Buying a boat registered in France

[Sneaky Pete]

If selling a boat in the UK as an owner I would need

1. A builders certificate
2. Proof of VAT paid.
3. 5 clear years of ownership.

I am thinking of buying a boat, this one has been bought in France, brought over to the UK and is being sold. There is no proof of VAT being paid or builder’s certificate. Is that a problem?

 

[Tranona]

It should have a deregistration certificate and a copy of the original French registration which is also confirmation that VAT has been paid. You will also need to see evidence of transfer of title if it has subsequently changed hands outside France. The Builders certificate is nice to have, but the registration document should show the ownership trail from new.

 

[Deleted User YDKXO]

I would think its a problem. If you dont have the original VAT invoice you cannot resell the boat as VAT paid and anybody who wants to mortgage the boat might find that the finance co doesnt value it at anywhere near the selling price for finance purposes because they'll assume its not VAT paid. As for the builders certificate, it confirms the HIN (hull identification number) which should match that on the boat of course, the year of manufacture and manufacturer's hull number which all go to confirm the provenance of the boat. You might be able to get a copy of the builders certificate from the manufacturer if it's still in business

Unless this boat is well below market price, if it was me, I'd walk

 

[MapisM]

My understanding is that if you are buying a used boat located in the EU and owned by a private individual, that simply CAN NOT be a VAT-table transaction.
Whether the current owner should have paid the VAT upon his purchase, that's his problem, not yours - unless you are actually contributing to smuggling the thing, somehow.
The lack of Builder's Certificate is weird, though. If nothing else, suggests that the current owner wasn't exactly very careful with his property... :ambivalence:

 

[Deleted User YDKXO]

My understanding is that if you are buying a used boat located in the EU and owned by a private individual, that simply CAN NOT be a VAT-table transaction:

Thats correct but remember we are leaving the EU and if this boat is kept in the UK but occasionally visits France, for example, an unfriendly French official might one day ask for proof of EU VAT status. I'm just guessing here but for UK berthed boats, proof of EU VAT payment might become more important after Brexit. But as I said thats not the main reason to have the original VAT invoice proving VAT was paid on the boat. If you can't prove that VAT has been paid on your boat then theoretically its worth 20% less than comparable VAT paid boats on the market

 

[MapisM]

we are leaving the EU

Are you, eventually? You must know something yet to be disclosed to public…

Joke aside, that's a good point indeed.
And regardless of bureaucracy, it is true that the lack of evidence on VAT status affects the market value no matter what, at least to some extent.

 

[Deleted User YDKXO]

Are you, eventually? You must know something yet to be disclosed to public…
.

Well you know me. I very much hope we dont!

 

[Sneaky Pete]

The broker of the boat is perfectly entitled to sell the boat for his client with or without these certificates. However selling the boat on in say a few years time will present problems for the reasons already mentioned. Even visiting a foreign port S-Ireland, France etc and boat owner may well be asked to pay VAT again.
I think this is a walk away one not enough clarity. I have asked a couple of respected brokers here about this, problems and grey area seems to raise its head too often.

 

[kennyh]

My understanding on this is that a non EU boat is not liable for VAT registration in the EU for at least 18months; during which period you have a TI - Temporary Import status.

Beyond that you would need to pay VAT.

So if you have paid VAT (in the EU) and can prove it, then no problem. If you haven’t or can’t prove it, then you have 18 months in EU waters with no issues. Thus, unless your moving the boat to the EU you shouldn’t have a problem.

 

[Tranona]

I would think its a problem. If you dont have the original VAT invoice you cannot resell the boat as VAT paid and anybody who wants to mortgage the boat might find that the finance co doesnt value it at anywhere near the selling price for finance purposes because they'll assume its not VAT paid. As for the builders certificate, it confirms the HIN (hull identification number) which should match that on the boat of course, the year of manufacture and manufacturer's hull number which all go to confirm the provenance of the boat. You might be able to get a copy of the builders certificate from the manufacturer if it's still in business

Unless this boat is well below market price, if it was me, I'd walk

This is a UK perspective and simply not relevant for a French registered boat. If it has the documents I suggested then that is proof of VAT paid. Just because it is done differently in the UK is not a good reason for saying the French system is flawed. It is only in the UK that the original invoice is considered the primary evidence of VAT payment, simply because we do not have an official record of payment unlike France and other EU states.

Equally the builders certificate is not an essential as the registration document will record the first transaction from the builder/dealer to the private buyer.

How do you think the market in France works if their documents are not acceptable? Many Brits have bought boats from France with these documents - including a forum member who has done just that.

 

[Tranona]

My understanding on this is that a non EU boat is not liable for VAT registration in the EU for at least 18months; during which period you have a TI - Temporary Import status.

Beyond that you would need to pay VAT.

So if you have paid VAT (in the EU) and can prove it, then no problem. If you haven’t or can’t prove it, then you have 18 months in EU waters with no issues. Thus, unless your moving the boat to the EU you shouldn’t have a problem.

No. That is wrong. TI is a completely different thing and only applies to non EU residents. It has its own set of rules which can be found in HMRC VAT notice No8.

Not relevant in this case as the boat is VAT paid in France so can move freely around the EU including being bought and sold without further VAT payment.

 

[Deleted User YDKXO]

This is a UK perspective and simply not relevant for a French registered boat. If it has the documents I suggested then that is proof of VAT paid. Just because it is done differently in the UK is not a good reason for saying the French system is flawed. It is only in the UK that the original invoice is considered the primary evidence of VAT payment, simply because we do not have an official record of payment unlike France and other EU states.

Equally the builders certificate is not an essential as the registration document will record the first transaction from the builder/dealer to the private buyer.

How do you think the market in France works if their documents are not acceptable? Many Brits have bought boats from France with these documents - including a forum member who has done just that.

Tranona read the original OP's post. This boat has been brought in France and is now being sold in the UK so I suggest that the perspective of the UK market applies. And I never said that the builders certificate demonstrates ownership. What it does demonstrate is provenance in that the date of manufacture is given on the certificate and the HIN given on the certificate obviously should match that on the boat to confirm that

 

[kennyh]

No. That is wrong. TI is a completely different thing and only applies to non EU residents. It has its own set of rules which can be found in HMRC VAT notice No8.

Not relevant in this case as the boat is VAT paid in France so can move freely around the EU including being bought and sold without further VAT payment.

But the point is, if they cannot prove EU VAT paid status AND the UK is no longer an EU country (soon sadly to be the case) then the UK owner can take the boat to the EU for 18months with a TI and not have to pay (any additional) VAT during that term. I am of course ignoring the fact that it might have EU VAT paid status if the owner argued hard enough.

I’m just trying to point out that the owner should be fine for any trip less that 18months in EU Waters.