Guernsey to UK vat issues

[Paul_S123]

I have a non vat paid boat in Guernsey...it's ultimate destination is the med, where I will do an 18 month temporary importation...and maintain it's non vat paid status. One option I was looking at (due to covid travel restrictions) was to get it sailed to the UK...provisioned and then have a crew take it to the med. I am UK based...so my research has led me to the fact that if it comes (even very temporarily) to UK, I will have to pay VAT on it...even though it's just a stop on a trip down to the med.

Any thoughts, workarounds or suggestions.

 

[JNKScot]

I have a non vat paid boat in Guernsey...it's ultimate destination is the med, where I will do an 18 month temporary importation...and maintain it's non vat paid status. One option I was looking at (due to covid travel restrictions) was to get it sailed to the UK...provisioned and then have a crew take it to the med. I am UK based...so my research has led me to the fact that if it comes (even very temporarily) to UK, I will have to pay VAT on it...even though it's just a stop on a trip down to the med.

Any thoughts, workarounds or suggestions.

Probably cheaper and easier to get the crew to Guernsey by sea or air and victual the boat there VAT free.

 

[Tranona]

You are correct, but you can take it to France without any problems VAT wise as you are non resident, although of course Covid restrictions may apply.

 

[Ningaloo]

If HMRC deem you to be tax resident (regardless of how much time you spend in UK annually or where you actually live) then my understanding is that you are liable for VAT on entering UK waters.

 

[Daydream believer]

Pity the solent is not a freeport yet. With a commercial crew doing the trips in & out one could , presumably treat as a commercial goods shipment & avoid the hassle of VAT. Or is that not how freeports are supposed to work?

 

[Tranona]

If HMRC deem you to be tax resident (regardless of how much time you spend in UK annually or where you actually live) then my understanding is that you are liable for VAT on entering UK waters.

Nothing to do with tax residence of the importer. All boats imported for use in the UK are liable to VAT unless they qualify for one of the reliefs. The relief the OP would like to use is Temporary Importation , the key requirement being that it is registered outside the UK in the name of a person established outside the UK and used by a non UK resident (with some limited exceptions).

The owner says he is UK based so does not qualify for this relief.

 

[TernVI]

Nothing to do with tax residence of the importer. All boats imported for use in the UK are liable to VAT unless they qualify for one of the reliefs. The relief the OP would like to use is Temporary Importation , the key requirement being that it is registered outside the UK in the name of a person established outside the UK and used by a non UK resident (with some limited exceptions).

The owner says he is UK based so does not qualify for this relief.

So, in short, it is everything to do with the user being tax resident in the UK?

 

[Tranona]

So, in short, it is everything to do with the user being tax resident in the UK?

No. it starts with the boat. The rules say nothing about tax residence of the owner, The actual words are "registered outside the UK in the name of a person established outside the UK" or if not registered "someone who has their normal place of residence outside the UK". Of course where you pay tax may influence where you are established - but when that term is used for eligibility for the SSR it says nothing about tax!

Not directly relevant to this query, but there are now, following Brexit many people who have normal residence in EU states but also pay tax in the UK - and own boats that are not UK VAT paid. If they registered their boat in their state of normal residence on the face of it they would qualify for TI into the UK.

I have no doubt that when boat movements start again this rather woolly rule will be tested.