Buy a Yacht in Croatia VAT unpaid

[Sailing.Dan]

Hi, I am looking to view a boat in Croatia on Monday. Will be my first boat and I am trying to get my head around the VAT rules. I will be living on board full time and the plan is to spend the next few years sailing round the world so the boat won't be anywhere long enough to warrant the VAT being paid. I am just looking for some advice if possible from people that have done similar and to put my mind at rest that it is all ok and possible?

Thank you
Dan

 

[Tranona]

Hi, I am looking to view a boat in Croatia on Monday. Will be my first boat and I am trying to get my head around the VAT rules. I will be living on board full time and the plan is to spend the next few years sailing round the world so the boat won't be anywhere long enough to warrant the VAT being paid. I am just looking for some advice if possible from people that have done similar and to put my mind at rest that it is all ok and possible?

Thank you
Dan

Pretty straightforward. If it is a used boat it is either EU VAT paid or not (for example if coming off charter or owned by a non EU resident). If it is EU VAT paid then you can do whatever you want with it, but to maintain EU paid status it must not be out of the EU for more than 3 years when it loses the status.

If you are a non EU resident you can also buy a non VAT paid boat and keep it in the EU for up to 18 months at a time without paying VAT. If you are EU resident you cannot own and use a non VAT paid boat in the EU.

So what you can do depends on the status of the boat you are interested in and your residence.

 

[Sailing.Dan]

Thank you so much for the reply Tranona I really appreciate it. The boat is VAT not paid and I am a UK resident.

 

[st599]

Whilst the boat can stay in the EU for up to 18 months at a time, you can't unless you have an EU passport or arrange a visa. And some visas bring residency, which then requires VAT payment.

And if you bring it back to the UK, VAT is due immediately.

 

[Sailing.Dan]

Thank you st599 My plan is to spend a few months around Europe/Turkey/Tunisia/Africa/Gibraltar then head across the Atlantic. I will alos fly in and out for a few weeks t if needed. Appreciate the advice.

 

[Tranona]

Thank you so much for the reply Tranona I really appreciate it. The boat is VAT not paid and I am a UK resident.

OK that makes it simple. Register the boat in the UK - the SSR will be fine. Just ensure that you have clean documentation from the seller and comply with the requirements for Temporary Admission when you are in EU waters. This varies from state to state as implementation is through local customs and the process of recording (or otherwise) of entry and exit varies from state to state and even from customs office to office.

 

[fitsu]

Hi, I am looking to view a boat in Croatia on Monday. Will be my first boat and I am trying to get my head around the VAT rules. I will be living on board full time and the plan is to spend the next few years sailing round the world so the boat won't be anywhere long enough to warrant the VAT being paid. I am just looking for some advice if possible from people that have done similar and to put my mind at rest that it is all ok and possible?

Thank you
Dan

Perhaps you can help further - boat is coming out of a charter company in Croatia - it will be registered and flagged oustide of the EU and the owners will all be non EU citiszens .tax payers
We take delivery/transfer at the end of October but would like to leave in Croatia until the next summer (mid May) before moving
Would we be able to remain VAT exempt for 4-6 months before we move the boat ?

 

[Tranona]

Perhaps you can help further - boat is coming out of a charter company in Croatia - it will be registered and flagged oustide of the EU and the owners will all be non EU citiszens .tax payers
We take delivery/transfer at the end of October but would like to leave in Croatia until the next summer (mid May) before moving
Would we be able to remain VAT exempt for 4-6 months before we move the boat ?

You will need to apply for temporary Admission into the EU which will give you 18 months. I expect the charter company will organise this for you. Customs will probably require you to check out of Croatia, change the registration of the boat and re-enter as a non EU boat. It is a well established procedure but you must organise it in advance with customs. Forum member Irish Rover did this last year, buying an ex charter boat in Croatia and later sailing it to Montenegro, Greece and finally Turkey where he lives without any problems.

 

[Irish Rover]

@fitsu The difference in my case is I was always planning to make Montenegro my next stop after i left Croatia, and I had no wish to return in the short term. I believe @Baggywrinkle reported on the forum that when he bought an ex charter boat he checked out from one port in Croatia and checked in at another without issue. You definitely won't have any difficulty re-entering Croatia under TA, and the only question is whether you should spend a night outside the EU before re-entering. When you check-in and apply for TA they will ask you where was your last port of call, so you have to decide if you want to chance telling a porky.
You say all owners are non EU citizens/tax payers. The rules stipulate non EU residency and that's what the customs will be interested in rather than citizenship etc.

 

[Baggywrinkle]

Perhaps you can help further - boat is coming out of a charter company in Croatia - it will be registered and flagged oustide of the EU and the owners will all be non EU citiszens .tax payers
We take delivery/transfer at the end of October but would like to leave in Croatia until the next summer (mid May) before moving
Would we be able to remain VAT exempt for 4-6 months before we move the boat ?

HI, as mentioned by @Irish Rover I bought an ex-charter boat in Split in Croatia before they joined the EU. Things have changed a bit, the UK has left the EU making UK residents eligible for TA in the EU, and Croatia joined the EU in 2013 but the rules on TA have remained the same.

The rules are, in order to buy the boat with no VAT paid, you need to export it immediately from the EU. I did this on the day I took ownership of the boat. I met the sellers agent at the Port of Entry in Split and cleared the boat out through customs, checked out of the country and sailed off from Split in the general direction of Pula to the North. Do not re-enter or anchor anywhere during your journey - others have done this and one spent 3 months chained to a customs dock in Italy as a result. Your next port of call needs to be an EU Port of Entry and as there is nothing illegal or wrong about what you are doing, be frank and honest with the customs officials and all will be fine.

While underway, I changed the boat name and flag and had all the paperwork with the boats new identity pre-prepared.

36 hours later I arrived at another Port of Entry further up the Croatian coast (Mali Losinj). I told the customs oficials I had bought the boat the day before, it was an ex-charter from a Croatian Charter company, and I'd like to keep it in Croatia under TA. They were very helpful as was the harbour master and the paperwork for the TA was sorted out in a few hours.

In the following years I had to leave and re-enter every 18 months to extend the TA .... but again, the Croatian authorities were very accomodating as it was a normal occurrence. I could check-out and check-in on the same day with no formal requirement to prove I had left Croatian waters.

The customs rules do not provide for a 'minimum period' during which the goods must remain outside of the customs territory of the Union.

https://taxation-customs.ec.europa.eu/system/files/2018-04/rules_for_private_boats-faq_en.pdf

Since Croatia joined the EU, there may be more confusion in Croatia as to what constitutes leaving EU waters, the simple answer is to ask the officials when you check out what you need to do, and if re-entering at another port then ask them what they expect. Comply and all will be fine. There is nothing dodgy or illegal about TA in the EU if none of the owners or people on board are EU residents.