Buying a Boat in Turkey

[Laser310]

I am interested in a boat that is at a marina in Turkey, and is listed by a Turkish broker.

The boat is registered, and VAT paid, in an EU country.

The boat is priced in Euros

For no particular reason.., the thought of doing any kind of significant financial transaction in Turkey makes me uncomfortable.

I am thinking that the transaction can take place in the country where the boat is registered - would that be normal?

Are there any issues that I should be aware of that are unique to buying a boat that is berthed in Turkey?

 

[Tranona]

The boat is outside the EU so will be considered non EU VAT paid. The only way it can retain its VAT paid status is to be moved to Greece under Returned Goods Relief BUT this is only available to the person who took it out of the EU and it must be within the last 3 years. If it has changed hands outside the EU it will be subject to VAT if brought into the EU unless you are non EU resident and can apply for Temporary Admission nominally for 18 months but renewable. Similar situation if you want to bring it to the UK except there is no temporary admission for UK residents and VAT will be payable on entry.

Registration is irrelevant as is the citizenship or residence of the current owner and the currency used in the transaction. You have to accept realistically that it is only worth buying if you intend keeping it outside the EU or using the temporary admission rule within the EU. Because of these restrictions it should be significantly cheaper than a similar boat VAT paid in the EU or UK.

 

[Slowboat35]

PM sent

 

[Laser310]

The boat is outside the EU so will be considered non EU VAT paid.

I guess I don't understand why this is so...

It is registered in an EU country and VAT was paid in that country.

The owner has visited Turkey with his boat - perhaps quite recently.

 

[j24jam]

I guess I don't understand why this is so...

It is registered in an EU country and VAT was paid in that country.

The owner has visited Turkey with his boat - perhaps quite recently.

That statement is only true is the sale takes place outside of the EEA (European Economic Area). The boat would lose its EU VAT paid status if the sale takes place in Turkey, if the sale takes place in the EEA (Greece is an example), then the EU VAT Paid status would remain with the boat (as long as it can qualify for RGR to the EEA under the vendors ownership)

 

[Laser310]

That statement is only true is the sale takes place outside of the EEA (European Economic Area). The boat would lose its EU VAT paid status if the sale takes place in Turkey, if the sale takes place in the EEA (Greece is an example), then the EU VAT Paid status would remain with the boat (as long as it can qualify for RGR to the EEA under the vendors ownership)

Thanks.

Does a boat have to be in the country in which the transaction occurs.., when the transaction occurs.., in order to retain the VAT paid status?

In other words, Can the boat remain in Turkey.., while the transaction occurs in, say, Greece?

 

[j24jam]

Thanks.

Does a boat have to be in the country in which the transaction occurs.., when the transaction occurs.., in order to retain the VAT paid status?

In other words, Can the boat remain in Turkey.., while the transaction occurs in, say, Greece?

The transaction occurs where the boat is. The boat has to move.

 

[Laser310]

That statement is only true is the sale takes place outside of the EEA (European Economic Area). The boat would lose its EU VAT paid status if the sale takes place in Turkey, if the sale takes place in the EEA (Greece is an example), then the EU VAT Paid status would remain with the boat (as long as it can qualify for RGR to the EEA under the vendors ownership)

can you remind me what RGR is?

does that refer to the question of where the boat was on Dec 31 2020?

I guess either way, the dec 31 location is something i need to look into...

edit -- thinking about it the dec 31 location doesn't matter.., because it's not a british flagged/VAT paid vessel. It's VAT paid in a country that is still in the EU

is that right?

 

[Tranona]

can you remind me what RGR is?

does that refer to the question of where the boat was on Dec 31 2020?

I guess either way, the dec 31 location is something i need to look into...

edit -- thinking about it the dec 31 location doesn't matter.., because it's not a british flagged/VAT paid vessel. It's VAT paid in a country that is still in the EU

is that right?

Returned goods relief. this is the main device used to avoid VAT if you take a boat out of the EU (or UK) for any period of time> The person who took it out can bring it back without paying VAT again - in the EU the time limit is 3 years in the UK there is no time limit. BUT if the boat changes hands outside the EU then its VAT paid status is lost and the new owner has to pay VAT when taking it back, although if non resident you can use temprary admission that allows you to use the boat in the EU nominally for 18 months, but renewable. You cannit sell it though in the EU without paying VAT. State of registration, of the owner or where VAT was paid is totally irrelevant.

VAT is a tax in transactions, not the asset and importing a boat is is a "chargeable event" unless you can take advantage of one of those reliefs.

Sorry I am repeating what I said in Post#2 with a little bit more explanation.

In the information you have given if you buy this boat in Turkey you potentially have to pay VAT in the EU, unless you use TA as a non resident. However it will never be considered EU VAT paid, so is worth significantly less than a boat already in the EU. To repeat myself again. If the owner takes the boat to Greece and you buy it there it will be considered VAT paid assuming he was the one that took it to Turkey). You can then use it unlomoted in the EU (subject to your personal constraints) and also take it out say to Turkey for visits and return without problems within 3 years. If you want to bring it to the UK and you are UK resident, VAT will be payable on arrival.

You have to consider and understand all these rules before committing to buying such a boat to decide whether you can live with them.

 

[Irish Rover]

can you remind me what RGR is?

does that refer to the question of where the boat was on Dec 31 2020?

I guess either way, the dec 31 location is something i need to look into...

edit -- thinking about it the dec 31 location doesn't matter.., because it's not a british flagged/VAT paid vessel. It's VAT paid in a country that is still in the EU

is that right?

31/12/20 is irrelevant in this case.
You say the boat is EU VAT paid. Have you sound proof?
How long has it been out of the EU? RGR = returned goods relief allows the person who took it out of the EU to reimport it within 3 years without paying VAT.
When the boat left to EU [most probably Greece] it should have "signed out". On reentry it should sign in again and the owner should not have changed while outside the EU. Hard to get around that. On the plus side there are very few places in Türkiye more than a few hours from the nearest Greek port of entry so it's hardly a big chore for the current owner to accompany you and sign it in.

 

[KompetentKrew]

can you remind me what RGR is?

Returned goods relief.

does that refer to the question of where the boat was on Dec 31 2020?

I guess either way, the dec 31 location is something i need to look into...

edit -- thinking about it the dec 31 location doesn't matter.., because it's not a british flagged/VAT paid vessel. It's VAT paid in a country that is still in the EU

is that right?

Your edit is right.

If Vincenzo is a private buyer who is EU resident and buying a brand new boat in the EU then he pays VAT, which is collected by the Beneteau dealer.

If Vincenzo sells the boat to Sergio, also in the EU, then Sergio pays no VAT because it's a secondhand sale.

Sergio can sail the boat out of the EU and back in and there is no VAT to pay.

You pay no VAT if you buy the boat from Sergio - this is true, in fact, wherever you buy the boat. But if you buy the boat in Turkey you must pay VAT when you import it to the EU (or UK for that matter).

So you want Sergio to bring the boat back to the EU, so you can buy it off him VAT-paid and then sail wherever you like - again, you can sail it out of the EU and back in again, as long as you do so only temporarily.