Buying a non VAT paid boat in france

[onespeed]

Id appreciate some advice on the following situation regarding a boat I wish to buy;

The first owner lived in Guernsey hence the boat was originally purchased without VAT being paid 2014.
The bought was advertised and then sold from the UK by a broker as a VAT-not paid boat.
The second owner (who is the vendor) bought the boat and did not pay VAT in the UK or France.
The boat is currently in France, owned by a French national who is the company director of a boat business which owns the boat. The boat has been chartered.
The boat is to be left (unused) in a marina in France.
I plan to bring the boat back to the UK (early April) and pay the UK VAT.
The vendor believes I can buy the boat (french) VAT free and pay VAT in UK.

My question/concern is will I be liable for paying French VAT or is it reasonable to assume that because the boat will be exported back to the UK it can be sold VAT free and the VAT paid on importation to the UK. In short I dont want to pay VAT twice.
If I was able to buy the boat today and sail it back tomorrow I wouldnt be concerned but because I will need to wait for 6 months I am concerned.
Im interested in this boat because they are rare in the UK.

thanks

 

[Tranona]

If the boat is owned by a French VAT registered entity then they can sell it to you VAT free for export, but it is up to them to make the arrangements for this. You will then pay VAT in the UK.

However, this is the least of your worries as you will need to get the boat certified before it can be used legally in the UK. This may or may not be straightforward depending on the make/design of boat and its age as from 1/1/2023 it will need to conform to the current rules and standards, not those that applied when it was built. Before you commit to anything suggest you take advice on this. If you are a member of the RYA that would be a good starting point.

 

[westernman]

Depending on whether it is from a major builder or not, the certification process may be straightforward or not.
The current rules were developed in 2013, but did not become mandatory until 2017. However the new emissions rules for engines (the most expensive bit to get to conform) came out earlier in 2006.

Assuming you can find out what it would take to get certified to the current rules, I would get the owner to undertake to deliver it to the UK before the sale takes place to be sure there is no surprise with French VAT.

The buying process in France is usually a two step process - first with a "compromis". I.e. an undertaking that the seller will sell and the buyer will buy subject to certain conditions. E.g. the boat being in a certain location, the successful conclusion of a sea trial etc.

You could sign the "compromis" in France (usually 10% non-refundable deposit unless the sea trial is not successful or one of the other clauses for the compromis contract comes into play). And then sign the final sale contract in the UK.

Just some things to think about.

But you really need to get an expert involved.

 

[Irish Rover]

For what it's worth I'll recount my experience of buying a VAT unpaid boat in Greece in 2017. The seller was Swiss and had the boat in Greece on 18 months temporary importation. I'm an EU citizen but permanently resident in Türkiye.
Initially when they assumed I was a an EU resident the Greek customs said I could get a one month transit log to afford me time to take the boat out of the EU. When I satisfied them I was non EU resident they renewed the Temporary Importation and issued a new 18 month transit log. The boat stayed in a boat yard from November until I was able to sail it back to Türkiye in April.
Based on my experience I think it would be well worthwhile getting someone to visit the local customs office and ask the question directly.

 

[onespeed]

thanks all, this is helpful and promising.

 

[Tranona]

Don't think you will have any problems either side with VAT. As suggested once the boat is yours, as a non EU resident you can keep the boat in France for up to 18 months. Worth clarifying with the vendor and the local Douane what the process is for this. When you sail the boat to the UK the process is straightforward. This is the guidance from HMRC www.gov.uk/guidance/sailing-a-pleasure-craft-that-is-arriving-in-the-uk and well worth getting in touch with the special unit in Portsmouth that deals with pleasure craft imports to make sure you have everything agreed in advance.

Certification to import the boat into is a very different issue, in part because the new post Brexit rules have not yet been fully implemented, but will be by the time you want to import the boat. It is a legal requirement to have an imported boat certified according to the latest standards before it can be "placed on the market" in the UK. The legislation is based on importing for sale commercially to ensure fair competition, but applies to private imports as well. The actual standard does not deviate currently from the RCD and for recent boats compliance seems to be mainly a paper exercise, but for older boats even with a CE mark it may be problematic, particularly in respect of major bits of equipment like engines where there was a big change in the standards in 2013. Because of this uncertainty it is really important to take advice now as to how your boat will be treated under the new rules as you could end up owning a boat you cannot use legally in the UK, or at the least have a big bill for making it compliant.

This is not a trivial matter as a similar situation arose in the late 1990s after the introduction of the RCD across Europe in 1997. Prior to that there were no standards in the UK and importing used boats from the US was quite popular. Many people got caught out and had their boats impounded on import, some having to re-export and others faced high costs of modifying their boats and having them assessed against the new standards. The costs and hassle effectively killed the trade in importing boats privately from the US except for the very small number where the builders had their boats assessed against the RCD (Island Packet is a good example and there are some small power boats that can comply) or were originally built in the EEA.

Even if our standards don't deviate from the EU the cost of compliance plus the payment of VAT will kill imports from the EU. You don't have the VAT issue as presumably you are happy with the UK VAT paid price for the boat but it would be wise to ensure in advance that your boat can be certified economically.

There is very little in the public domain about this issue, I suspect because very few people have been through the process so please keep us informed as to how you get on.

 

[westernman]

For the certification it is worth getting hold of all the information about the original certification. There is usually some agency somewhere which will have a record. This could be used to potentially reduce the certification effort to a check box exercise - looking at the original documentation and rule, noting that the new rule is the same and checking the box.

May be.

 

[MikeBz]

There is an article one YM’s website dated April 2022 which has this update added:

“UPDATE ON 22 November 2022:

The UK Government now says that CE marking alone is sufficient until the end of 2024.

From 1st January 2025, a UKCA mark is necessary but if the product was already CE compliant pre 1 Jan 2025, a sticky UKCA label needs to be affixed next to the CE mark and the product can then be declared to meet UK regulations using their CE certificate.There is no need to have a UK certificate, until 2028.

New products, CE marked from 1 Jan 2025 will need to have full and proper UCKA compliance.”

Does that update only apply to new boats, not secondhand ones?
Link: Second hand boats: CE mark headache for sailors? - Yachting Monthly.