MBM and VAT advice

[gjgm]

I might be missing yr point but I dont think the vagueness and imprecision is in the tax code so much as in the material put out by brokers, RYA et al.

Anyone heard of cases of smuggled boats and VAT charges being slapped on innocent buyers, along these lines?
Hey, how about a case, at all, would be a start.

 

[Observer]

Semantics, but it does depend on the way you read "original". In most of the advice it is used to differentiate from "copy", rather than to indicate the "first" VAT invoice issued. In the section about documentation (in the RYA/HMRC FAQs) it also refers to there being a possibility of more than one VAT invoice relating to the same boat. This is, however, by implication rather than a clear statement and there is insufficient further explanation as to why this might be so, leading to the ambiguity.

I meant "original" in the sense of the first invoice issued immediately before the boat is first brought into use as NMT. An "original" in the sense of 'not a photocopy' is nice to have but not critical, IMO. As remarked an "original" (not a copy) has little meaning in the days of PDFs, colour laser printers etc. but should be seen in context of other documents that give circumstantial support.

I frequently receive original VAT invoices (in business capacity) as word/excel files that I could, if minded, alter at will.

 

[Elessar]

The whole VAT idea is getting more like a farce..........

So its only really the worry warts that are interested in the original VAT receipts but........

YBWFORUM LTD buy a £1m boat for 'charter' pay £200k VAT to Sunseeker and then claim £200 k back from HMR&C.

They then sell the boat to 'shrewdforummember' who demands the original VAT invoice and asks YBWFORUM LTD to sail the boat from Poole to CI , (as he says he intends to stay there) do the deal in Jersey (outside VAT) and no second 20% VAT is paid.
'Shrewdforummember' then sails back to Poole, all the locals recognise the boat, no questions asked, several years latter shrewdforummember sells the boat as VAT paid.

The Boat has an original VAT receipt, everyone is happy.

Put this scenario with all the secondhand VAT paid boats in CI and Croatia which have now lost their VAT paid status ( treated as exported after 3 years) and the whole concept of a tatty old VAT receipt being worth anything at all and its a joke.

Now I realize both my examples are not common however the worry warts are demanding absolute certainty but dont get 100% certainty with the VAT receipt.



I must have this wrong, surely

if you want to have illegal documents there is an easier way.

Copy the receipt you get from HMRC on import from another boat. It's just plain text so easy to do.They keep no records so job done.

 

[Tranona]

I might be missing yr point but I dont think the vagueness and imprecision is in the tax code so much as in the material put out by brokers, RYA et al.

Which in this case is provided by HMRC - not by the other organisations.

That is the point I was making. Most of this debate never gets anywhere near the law as written - opinions are formed by public explanations and HMRC is always a vague as it can get away with, knowing that it is unlikely to be challenged.

Maybe its time for an FOI question requiring disclosure of all the cases of VAT offences committed in relation to pleasure craft. Cynical me expects a similar answer to the one given when the Borders Agency were asked for details of actions taken as a result of boarding yachts.

 

[Tranona]

I meant "original" in the sense of the first invoice issued immediately before the boat is first brought into use as NMT. An "original" in the sense of 'not a photocopy' is nice to have but not critical, IMO.

I know what you meant, but I was observing that the "official" advice from HMRC in the RYA FAQs sheet does not make this clear. Unsurprising as lack of clarity seems to be their style in giving advice.

 

[jfm]

if you want to have illegal documents there is an easier way.

Copy the receipt you get from HMRC on import from another boat. It's just plain text so easy to do.They keep no records so job done.

Not so sure about that Ellesar. Daka's Shrewdforum member is guilty "only" of smuggling and not of having any "illegal document". Your method adds fraud, cheating the public revenue, and creating a false instrument to the charge sheet! I suppose if you're going to the clink anyway it might not make much difference...

 

[jfm]

Which in this case is provided by HMRC - not by the other organisations.

Yeah but are you saying that's an excuse? So HMRC issue some fuzzy "advice" and then the RYA repeats it. The fact HMRC say something most certainly doesn't mean it's correct. Call me olde fashioned, but whatever happened to reading and studying the law, as proper lawyers do, and as RYA legal should do?

 

[Observer]

I know what you meant...

Sorry. Yes I can see you did. Anyway it was worth clarifying/repeating to avoid doubt.

 

[Deleted User YDKXO]

I frequently receive original VAT invoices (in business capacity) as word/excel files that I could, if minded, alter at will.

Exactly and not forgetting that in most businesses paper copies of sales invoices don't exist as accounts are invariably computerised. Copies of sales invoices only exist in computer records and could be altered if the seller so wished

 

[MapisM]

Well, that was exactly my point, in the second paragraph of above post.
The only way to reasonably grant that a doc is genuine and was issued by whoever was supposed to issue it, is through certified emails/attachments.
Even the good old paper invoices could be altered, after all...

 

[Deleted User YDKXO]

Well, that was exactly my point, in the second paragraph of above post.
The only way to reasonably grant that a doc is genuine and was issued by whoever was supposed to issue it, is through certified emails/attachments.
Even the good old paper invoices could be altered, after all...

Sorry Mapism, I missed that. Its been one of those interminable threads

 

[jfm]

Oops, sorry Mandy

Oops, dang, I owe Mandy Peters at rya an apology. I made a mistake above when I said Mandy had written that article in MBM Feb2012 edition with the incorrect VAT analysis. It was in fact written (I've just noticed) by Nick Burnham who (I think) is a yacht broker and writer/boat tester for MBM. Mandy wrote another article on the same page about a different topic and that must be how I made the mix up, but it was my mistake so I apologise to Mandy.

I tried to log into RYA website today to read what Mandy has written about VAT (they have a new FAQ doc) but I don't know my RYA membership number so couldn't log in!

 

[Tranona]

Yeah but are you saying that's an excuse? So HMRC issue some fuzzy "advice" and then the RYA repeats it. The fact HMRC say something most certainly doesn't mean it's correct. Call me olde fashioned, but whatever happened to reading and studying the law, as proper lawyers do, and as RYA legal should do?

Not excusing them but it would be a pretty brave person to add in a joint public document that information provided by HMRC is a load of old cobblers. Equally the other organisations and the banks are not likely to challenge HMRC in the abstract as there is nothing in it for them.