Proof of VAT

[Dek]

Yes the hot potato again.
I'm off to butter melting countries next year and I thought I was OK, now I'm hearing horror stories.

My boat was built in 1966, bought by me in 1997 and is Part 1 registered.
I understood that I do not need to prove any vat payments. Now somebody tells me that I have to prove it was in UK waters in 1992, this seems next to impossible.
Is this info correct?

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[boatmike]

I have not heard that one before but for definitive advice on the subject suggest you contact customs and exise direct. I did recently and found them very helpful.

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[AndrewB]

Sorry Dek, this question's been done too often. The official guidance is <A target="_blank" HREF=http://ww2.hmce.gov.uk/forms/notices/8.htm>HERE</A>. Do a search on this forum for experiences as to how this works out in practice. Your problem is in the EU, including the UK, not in butter-melting countries. It may not be serious, but definitely an irritant. There is a reason why old yachts that can't prove their VAT status are cheaper than those that can.

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[roam]

we happened to be passing the HMC stand at the boat show who offered a key ring to us as we were passing by. well that got me started!!!
they offer absolutely NO assistance in providing documentation or anything that will prove you are VAT exempt when you cruise or return to the UK. THEN of course they will want proof - which you can't give them because they couldn't tell you how you should have done it in the first place.

its a complete con.

i don't think the poor lady quite knew what hit her!

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[AndrewB]

Are HMCE really the villains?

To be honest, I'm not sure they can be blamed. When the VAT rules changed in 1992, they opened the Dover Yacht Unit to deal with the problem of older yachts lacking VAT proof. With considerable publicity throughout the yachting press, for 18 months they issued the EU Single Administrative Document for yachts, and after that scheme finished for another two years they provided letters of exemption to applicants offering sufficient evidence. All owners of yachts without VAT proof should have applied in this period.

I can well understand that they did not want to run a free transitional service indefinitely, and may have lost patience with those who ignored it. They still do not penalise yachts which failed to take advantage of these facilities, but have made clear in Note 8 the conditions under which officers will, de facto, accept the VAT status of such yachts.

The problem though is with other EU countries, and particularly Spain, Portugal and Greece, which are the most likely destinations of VAT unpaid yachts being smuggled into EU. There, without reasonable VAT documentation, risk of suspicion could well arise.

Surely there has been sufficient publicity over the years, reproduced for example in RYA guidance and routine brokerage advice, that people will be wary of buying a yacht without evidence of its VAT status? After all, most large purchases these days involve paperwork. It seems a bit like buying a car innocent of the fact it would need Road Tax.

 

[Pat1]

The following may be of help
Proof of VAT Paid
When visiting EU countries, if your boat was built after January 1985 you must
be able to prove that VAT has been paid. If you can't, then you may be
required to pay VAT at that country's rate ­ not a pleasant thought. Valid
proof is a VAT receipt backed up by a builder's certificate. If the boat is
second-hand, you should also show the bill of sale. Customs may also ask for
VAT receipts for expensive items added later, eg radar, chart-plotter etc. If
your boat was built before 1985 it's exempt from VAT, but you'll need to have
evidence to prove it, for example a builder's certificate.
I believe this is from the RYA.

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