-eu/

I would take professional advice from a broker once your circumstances become clear.
 
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