Does this worry those of you who keep boats in spain?

Re: Apologies for repeating myself, but...

Well GBN as I've owned sucessful business's for 30 years, including yacht charter in 4 countries, I do have a little knowledge about VAT and accounting. Intrestingly if HMRC do not have sepecific records of yachts, how come until recent times MBY were advising readers to obtain proof of VAT payment from Customs & Excise yacht unitprior to making any journey to other EU countries? I still have in my possession a certificate of VAT paid on a previously owned yacht issued by C&E in 2004 which includes details of when & where the yacht was built which information was not supplied me.

You are correct in saying that a boat is classed as ' a new means of transport' and as such is treated in different ways depending on its destined use, be it commercial or private, however, if the vessel 'belongs' to a member state of the EU then VAT should have been paid on it either at purchase when new or on entry to the EU and the onus is on the user / owner to show that payment has been made at some point, if required.

Until recently HMRC have been relitively slack on checking yachts for VAT payment, however the new 'boarders' system is being put in place not only to control people but 'asset' movements, as well as the more obvious 'drug smuggling issues, and as for Spain - well certainly the marinas I've based in have always insisted on a copy of the purchase invoice on their file, plus copies of every other document that you may have ever had in your hand including the passport, insurance and part 1 or SSR. The original purchase invoice is part of ships papers folder on all of my yachts - at the end of the day "status" or not, unless the yacht is seriously big with lots of crew and a management company in the Caymens, and its in EU waters it has to have had VAT paid on it and the customs in all EU Countries have a right to see that proof if requested - lets see, then -a copy of the invoice or VAT payment document issued by an importing clearing agent or a friendly wave of the hand to the large gentleman with the gun saying "VAT was paid on it at sometime or another but I can't be bothered to prove it to you" and hope that the 'force' is with you, that day... Ummm thats a hard one.
 
Re: Apologies for repeating myself, but...

That doesn't answer the question at all. Sure, if I have a boat in Jersey and import it to EU, and I fail to pay the VAT which I am due to pay, Customs can seize the boat and my other assets.

But that isn't the point at all. Let's say Mr A imports the boat from outside EU into UK and fraudulently fails to pay the VAT due by him at import. A year later Mr B buys the boat in good faith from Mr A. Then HMRC discover the incorrect importation by Mr A. Now, show me the law that says HMRC can seize Mr B's boat, let alone make Mr B pay Mr A's tax bill. Don't show me some poxy leaflet about seizure in general, which of course can be lawful in certain circumstnaces. Show me the law that says Mr B's personal assets can be seized to pay Mr A's personal tax liability. Go on, stop writing horsecodswallp and show me the law. It's all on line, clickable links above, searchable text.

Case of champage ready if you PM me a delivery address.
 
Re: Apologies for repeating myself, but...

[ QUOTE ]
just to make it clear to the people here

[/ QUOTE ]

You've got a bludy cheek GBN. In a post above you wrote "if Revenue decide that VAT was not correctly accounted for in any previous transaction , they have the right to seize the asset ".

Now you say "just to make it clear" that a subsequent innocent boat owner isn't liable to lose his boat to pay the unpaid taxes due by a previous importer

You are making it unclear. Get your facts and knowledge of the law straight before posting horsecodswallop like "if Revenue decide that VAT was not correctly accounted for in any previous transaction, they have the right to seize the asset ".
 
Re: Apologies for repeating myself, but...

[ QUOTE ]
I do have a little knowledge about VAT and accounting.

[/ QUOTE ]Mmmm... When you said that "if the manufacture does not have that record then HMRC will have a record of the original sale of that vessel", indeed you showed a little knowledge of accounting....
You surely have some experience on this matter, but not on the technicalities behind it, methink... /forums/images/graemlins/wink.gif
 
Re: Apologies for repeating myself, but...

Blimey, this is being even more confused by you guys. On HMRC records, you're both right. HMRC do have VAT recods of specific yachts where they are imported, but not where they are sold by VAT registered businesses.

A boat isn't an NMT once it's no longer new. I forget the thresholds but after 75 engine hours, a few months, etc, it is no longer "new". So the vast majority of 2nd hand boat sales (where the issue of VAT invoice comes up, cos it doesn't arise on new boats) are not NMTs. NMT rules are therefore red herring in this debate

And boats do not universally have to have VAT paid on them in EU. Some do, some don't, depends on cuircumstnaces. Having a management co in the Caymans has sod all to do with EU VAT liability
 
Re: Apologies for repeating myself, but...

Well said Mapis, quite correct. It also shows little knowledge of how big a database would be needed for HMRC to hold records of every asset sold in a £1trillion + GDP economy like the UK's :-)

Cynics can chip in here that 75% of the UK GDP is of course services not goods, but that's still some database :-)
 
Re: Apologies for repeating myself, but...

Yeah, but.
We have some genius down here who were considering, not too long ago, to develop a centralized invoicing database to which every VAT subject should have submitted each invoice issued. Managed of course by fiscal authorities.
Not such a stupid idea, if you think about it.
Thanks to such database, every VAT subject could forget to both send invoices to its customers, and get them from its suppliers: just a matter of feeding/accessing the central database. And take the VAT declarations/payments/refunds: they could have been completely automated.

I just can't imagine what sort of nightmare would have been the development and management of such system...
...not to mention integrating it with other EU Countries!!!
/forums/images/graemlins/laugh.gif
 
Re: Apologies for repeating myself, but...

"if the vessel 'belongs' to a member state of the EU then VAT should have been paid on it either at purchase when new or on entry to the EU and the onus is on the user / owner to show that payment has been made at some point"

Nope VAT law does not put the onus on the user/owner, its puts the onus on the importer.

I do have a little knowledge about VAT and accounting. Intrestingly if HMRC do not have sepecific records of yachts, how come until recent times MBY were advising readers to obtain proof of VAT payment from Customs & Excise yacht unitprior to making any journey to other EU countries?"

the reccomendation in the magazines are usually rubbish. There is not universal proof of VAt paid. where specific importations took place HMRC may have specifics, see other posts. But there is no recording of specific boat data between VAT registered companies

"the new 'boarders' system is being put in place not only to control people but 'asset' movements,"

Complete scaremongering, no evidence and goes against the stated e-borders inititive. theres no evidence to suggest this is a feature of e-borders. There currently no agreement on how it will be applied to arrivals by yacht and is not expected to be before 2010 ( see rYA briefing doc)


"well certainly the marinas I've based in have always insisted on a copy of the purchase invoice on their file, plus copies of every other document that you may have ever had in your hand including the passport, insurance and part 1 or SSR. The original purchase invoice is part of ships papers folder on all of my yachts - at the end of the day "status" or not"

your leaving the planet now. In 17 years of various deliveries in and around teh med including spain, never once bben asked about VAT. Marinas want insurance and proof you are the responsible person in charge( ie skipper or owner). Nothing more. They have zero interest in VAT unless its a non-EU boat. If you were right there would be countless hard cases of people screaming about VAT paperwork, and funny there aint.


"and its in EU waters it has to have had VAT paid on it and the customs in all EU Countries have a right to see that proof if requested - lets see, then -a copy of the invoice or VAT payment document issued by an importing clearing agent or a friendly wave of the hand to the large gentleman with the gun saying "VAT was paid on it at sometime or another but I can't be bothered to prove it to you" and hope that the 'force' is with you, that day... Ummm thats a hard one.
"
(a) IN EU waters IT DOESNT have neccesasary tgo have VAT paid. -fact ( it could be owned by a VAT registeredt company)

secondly As I said before foreign customs have no right or interest in whether you have paid UK vat or not. They are merely interested in ensuring your are not attemtping to imprt the yacht, National registration documents for example are always accepted as meaning the boat is leaggaly in the EU

I'm sorry 1955chris, you are making hearsay and rumor into supposed policy


And Jfm, I have already clarified my posiiton on seizures, YOU ARE RIGHT, and I have said it, If you a do a valid sale in the EU you have no VAT liability and the asset CANNOT be seized and there is no evidence whatsoever that so VAT inspections or seizures have ever taken place
 
Re: Apologies for repeating myself, but...

"your leaving the planet now. In 17 years of various deliveries in and around teh med including spain, never once bben asked about VAT. Marinas want insurance and proof you are the responsible person in charge( ie skipper or owner). Nothing more. They have zero interest in VAT unless its a non-EU boat. If you were right there would be countless hard cases of people screaming about VAT paperwork, and funny there aint."

I'm not leaving the planet... sure if your moving a boat from marina to marina they want the usual, BUT when you get to your permanant base marina they want the full monty including sight of VAT papers and bills of sale, and I'm reliably informed by a friend of mine who manages a marina office in Spain that the various athorities DO vist them on a regular basis to inspect the said documents... and act upon their findings.... and with Spain as an example, once your registerd on one marina's computer - then your on all of them.

"Nope VAT law does not put the onus on the user/owner, its puts the onus on the importer"

Possibly, but are you going to argue the toss with the Customs officer asking YOU the question in broken English who really dosn't give a toss about you or your boat - but its his job and he's doing it so when he abruptly asks you for "PAPERS PLEASE" isn't it easier to give him the paperwork?

"Complete scaremongering, no evidence and goes against the stated e-borders inititive. theres no evidence to suggest this is a feature of e-borders. There currently no agreement on how it will be applied to arrivals by yacht and is not expected to be before 2010 ( see rYA briefing doc)"

Your very naive if you think that the system is just to control people movements - its another way for the Government to control us fully - there are more border controls in place now than before we joined the EU and certainly yachts and their contents be it people or otherwise WILL be scrutinised by the new e-borders agency on every movement - and remember be it a proposed feature or not, the government said they wouldn't put taxes up when they came to power - ohhh wooops!!!


"(a) IN EU waters IT DOESNT have neccesasary tgo have VAT paid. -fact ( it could be owned by a VAT registeredt company)"

Not really sure where your going, here - what has being owned by a VAT registered company got to do with VAT being paid on a yacht...? just because the companies VAT registered does not mean that everything it owns has VAT paid on it and does not give it a right own assets with out paying the VAT, if due...

"secondly As I said before foreign customs have no right or interest in whether you have paid UK vat or not. They are merely interested in ensuring your are not attemtping to imprt the yacht,"

'Foreign' or EU Customs have every right to request proof of VAT payment... and anything else that they wish to ask you for - sadly the UK is no longer an independant force - all EU countries customs departments are gradually being bought together and its only a matter of time before they are all one and the same.... but in the mean time they have as much right to ask as a HMRC officer, does- full stop.

"National registration documents for example are always accepted as meaning the boat is leaggaly in the EU"

Now whos talking horsecodswallop... A national registration document such as part 1 or SSR shows the nationallity of the vessel, and with Part 1 provides a traceable record of the vessels existance and possible ownership, but it does NOT prove that the vessel is legally in the EU - and it DOES NOT show that the vessel has had VAT paid on it be it at the original purchase when new or when Imported.


And finally......

If as you say, the term 'VAT Status' does not exist how come vitually every yacht broker throught out the EU but especially in the Med always list the yachts for sale as 'VAT' or 'taxes' paid or 'plus VAT' - they must know something that you don't!

And Finally, Finally...

For people reading this thread who are considerling taking a yacht to Europe - my advice for an easy life is carry all of the right paperwork with you including proof that VAT has been paid at some point in the past...
... and for potential purchasers of a used craft - if your spending more than £10 on it ask to see every peice of paperwork that was ever associated with the craft including the proof that VAT was paid, plus a service history and an ownership trial - remember It might have a part 1 but it dosn't mean that its the sellers yacht to sell - but thats another thread.
 
Re: Apologies for repeating myself, but...

Ref your last para and taking boats to europe, maybe the difference is spain versus everywhere else. spain is a quick run from Africa and Gib, 2 VAT-free places, so if folks were going to buy VAT free boats and illegally import to EU Spain (or Portugal) would be the first stop. Perhaps that's why Spanish officials are more likely to be suspicious. They aren't at all suspicious in France or the UK. No one is ever asked for VAT invoice in UK, even if returning from cruise in Guernsey/Jsy, and hardly ever in France

But even in Spain I still think it's a pity the urban myth continues. Sure, a VAT paid doc is useful if an awkward Spanish official boards your boat and is worth having for that reason. But it's important to understnad that's the reason for wanting the doc. It is not that you're actually peronally liable for a previous owner's unpaid VAT. And for UK readers who are the largest group on this form, let's be crystal clear that if Mr A illegally fails to pay UK VAT due on a boat then sells it to Mr B in the UK who buys it in good faith but doesn't get a VAT document, Mr B is never liable for Mr A's VAT and the UK HMRC have no right to seize the boat to collect VAT, despite the contrary statements (partly "clarified", ie retracted) written above.
 
Re: Apologies for repeating myself, but...

[ QUOTE ]
"National registration documents for example are always accepted as meaning the boat is leaggaly in the EU"

Now whos talking horsecodswallop... A national registration document such as part 1 or SSR shows the nationallity of the vessel, and with Part 1 provides a traceable record of the vessels existance and possible ownership, but it does NOT prove that the vessel is legally in the EU - and it DOES NOT show that the vessel has had VAT paid on it be it at the original purchase when new or when Imported.

[/ QUOTE ]

Not sure this is relavant but:

My boat once broke down in Guernsey, (outside the EU). I had to have it shipped back on a container ship to Weymouth. When it arrived I went along to collect it not really thinking about any implications with HMRC. I arrived and they started to deal with me as if I was importing the boat from outside the EU. I tell them the boat is already mine and explain the situation. They request some paperwork to prove this and mention that I may be liable to VAT and import duty. At this point I was a bit panicky cos I don't have a VAT receipt like many other used boat owners.

Luckily the only bit of paper I had on me is the SSR certificate. Once they had seen that they were more than happy that no VAT or Duty was payable and I was left to go on my way.

A close shave maybe, but it has made me a lot less concerned about the whole VAT issue, especially on old boats on their second, third or more owner.
 
Re: Apologies for repeating myself, but...

I've been following this discussion between you, jfm and gbn with great interest. I don't believe that I have sufficient knowledge to add anything of value to the discussion which is why I've kept out of it but I do feel that anyone reading this thread might come way with the impression that proof of VAT paid paperwork might not required when buying a used boat. Whilst I understand and agree with most of the concepts that have been discussed, IMHO it would still be foolish not to insist on proof of VAT paid paperwork when buying a used boat for 2 reasons. Firstly, whilst nobody has yet given a specific documented instance so far of a boat being impounded for not having this documentation, that is not to say that customs authorities in one or more EU countries might not change their policy in the future and, I, for one, would not want to be arguing legal semantics with the likes of the Spanish Guardia Civile on this issue. Secondly, AFAIK, UK finance companies are still asking for proof of VAT paid documentation for marine mortgage facilities. Now, they may be wrong to believe that the documentation is necessary but the fact remains that they are still asking for it and, in any case, as I have said before, whether a boat is VAT paid or not goes to determine it's value and, hence, how much a finance co might be willing to lend on it. Even if a purchaser does not require a marine mortgage, it still makes sense to obtain proof of VAT documents because a subsequent buyer of that boat might require a mortgage or simply insist on having that documentation in order to proceed with the purchase
So, in strict legal terms, whilst it may not be necessary for an owner to provide proof of VAT paid documents, I think it would be stupid not to have these documents available based on my points above
 
Re: Apologies for repeating myself, but...

Certainly Spain & Portugal are extreamly keen when it comes to policing boat movements... I have been stopped on several occassions on passage from Gib up the Spanish med coast by the Guarda Civil patrol boats and on several occassions have had to report to their port office with all papers - but never had a problem because everything was in order.

In Apl 2008 I delivered a Motor yacht from Spain to Turkey with 9 stops and only in both Messina, Sicilly and Argostoli, Greece was I asked for any papers at all - both officials took copies of the original invoice along with part 1, insurance and passport, and in Greece the paper work trail took over an hour, which included a second full run over of the paperwork by the guys superior. Again everything was in order - but in Greece I was specificly asked for "VAT papers" after giving the rest, first, and I would not like to think what might have happend if all had not been available for inspection.... I might well still be there.
 
Re: Apologies for repeating myself, but...

I Agree, Deleted User and would suggest that the finance companies also use the documented proof of VAT payment as a form of insurance that the yacht will not be impounded for non payment should the relivent authorities see fit.
 
Re: Apologies for repeating myself, but...

You were lucky... but as you had visited Guernsey it was relitively easy on return to persuade the English speaking officials that all was well, but lets say you had broken down whilst cruising in say, Marocco and wanted to take your yacht to say, Malaga - would it have been as easy - I think not!
 
Re: Apologies for repeating myself, but...

Sticking entirely with UK law for the moment. It's a bit like "Trespassers will be prosecuted". They can't be because trespass isn't a crime. Equally no-one knows of any law which means that the boat you bought privately from me can be seized by HMRC because I didn't pay VAT when I imported it.

Nevertheless, I entirely accept your comments. So many people believe that you are at risk because if you haven't got a VAT receipt that it has become the conventional wisdom.

An example: I lost a few £k when I sold a boat to a dealer 18 months ago: he said, "No VAT receipt, so I'll pay you 40/47's of what I would otherwise pay." I said, "But it's not relevant." He said, "This is what I am prepared to pay. Take it or leave it."

Now he may have believed that he needed to have a VAT receipt to avoid being chipped when he sold on, or he may have just found a convenient excuse to chip me. I wanted to get shot straight away (next boat was about to turn up) and I couldn't be bothered to look for another buyer.

Perhaps it suits HMRC that this belief is so prevalent, that people believe their boats can be seized for other people's debts.
 
Re: Apologies for repeating myself, but...

All agreed Deleted User and I've said the same, though it might have been lost in the other VAT ramblings I was writing /forums/images/graemlins/grin.gif. I just think it's important that folks realise that the VAT docs are desirable for the reasons you give, and not because the boat can or will actually be seized to pay someone else's tax debts. And it's good for people who dont have a VAT doc or have lost it to know that while they might have a hard time with officials (more likely in Spain it seems), all is not lost for them and they do have a leg to stand on.
 
Re: Apologies for repeating myself, but...

[ QUOTE ]
Once they had seen that they were more than happy that no VAT or Duty was payable and I was left to go on my way.

[/ QUOTE ]Which goes to prove that also HMRC officers can make mistakes!
 
Re: Apologies for repeating myself, but...

[ QUOTE ]
[ QUOTE ]
Once they had seen that they were more than happy that no VAT or Duty was payable and I was left to go on my way.

[/ QUOTE ]Which goes to prove that also HMRC officers can make mistakes!

[/ QUOTE ]

They hadn't made a mistake. There was no VAT or Duty owed on the vessel.
 
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