sailaboutvic
Well-Known Member
The RCD could easily go too if they want to trade with places like the US
HMRC U-turn on tax on returning boats
- Thread starter goeasy123
- Start date
Chris_Robb
Well-Known Member
Vic, if you are a UK resident, (of any nationality) you cannot use Temporary Admission (TA). If you are not - ie resident in the EU27 you can use it - it is quite an informal procedure where you just keep contemporaneous evidence of when you came or left. In the UK you fill in a C1331 - which we will all have to do in future returning from abroad. I think the forms may change as the wording now in inappropriate.No suggestion of smuggling boats back intô the uk for the sake of the internet police man .
But if it become law that a boat return back to the UK is libel for VAT a second time ,
Going back what the non paid vat rules are now ,
what stop you taken a boat back to the UK and leaving within 18 month return back to the EU where it is vat paid for a few days then return back for another 18 month or is that going to change too ,
Are non vat boats not going to be able to cruise the UK?
Are they really going to stop the Dutch French German boats from cruising the UK.
All legal ways around this and no smuggling involved .
But has I posted it all meanless at the moment .
sailaboutvic
Well-Known Member
Agree Chris but most people posting here have residency in an EU country .
sailaboutvic
Well-Known Member
It's all irrelevant any way very few of us will be bring boats back , there be worth more in the EU .
Chris_Robb
Well-Known Member
True - but its not all about Med sailing. There are many of our members sailing around the world who are returning to the UK having had no time in the EU (so no EU Vat). At the moment the way HMRC are talking they will have to pay VAT all over again.
Actually the wording of RGR gives a huge get out to a returnee provided he is now a resident of the UK - and it is this that has been used for years and is standard practice and is in HMRC's advice to customs agents. The RYA announcement was that they would now interpret 3 years export to the letter - but the law allows for later returns...... So unless they are stopping this, I really am not sure that this is not a fuss about nothing - anyway we will find out shortly when the CA speaks directly to the HMRC and not through the RYA as we were on this, who may have been asleep on the job, and may have misunderstood the HMRC announcement completely.
Lets hope I am right!!!!
Kelpie
Well-Known Member
Excuse my ignorance, but does any of this VAT stuff apply to older boats?
Kelpie
Well-Known Member
Excuse my ignorance, but does any of this VAT stuff apply to older boats?
sailaboutvic
Well-Known Member
True it is them who will lose out and let's hope you are right , it's one of most unfair U turn this government or should I say HMRC have made .
For them in Europe I really don't see a problem forget all the my crap talk after a few drinks about sailing the boats back into the UK under the radar
, there really no contest for them in the Europe , if it's a choice of paying VAT again at the same time losing VAT status in the EU only having the UK market when it comes to selling as no European person will want a non VAT boat to sail in Europe unless it bein given away ,
Or keeping it in the EU and selling it there it clear what most will do , not only there will have a bigger market and better prices but there have 20% to play with when it comes to negotiations a price .
Seven Spades
Well-Known Member
First of all I have some bad news for you all. I took part in a trial of the new e-borders computer system the government is developing, it will track everyone in an out of the UK so there will be no getting away from the time away. It is not going to be in place for 1st January so my guess is if you boat is in the EU and has been for some time and you return to the UK when you phone the "Yachtline" to report your return to the UK you won't be asked when the boat left the UK and even then they will really have no way of knowing the truth.
The real problem is for circumnavigators who will take a very expensive blue-water yacht around the world and return after 4-5 years, it is wholly unreasonable to determine that it was permanently exported and liable for VAT again. If you look at an post #38 there are exception to the 3 year rule and that is for "professional and personal effects returning with returning UK or EU expatriates". So you would need to have HMRC agree that whilst you were circumnavigating you have acquired "expat" status and therefore your returning boat is in fact eligible for relief.
There is in fact no change in the law just the suggestion that enforcement will be more rigorous and that has to be because of the e-borders system.
The real problem is for circumnavigators who will take a very expensive blue-water yacht around the world and return after 4-5 years, it is wholly unreasonable to determine that it was permanently exported and liable for VAT again. If you look at an post #38 there are exception to the 3 year rule and that is for "professional and personal effects returning with returning UK or EU expatriates". So you would need to have HMRC agree that whilst you were circumnavigating you have acquired "expat" status and therefore your returning boat is in fact eligible for relief.
There is in fact no change in the law just the suggestion that enforcement will be more rigorous and that has to be because of the e-borders system.
Graham376
Well-Known Member
Problem there is that many circumnavigators are still tax resident in the UK as that's their home base so, hard to claim expat status. Same applies to many of us with dual residence in EU and UK.
Seven Spades
Well-Known Member
Work out your residence status
Whether you’re UK resident usually depends on how many days you spend in the UK in the tax year (6 April to 5 April the following year).
You’re automatically resident if either:
Whether you’re UK resident usually depends on how many days you spend in the UK in the tax year (6 April to 5 April the following year).
You’re automatically resident if either:
- you spent 183 or more days in the UK in the tax year
- your only home was in the UK - you must have owned, rented or lived in it for at least 91 days in total - and you spent at least 30 days there in the tax year
- you spent fewer than 16 days in the UK (or 46 days if you have not been classed as UK resident for the 3 previous tax years)
- you work abroad full-time (averaging at least 35 hours a week) and spent fewer than 91 days in the UK, of which no more than 30 were spent working
Seven Spades
Well-Known Member
It looks like no return visits to the UK in the last year of a circumnavigation are allowed.
goeasy123
Well-Known Member
Quite apart from our interests as boat owners someone should state the blindingly obvious to HMRC.
While the impact of this u-turn might yield a very small tax take from private owners the impact on the marine industry and employment will be significant. The benefits to the Treasury with be far outweighed by the downside.
The CA, RYA and BM should coordinate the evidence and tell HMRC that if they now chose to implement the rules the UK marine industry will shrink, private owners will move out or not return and tax take will fall. The new and used boat market will abandon the UK. On the other hand if they chose to abolish the rule altogether the UK marine industry will be advantaged amongst its European rivals with an increase in business, employment and coincidently increased tax take (from the sale of new and second hand boats, services and related product sales).
My letter to my MP will include an expression of concern that HMRC's decision will reduce valuable foreign earnings, tax revenue and damage employment prospects in return of a paltry return from the small number of private owners that might now return their boats to the UK.
Am I making sense?
While the impact of this u-turn might yield a very small tax take from private owners the impact on the marine industry and employment will be significant. The benefits to the Treasury with be far outweighed by the downside.
The CA, RYA and BM should coordinate the evidence and tell HMRC that if they now chose to implement the rules the UK marine industry will shrink, private owners will move out or not return and tax take will fall. The new and used boat market will abandon the UK. On the other hand if they chose to abolish the rule altogether the UK marine industry will be advantaged amongst its European rivals with an increase in business, employment and coincidently increased tax take (from the sale of new and second hand boats, services and related product sales).
My letter to my MP will include an expression of concern that HMRC's decision will reduce valuable foreign earnings, tax revenue and damage employment prospects in return of a paltry return from the small number of private owners that might now return their boats to the UK.
Am I making sense?
sailaboutvic
Well-Known Member
Its very clear from people I spoke to since this came to light that non have any intention to take there boat back to the UK if this happen .
goeasy123
Well-Known Member
I'm cruising the Algarve at the moment and people here are saying the same.
The CA and RYA should survey their members to provide HMRC with hard evidence.
goeasy123
Well-Known Member
I was planning to return to Lymington in 2022 for a refit. That's not going to happen now!!... Dutch yard now.
Chris_Robb
Well-Known Member
Graham.. this ToR clause is used when any yacht come in on the deck of a ship. The customs broker asks you to fill in a form 3 main question, are you the origin owner? Has the vessel had major work done .
Have you reclaimed VAT on leaving the EU.
This is the form that we will now have to fill in, ie they will enforce the law. But so simple, 5 minutes of your time.
Why has the RYA adopted scare tackticks, is it that they have no idea or perhaps been asleep on watch, both I think.
In short, 3 years is your automatic exemption from export, any UK resident may claim ToR. It is only refused when intelligence tells customs that something is not right.
There are a couple issues we are chasing down, but in general most of us will have our cake and eat it.
Chris_Robb
Well-Known Member
There has been no U Turn - just saying that we all now need to fill in a form, which formally was only done when yachts came back on the deck of a ship.
The form you fill in - a declaration - makes no mention of where you have been in the last year, so I dont think this will be a factor
I would not send a letter yet to your MP, wait a short time, it will all become apparent this was a storm in a teacup and we are in danger of crying wolf to our MPs!
Graham376
Well-Known Member
I think you're right, most of us already in EU won't want to bring boats back to the UK anyway. When eventually sold they will be attractive to those who in future want to be Med/EU based.
st599
Well-Known Member
The u turn is on timing, not applying the rules.
HMRC originally told RYA it would be applied 3 years from the end of December 2021, but now say 3 years from date of export. Which means many now have 3 months, during the worst part of the year, to arrange getting their boats back.