Ex-VAT with the toys

[cliffdale]

In my hunt for the perfect boat, Ive seen a few ex VAT fully kitted out with almost electronic everything. In 15 years of sailing Ive never been asked for vat receipts. Is there a way of not paying vat? Would summer in uk and winter in CI work?

Probably an well exhausted question but the vat is a massive saving.

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[jfm]

When you buy it you will be invoiced the advertised price plus the VAT. So you can't avoid at source, unless you get it delivered offshore and prove that to seller. Once you have paid the VAT you can get refund of it but that's the complex bit. But you can't just buy it and not pay vat and hope no-one notices

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[cliffdale]

How about private sales not through a company.

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[cliffdale]

Shhh- Keep Quiet

Its gone very quiet on this one. Bet you've all got tax free boats and PM each other, keep quiet he's a raggie!

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[Divemaster1]

Re: Shhh- Keep Quiet

You may find some interesting stuff here:

<A target="_blank" HREF=http://www.yachtsmann.com>http://www.yachtsmann.com</A>

or

[urlwww.angloirishbank.co.[/url]

Basically buy the boat, register on IM, and let them handle for a fee, then they issue VAT Cert., & Give "Beneficial VAT arrangements"

<hr width=100% size=1>Alf

 

[tcm]

Re: Shhh- Keep Quiet

last time i commented on vat free things we had a vatman calling about an inspection two hours later!

but jfm is right - you pay vat on the purchase and the company selling the vat will have to prove it charged the vat and will want to charge it - cos it will get charged the amount of vat by the revenue. So, you pay the VAT. Or your company pays the VAT.

Now the fun starts with you trying to recoup the VAT. You have to show that you aren't "consuming" and hence aren't just having a vat-free boat.

Lots of people leap throgh hoops and pay vast fees to avoid VAT - but remeber that the only saving is the VAT on what you buy and what you sell at. So if you buy a 200k boat, and sell it for 160k, the vat paid or lost is only 7k. yeah, ok plus the interest on the other £28k. But registering in offshorish place rings alarm bells so expect lots of inspections and hassle. Essentially, you set up a company and charter the boat a bit or a lot, so it's a proper company, and charge and claim vat. Yup, you can save the vat on electronickery as well, everything can go through.

Of course, the very naughty way of avoiding vat is to pay cash. This is illegal of course but there again ...er excuse me the the phone is ringing and erm what? oh damn...


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[Deleted User YDKXO]

There's 4 ways you can avoid some or all VAT. Not paying it + hoping for the best is not one of them
First, you can buy a new boat or ex-VAT used boat in the UK, pay the VAT, take it outside the EC and reclaim the VAT. Outside the EC means somewhere like the Channel Islands but the first time you land back in the EC, France for example, VAT is due
Second, you could set up a charter company which buys a new or ex-VAT used boat, pays the VAT and reclaims it on the next VAT return. This sounds great except the Revenue is wise to this and will expect to see some evidence of business activity and they will hit you with a benefit in kind for personal use anyway. This is a viable option but you need a good tax accountant to set it up and negotiate with the Revenue on your behalf. However, you will have to spend say £5k having the boat coded to MCA spec and do you really want somebody else using and abusing your pride and joy?
Third, apparently, there is some kind of leasing scheme located in Belgium which, due to a peculiarity in Belgian law, allows VAT to be reclaimed on a boat purchase. However, the cost of setting up the lease is supposedly about 7-8% of the purchase price and then you pay interest in the lease payments.
Fourth. You buy an ex VAT used boat in Spain and have it assessed for VAT in Spain. Apparently, the local Customs use some kind of rule book to value the boat which effectively under values it compared to its true value and then you pay Spanish VAT on the low assessed value which saves you a few bob. There are local agents who will handle this for you

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[cliffdale]

Re: Shhh- Keep Quiet

So if I buy a boat to charter out, I get tax free fuel, toys,alarms etc? Mmm, I'll have to speak to Sun_coast about this one.

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[EME]

Option 3

I looked at that ( as seriously as I look at anything) in France( same system) . However the actual costs were more expensive than paying the VAT in UK and financing through one of the marine finance houses... That was about 8 months ago .

<hr width=100% size=1><font color=blue>I am WHAT I say I am</font color=blue>

 

[hlb]

Re: Shhh- Keep Quiet

Well course I've paid all my vat bills, but must admit. No one has ever asked me where I got my boat from, or the electronic thingies, or even my washing machine at home. No nothing ever. Course they have at work, But thats different.

<hr width=100% size=1> <font color=blue>No one can force me to come here.<font color=red> I'm a volunteer!!.<font color=blue>

Haydn

 

[Deleted User YDKXO]

You're right. I was told it only starts to make sense for boats in excess of £250k

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[jfm]

further detail on Deleted User\'s points

Deleted User is right, a few extra comments. I'm not going into massive detail here ahem

!st solution quite correct. Actually if you export it immediately you dont have to pay the VAT then apply for refund, you can get the seller to zero rate the invoice. The point is, it's seller's risk so you need to convince the seller you are actually gonna export the boat. Easy for a new boat, the seller will deliver it to your jersey berth

2nd solution works better if you use a limited partnership instead of company. Depending on the source of your wealth that paid for the boat this can avoid the (otherwise massive) benefit-in-kind tax problem. This is complex and the only consultant I'm aware of who set it up (for a quite large boat)charged £50k fees.

3rd solution works in France Italy and Belgium and as mentioned it suits expensive boats. With interest rates as low as currently, it makes good sense.

4th solution might work in UK. Customs have to value the boat at import and some dealers say that they have pre agreed guidelines whereby Customs will accept a valuation that is quite reasonable. This is just rumour, I dont know the details and I've never imported anything as valauble as a boat so this is just anecdotal, possibly rubbish

 

[Happy1]

Am I the only mug on this forum who has paid in full for his boat as a non company purchase AND paid the VAT? Seems that there must be a few interesting financial transactions going on in some purchases /forums/images/icons/wink.gif

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[Happy1]

Re: Shhh- Keep Quiet

That's what you get for being a copper Haydn /forums/images/icons/laugh.gif

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[tcm]

Re: Shhh- Keep Quiet

um, tax free praps but not duty free (which is where the big savings wd be)

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[tcm]

Re: france, in excess of £250k

the french boat leasing system is delightfully slotted into the ratings for a boat. Essentially, you pay vat according to how far offshore the boat is able to go. Their boat rating system runs from somethingh like "within 5 miles of a harbour" (o%vat relief) to 200miles + from a harbour (50% vat relief). Now, remember that only a french person or company can have a french-reg boat. So a french leasing compnay is needed to nip in, who rents it to you and flogs at the last payment. They know they are only liable for 50% of the 19.6% vat. So with cheapy euroland money they can work inside this 19.6 and 9.8% vat rate, and you pay (say) 98% of the vat-inclusive price. Of course, the savings all go down the toilet if the euro runs against you ...

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[tcm]

relax- the vat on 25k is not worth sweating over.

Or is it? I wd re-register the boat in the turks and cacos, inject money into said compnay from a uk company, then set up an isle of man company to charter the boat full-time back to a UK company and then you assign yourself only the used portion of this against your personal tax -almost nothing. Within 9 years flatten the turks and cacos compnay without producing accounts, perfectly legal, and hence a free boat arises assigned to you paid for with tax-free money. I reckon it might save um well half the vat and 40% tax on the purchase price. But of course if you went anywhere abroad the rozzers (les rozzeurs) are down on you like a tonne of bricks. Hint: you don't need to carry any spare bricks.

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[EME]

Well I wouldn't have had a quote for one of those ( £250k+ ) would I !!!

Didn't like some of the early settlement terms, nor interest rate adjustment calculations either but have to take everyone's word that it starts cutting it at 250K. They didn't explain that to me.



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[DepSol]

Whats VAT? /forums/images/icons/smile.gif

<hr width=100% size=1>Dom

<A target="_blank" HREF=http://www.soltron.co.uk>the website</A>

 

[Deleted User YDKXO]

Re: france, in excess of £250k

When I was looking at boats to buy in SoF, I was offered several boats which were being leased to their French owners but nobody could explain to me exactly how a UK resident like myself could actually buy the boat. Presumably title is owned by the leasing company not the 'owner' of the boat. Any idea how this works?

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