Proof of VAT

[absit_omen]

I am the second owner of a steel yacht, launched in 1997, which was custom yard built to the specification of the original owner.

The boat was advertised by the broker as 'Tax Paid'.

The original owner left original VAT Invoices of every stage payment to the builders along with other invoices covering additional equipment fitted over the course of several years. The total expenditure amounts to over 400k stg. All of the purchases appear to have been made by the individual, not a VAT Registered Company so I am assuming none of the VAT paid has been claimed back.

However, there is no single stand alone document or certificate which states that VAT has been paid. If I am challenged by, say, Portuguese Tax people, are they going to accept this mountain of paperwork as evidence of VAT paid or must I seek some sort of UK VAT Office document? If so, how??

Cant see UK VAT Office being too sympathetic and the broker (if I can be bothered to ask him) is likely to come up with caveat emptor! Oh yes, and both yards involved in the build have gone out of business - natch!

Any informed comments much appreciated.

 

[BrendanS]

If self built and you have a mountain of VAT documentation, then you are pretty much covered.

The chances of UK customs giving you a document to cover you are remote. However, as UK registered boat abroad, the VAT issue is one for the UK to deal with, not foreign bodies.

If you are really concerned, get a UK based international solicitor to put together a document in all the languages you are likely to cruise in, which states it is self built, and the VAT rules under your home country (UK) are covered. Will cost you a few quid, and you'll need to find a decent international solicitor who speaks (and writes) several languages, but they are about. Not a 'taxing' document for them to put together (sorry, bad tax pun)

 

[Joe_Cole]

I can't really help but your posting does conjure up a picture of you sat down below surrounded by very bored looking Customs officers.
You with a pile of invoices.... "and this is for the winches, this is for the furling gear, this is for the radio, this is for the paint, the undercoat, 6x 8mm bolts......zzzzzzzzzzzzz"

 

[absit_omen]

Joe, that is exactly what it would be like! Except that I always send SHMBO on these missions as she has a much longer fuse than I!!!

Thanks, Brendan. I shall put my tame accountant on the case.

 

[capsco]

I think the thing to do is to keep a file with you that shows the major items only ie engine/g/box/stern gear and hull superstructure materiels.

 

[dansar]

Hi

Have just read your VAT "problem". /forums/images/graemlins/shocked.gif

If you are a uk flagged vessel, or have an address in the uk, it might be worth having a chat with a contact I've made at the VAT office. He helped me out recently, although I had to pay the VAT on our purchase. We now have a VAT paid status and certificate for our yacht which could save a lot of problems and time in the future!!!!

You appear to have all the invoices etc so I'm sure he will be able to help you one way or another.

If you would like a contact phone number then please PM me

Regards

David

 

[bobgosling]

BrenndanS [ QUOTE ]
as UK registered boat abroad, the VAT issue is one for the UK to deal with, not foreign bodies.


[/ QUOTE ]

Unfortunately the French ( Gawd bless 'em ) have a derogation which states that THEY are the responsible authority for deciding the VAT status of vessels in their waters.

One point which I have often pondered is; how exactly can anyone ever check the validity of a document purporting to show evidence of VAT payment ? Do Customs officers note the VAT reg number and look it up on a database ? Even then, the actual payment is not recorded anywhere. What if someone forged a document using a valid VAT reg number ? And even if VAT has been paid how can you ever prove that it was not refunded at some point ? And what about boats that have been renamed and now differ from the name on the VAT invoice ?


The whole thing is a mess ! The RYA really ought to be doing something about this. I have written to them about it - could you all do so too ? I guess that the bottom line is that unless we have compulsory registration of boats and have VAT and Debt data stored with the registration this problem will remain.

 

[Sea Devil]

Although it is possible for other European counties to challenge the VAT status of EU boats in their waters I get the impression these regulations are intended to 'catch' non EU boats being imported without the tax being paid or the fairly uncommon practice of people buying 'tax free' boats to be exported outside EU waters then in fact being taken into another EU country.....

I do not think there is much likelihood of 'foreign' EU customs asking for more evidence than would satisfy UK customs - If the boat is clearly a UK boat - with a UK history then they will not bother.

If it is American, West Indian, South African, Australian et al then they will possibly be very very interested.... Whilst it is nice to try to tie up all the loose ends when making the expensive purchase of a boat in reality it is frequently almost impossible - how can you prove a negative - that VAT has never been reclaimed - almost impossible but the reality is that anyone selling an expensive business asset would have to put it through their books and accordingly repay the VAT so the chances of a a VAT reclaimed boat reaching another buyer without the VAT being repaid are tiny if the paperwork and registration of the boat is in a private name.....

I think........

 

[absit_omen]

Thanks everybody. What sparked this was reading the Gibraltar Yacht Scene Handbook (5 quid) which is similar to the Straits Sailing Handbook and states:

'Yachts entering Portuguese ports and belonging to EU nationals must produce a valid VAT certificate - if not, they will be required to pay VAT at 16%'

Normally I would have taken this with a pinch of salt but I have also heard tales of complicated Portuguese bureaucracy. However, I think I shall just match bulls**t with bulls**t

Digressing slightly, the handbook also details very complex Spanish regulations on keeping a boat there. I know that these are just not enforced at the moment. However, with berths becoming increasingly hard to find, (as anyone who has cruised from Gib to Barcelona and the Baleares will confirm) I believe that - in a move to return the berths to the Spanish - many of these embuggerances will be applied.

A nice one is the process of PREINTADO where, if you leave the boat for more than two months you must inform customs in writing with the name of the person who will have custody of the boat. The boat will then be sealed and a sign affixed declaring the vessel 'precintado'. There is then a complicated process for lifting the precintado. Naturally, all this aint for free!!

OK, it is not happening now but it is just one nasty up the sleeve.