Buying a boat in Spain

[haulyfryn]

The boat I am in the process of buying is advertised as VAT paid. When I received a copy of the documents the tax they are talking about appears to be a Matriculation tax that you pay when buying any Spanish registered boat and not the original purchase VAT. The boat has since been re registered onto a Holland flag which means that there is no further tax to pay by the new owners.
I know it is unlikely that I will ever be asked to prove that VAT has been paid, but there is always a chance that some bright spark in authority may someday see this as an opportunity to collect unpaid taxes.
Do you think I am justified in seeking a reduction in the originally agreed price of 27,000 or, should I just take a chance?

 

[wallacebob]

If the original invoice does not show IVA as being charged, and paid, then it sounds "unusual". Spanish rubber stamping likes things to be "usual". It may either bite you in the future or scare a buyer. Is the vessel permanently in Spain? Ask why it's not shown as paid, get a discount, and enjoy.

 

[jordanbasset]

Can you tell us how old the boat is, I am assuming it is either quite old or not that big

 

[haulyfryn]

The boat was built in 1998 and first launched in 1999 she is a Dufour Classic 32.

 

[haulyfryn]

The boat will be staying in Spain. I am waiting to hear if they will accept a lower offer and if this is not agreed I will walk away from it and hopefully get my deposit back.

 

[jordanbasset]

Not sure if the 27,000 is euros or sterling, either way it is not a bad price, depending on condition of course. But probably worth a lower offer to see what they say

 

[Contest1]

As I understand things 98/99 would be liable for VAT/IVA if proof of payment is unavailable.
The flag protects, to some extent, against the Spanish lisencing requirments for going to sea but not VAT.
I own a 1970 Contest SSR bought in Spain and don't expect VAT to be an issue.
My pal Peter is on his 13th boat and takes VAT very seriously.
If I was buying a 1999 model I would be concerned.
As suggested look for a discount to cover the possibility of being forced to cough up.

 

[Tranona]

As suggested look for a discount to cover the possibility of being forced to cough up.

This is a myth. There is absolutely no chance of an individual having to pay VAT on a boat that has always been in the EU. Sales between private individuals are not chargeable events so no VAT is due.

It MIGHT be different if the boat has spent time outside the EU.

 

[Tranona]

The boat will be staying in Spain. I am waiting to hear if they will accept a lower offer and if this is not agreed I will walk away from it and hopefully get my deposit back.

There is no reason for them to accept a lower offer as there is no chance of you ever being asked to pay any VAT. There is no mechanism for this unless the boat is being imported from outside the EU.

There is not enough information here to say definitively whether the evidence is sufficient, but in principle you need to go back to the original transaction from the dealer to the first owner and registration. If this was done correctly then VAT has been paid as it can't be registered in Spain without it. The change to Dutch registration is irrelevant from a VAT point of view, although it is a break in the trail of Spanish registration.

If the original registration is available then there is no reason to offer a lower price nor in my view can you expect your deposit back.

You may wish to get independent legal advice in Spain on the documentation that comes with the boat.

 

[Graham376]

There is not enough information here to say definitively whether the evidence is sufficient, but in principle you need to go back to the original transaction from the dealer to the first owner and registration. If this was done correctly then VAT has been paid as it can't be registered in Spain without it. The change to Dutch registration is irrelevant from a VAT point of view, although it is a break in the trail of Spanish registration.

Assuming the previous owners were private individuals, I wouldn't be worried about the VAT angle. As Tranona says, it wouldn't have been on the Spanish register if they weren't happy that VAT had been paid.

 

[haulyfryn]

The problem is that the the boat has had 3 owners and the original proof of VAT being paid is not available. The sales agreement states "VAT paid" and I have proceeded with lift out and survey on the assurance that all documentation is in place.

 

[macd]

The problem is that the the boat has had 3 owners and the original proof of VAT being paid is not available. The sales agreement states "VAT paid" and I have proceeded with lift out and survey on the assurance that all documentation is in place.

Has it ever been on the Spanish register as a private pleasure craft? As said, if it has, that means VAT has been paid and is officially regarded as evidence of such. No point trying to apply a British logic to that, since there is nothing remotely comparable in the UK.

 

[Tranona]

The problem is that the the boat has had 3 owners and the original proof of VAT being paid is not available. The sales agreement states "VAT paid" and I have proceeded with lift out and survey on the assurance that all documentation is in place.

The original registration is your proof. It is not like the UK where the only proof is the original invoice. If the boat has always been in Spain with private owners then there is no way VAT cannot have been paid. As I said, there is no mechanism for private owners to be asked to pay VAT on a used boat that has never been out of the EU.

The UK obsession with VAT "proof" comes from our lack of any formal record keeping of either VAT payment or registration of boats. It is not so in most of the other EU states so nobody gets worked up about it.

 

[haulyfryn]

Tranona, Thank you for your knowledgeable replies. Could it be possible for a someone like a charter company who has bought a boat without paying VAT on the purchase price have that boat put on the register without having paid VAT, or is there a different register for this?

 

[Tranona]

Tranona, Thank you for your knowledgeable replies. Could it be possible for a someone like a charter company who has bought a boat without paying VAT on the purchase price have that boat put on the register without having paid VAT, or is there a different register for this?

If it was originally bought by a business and VAT reclaimed then when it was sold to a private person VAT would have been charged in the normal way and then the boat registered as a private boat. The record of ownership should tell you this.

Best to see all the documentation back to when it first left the factory and look for any holes or gaps. You may not get the transfer from the factory to the dealer but from the dealer onwards should be there.

 

[haulyfryn]

Thank you very much for all your replies.

 

[macd]

If the boat was on the Spanish register, haulfryn, you can console yourself that this is actually deemed proof of VAT payment. Due to the peculiarities of the UK VAT system, the best almost anyone can claim there is mere evidence of VAT payment. Funny old world.

 

[Graham376]

The UK obsession with VAT "proof" comes from our lack of any formal record keeping of either VAT payment or registration of boats. It is not so in most of the other EU states so nobody gets worked up about it.

Portugal is much the same as Spain, with a love of notarised paperwork. A guy wanted to buy my old outboard but the authorities wouldn't register it to his Portuguese boat's tender as I couldn't provide paperwork trail from new, including the original purchaser's VAT invoice.

One advantage of these regulations here is much less crime, a nicked outboard could never get registered.

 

[Contest1]

Interesting article in Augusts YM.

 

[Tranona]

Interesting article in Augusts YM.

If you are referring to the answer to the question about title and VAT evidence then it contains some outright errors and misleading statements. Hopefully they will publish a correction