Buying Privately

[masterofnone]

Structural survey

I would strongly recommend a survey. A 2004 5.0m Quicksilver was next to me in the marina, broker sale to guy from Brighton, paid £12k. Took it out for a spin only for it to sink when keel delaminated. details follow for your info
this is going to be a long one so i'll try and keep it short
my mate bought a quicksilver 500 pilothouse from a reputable shop in newhaven 3 weeks ago,he agreed a price of £11700 for just the boat engine electronics etc,he was taken for a test drive and all was fine,the boat has been in the water on a mooring for over 18months he was told anyhow he sorted his finances and made the call to transfer the funds from his account to there account and the next day they phoned him to say they got there money and it was ok to collect the boat,on the next day on friday i went with him to move the boat to brighton marina, it drove to the marina ok no problems noticed,we decided to go out fishing on the saturday,went fishing around 11am got out about 3 miles and i noticed the bilge pump working so just thought it was rain water from previous rain so didnt really take much notice
came back in around 4pm and the pump was still working overtime so was getting a bit concerned by then,then the pump stopped so we left the boat on its mooring then at 8am on the sunday he gets a call from the marina to say the boats sinking on the mooring,goes down there and its literally sunk with the engine just above water,marina had all there pumps going to get it pumped out and around 3 hrs later it was all pumped out,so i rang the shop where we got it from and they said can you try and get it to their slipway which was nearly 10 miles away,so i said we can try,all the electronics and engine were ok on the boat and it didnt look like it was taking in water that fast so i said yes lets go so we allerted harbour master as to what we were dong etc just in case we managed to get to newhaven ok going very slow got it on to there yard trailor and the damage underneath is unbelievable theres gelcoat missing about 5ft long and about 2ft wide never seen anything like it in all my life,its down to bare fibreglass ,,,,the man from the shop kept saying to us what have you hit and we kept saying we hadnt hit anything but he didnt want to believe us then he said he'll get a specialist to have a look at it the next week so we left it with them,in the mean time we got our own specialist to look at the boat and he said the boat hasnt hit anything its a fault with the boat and its going to cost aroung the 3k to get repaired because the other side of the hull is going the same way
so armed with this information we go into the shop and say he wants his money back because he only had it for 1 day and the boat was damaged when it was sold to him,
they tell him it wasnt there boat in the first place it was a commision sale and if you have any problem then take it up with the previous owner,surely if they have it for sale on there website,they took my mates money then they gotta be liable
this is the boat they sold ,
Caveat Emptor, a fool and his money are easily parted.

 

[Whitelighter]

Is it just me that is missing something here

How can a UK vat registered company legally sell a boat it owns in the UK to a UK resident to be used in the UK without charging VAT

Erm, easily.

If you buy a second hand car from a big dealership, do you pay VAT? Nope, you don't because the VAT is only paid once.

If this company bought the boat second hand, from a private individual then the VAT has been paid and the company, VAT registered or not, cannot claim it back. When they come to sell it, there is no VAT dues so no VAT will show on the invoice.

 

[DAKA]

Erm, easily.

If you buy a second hand car from a big dealership, do you pay VAT? Nope, you don't because the VAT is only paid once.

If this company bought the boat second hand, from a private individual then the VAT has been paid and the company, VAT registered or not, cannot claim it back. When they come to sell it, there is no VAT dues so no VAT will show on the invoice.

Thank you, I had over looked the possibility of the company buying in secondhand, and in any event I had previously thought a VAT reg company had to charge VAT on everything sold.

It sort of leaves it open for VAT scams

Anycompany Ltd buy a boat hull for £10 000 vat paid
Buy twin diesels for £50 k + VAT
Furnishings £50k + VAT
Nav gear £10k + VAT

Being VAT registered they claim all the upgrade vat back. £22k

Then they sell the boat without charging VAT but stating its a VAT paid boat ( originally paid but not claimed back).

 

[Phill]

If a VAT registered company buys a new boat and claims the VAT back, they will need to prepare a sales invoice showing VAT on the sale and pay that amount back. That's what I thought anyway.

 

[Whitelighter]

Yes, that could happen, though I wouldn't like to sit through the VAT audit

When a VAT registered co. sells a second hand item VAT is paid on the profit margin, not the goods

 

[Whitelighter]

If a VAT registered company buys a boat and claims the VAT back, they will need to prepare a sales invoice showing VAT on the sale and pay that amount back. That's what I thought.

Yes, that is true.

But if they buy a boat second hand from a private individual, or a company that can't/hasn't claimed the VAT back then there is no VAT to pay, so they cant claim any back and don't need to charge it when they sell

If you have a VAT invoice for the boat from at least one transaction in its past, for many reasons, as an individual you are covered

 

[MapisM]

You started the pedantry so I guessed it was ok

LOL, guilty as charged...!
Yep, coming to think of exempt vs. zero rate, you already mentioned such difference in some previous thread.
All academic indeed, anyway.

 

[fireball]

When a VAT registered co. sells a second hand item VAT is paid on the profit margin, not the goods

OO ... I didn't know that ... (mind u - gave up VAT many years ago ... along with all things accountancy!) learn something new everyday ... thanks!

Link to HMRC on the subject:
http://www.hmrc.gov.uk/vat/start/schemes/margin.htm

VAT margin schemes for second-hand goods, art, antiques etc

Normally you charge VAT on your sales, and reclaim VAT on your purchases. However, if you sell second-hand goods, works of art, antiques or collectibles, there may have been no VAT for you to reclaim when you bought them. You may be able to use a VAT margin scheme. This enables you to account for VAT only on the difference between the price you paid for an item and the price at which you sell it - your margin. You won't pay any VAT if you don't make a profit on a deal. You can still use standard VAT accounting for other sales and purchases such as overheads.

 

[Jim@sea]

I would strongly recommend a survey.
this is the boat they sold ,
Caveat Emptor, a fool and his money are easily parted.

With respect. And I am grateful that you have gone to the trouble of detailing what was wrong with this Quicksilver. This should be given its own listing on the PBO forum, not buried away in a listing about VAT and ownership issues.
A Quicksilver type boat is what was on my list to be considered in the new year when I start looking for my next boat. Your blog certainly makes me aware that they dont make boats like they used to do. Certainly when they make these " Boats to Trail" do they assume that the boat will be out of the water for the majority of the time and the fiberglass lay up be lightened accordingly. like the discussion about Indespension Trailer Bearings, they make trailers to tow, but the trailers get "Dunked" in one of the most corrosive liquids on the planet (sea water) but the hubs are the same as a horse trailer.
Anyway perhaps it is only people new to boating that would buy a boat without seeing it out of the water. 30 years ago I bought a Quality 9 year old boat which had Osmosis, I had a survey but the surveyor missed it, And in this occasion you have no redress against the Broker. Like a Car Auction they are only acting as agents.
Certainly Quicksilver should be asked if they will contribute to the cost as if another boat like this appears with the same problem Quicksilvers will be worth peanuts.