Sailing to France - VAT and competence documents

[slawosz]

Hi,
its very likely I will sail to France this year. Two things that I dont understand from Paperwork | boating abroad | RYA are:
- vat documents - I understand that it is required by UK authorities. My boat was produced around 1980, I just have normal buy/sell paperwork. Do I need anything else?
- certificate of competence - I have none. In theory, French authorities are asking one for inland waters only, did anyone heard about problems with authorities when there is lack of one?

 

[Spirit (of Glenans)]

Hi,
its very likely I will sail to France this year. Two things that I dont understand from Paperwork | boating abroad | RYA are:
- vat documents - I understand that it is required by UK authorities. My boat was produced around 1980, I just have normal buy/sell paperwork. Do I need anything else?
- certificate of competence - I have none. In theory, French authorities are asking one for inland waters only, did anyone heard about problems with authorities when there is lack of one?

Regarding certificates of competence; for seagoing use, the French authorities do not demand that skippers of British boats hold any, as they are not required to, in their home country
Regarding VAT; your term "buy/sell paperwork" is a little vague. Do you have the Bill of Sale that the original owner received when he bought the boat, the entire papertrail of successive ownerships, or just the Bill of Sale that you received when you bought it?
The original owner's documentation would show whether or not VAT was paid, but transfers of ownership through private sales subsequently would not have accrued any taxa and none would be shown on the Bills of Sale. There may well be some regulation exempting from having to prove VAT payment, boats built before a certain date and being kept in the EU throughout, but someone more knowledgable than I will undoubtedly come along shortly with some information relevant to that.

 

[Tranona]

Hi,
its very likely I will sail to France this year. Two things that I dont understand from Paperwork | boating abroad | RYA are:
- vat documents - I understand that it is required by UK authorities. My boat was produced around 1980, I just have normal buy/sell paperwork. Do I need anything else?
- certificate of competence - I have none. In theory, French authorities are asking one for inland waters only, did anyone heard about problems with authorities when there is lack of one?

Nothing to worry about. Your boat is what is known as "deemed VAT paid" on account of its age. Evidence you bought it in the YK and it is till based here is more than enough - but you will be highly unlikely to be asked - they have far more important things to do. No evidence of competence required, but do make sure you register your boat on the SSR as the French are particularly hot on this.

 

[Sandy]

I have written to my MP three times about this as he does not appear to understand the question as all I get back are the regulations, which I pointed him at in the first place.

My conclusion is that nobody is willing to explain what is needed and if ever dragged through the course will be giving my emails as evidence.

 

[Tranona]

I have written to my MP three times about this as he does not appear to understand the question as all I get back are the regulations, which I pointed him at in the first place.

My conclusion is that nobody is willing to explain what is needed and if ever dragged through the course will be giving my emails as evidence.

This really is a non issue. There is no definitive "proof" that VAT has been paid on a specific boat nor is there any legal requirement to have such proof. all HMRC require when entering the UK is evidence that you are not importing a boat such that a chargeable event may arise. There are many ways of showing this, the most common is as I suggested above. Obviously having the original invoice is also evidence, but as there is no legal requirement to keep this the vast majority of boats in the UK do not have this documentary evidence.

This ambiguity has been with us for over 30 years now and it really does not cause any problems. The only thing that has changed is UK now being a separate VAT area more boats will require checking as they enter UK waters but for UK based boaters this is not a problem.

The reason your MP cannot give you an answer is because of what I explained in the first paragraph - there is no answer to give, nor any point in constantly asking the question and complaining that you can't get an answer.

 

[Koeketiene]

I was boarded by French Customs (Douanes) the week before last.
Mine is one of the few foreign registed boats at my home port, so I get them round most years.

This is what I have learned over the years:

1. As long as your boat is registered in your own name, you have very little to worry about when it comes to VAT. Boats owned by a company - especially recent boats - are much more likely to be of interest.
2. As long as you don't sail inland waters, no-one will ask you for qualifications unless you sail a French registered boat. Should you venture inland, whatever qualification you hold would need to be CEVNI endorsed.

 

[LadyInBed]

2. As long as you don't sail inland waters, no-one will ask you for qualifications unless you sail a French registered boat. Should you venture inland, whatever qualification you hold would need to be CEVNI endorsed

Endorsed CEVNI is only required on VNF controlled waterways. You can go up the Rance to Dinan and the Vilaine to Rennes without CEVNI as they are not a VNF controlled waterways. Also, up the Seine to Rouen as it is a Seaway. Rouen on to Paris is VNF controlled.

 

[Sandy]

This really is a non issue. There is no definitive "proof" that VAT has been paid on a specific boat nor is there any legal requirement to have such proof. all HMRC require when entering the UK is evidence that you are not importing a boat such that a chargeable event may arise. There are many ways of showing this, the most common is as I suggested above. Obviously having the original invoice is also evidence, but as there is no legal requirement to keep this the vast majority of boats in the UK do not have this documentary evidence.

This ambiguity has been with us for over 30 years now and it really does not cause any problems. The only thing that has changed is UK now being a separate VAT area more boats will require checking as they enter UK waters but for UK based boaters this is not a problem.

The reason your MP cannot give you an answer is because of what I explained in the first paragraph - there is no answer to give, nor any point in constantly asking the question and complaining that you can't get an answer.

If it is a 'non-issue' why does the government not simply say it is a non issue?

 

[Tranona]

If it is a 'non-issue' why does the government not simply say it is a non issue?

Because sometimes it is an issue if you are importing a boat, but that does not apply to UK based boats leaving and returning to the UK. By definition they are VAT paid under the terms of the withdrawal agreement. If government wanted you to have written proof they would introduce a mechanism to do that as they tried to do post 1992 but gave up because VAT is not a tax on the boat and the tax paid status of the boat can change over time. This is a complicated legal issue that arises from the merging of our then 20 year old VAT system with the single market one which uses VAT payment as the means of determining whether goods are EU goods and have free circulation. Fine for new entrants to the EU who have mechanisms for registering this proof, as well as for most existing members who also had registration of VAT payment systems.

The UK system predates all of this and was never intended to be more than what it claims - a tax on transactions with the responsible for ensuring it is correctly applied and paid resting with the VAT registered seller NOT with the buyer - neither the original nor any subsequent owner. The VAT directive does not require any form of registration of payment and collection of the tax is a state competence and the UK system met the requirements of the directive so government decided not to change it. The free circulation element was dealt with by making the individual state responsible - so UK boats could enjoy free circulation on the basis that any VAT issues were the responsibility of HMRC. This was the advice given to UK owners taking the boat into the EU and by and large worked very successfully for 28 years.

Of course this is all in the past as since 2021 UK boats do not have free circulation in the EU so VAT payment for boats in the UK on 31/12/20 are, under the terms of the withdrawal agreement UK VAT paid as are any boats bought in the UK (or imported from outside) since then. Hence the advice I gave earlier.

You did ask.

 

[Tranona]

:

1. As long as your boat is registered in your own name, you have very little to worry about when it comes to VAT. Boats owned by a company - especially recent boats - are much more likely to be of interest.

This is irrelevant for UK boats now. EU customs are not interested in VAT payment of third country boats unless you want to import it into the EU. Third country boats enter without VAT payment under the TA rules.

 

[KAM]

Also thinking about a trip to France. My boat is on the UK SSR. The UK passport office made such an arse of my recent attempt at passport renewal that I decided not to bother and just got an Irish one instead. I'm resident in Scotland. Are there likely to be any problems with an Irish passport holder sailing a uk registered boat. Shall I fly a tricolour, saltire or red ensign or all three. Last time I went it was a saltire the only comment I got was from a warship passing in Plymouth when I distinctly heard over their tannoy what the #£!!#k is that ensign.

 

[KompetentKrew]

I have written to my MP three times about this as he does not appear to understand the question as all I get back are the regulations, which I pointed him at in the first place.

My conclusion is that nobody is willing to explain what is needed and if ever dragged through the course will be giving my emails as evidence.

Replies are being sent by one of his researchers / assistants - I believe they often provide copy-paste answers.

Visit his surgery so you can concisely explain the problem. to the man himself.

I bought my boat in Holland and the previous owner obtained this VAT-paid certificate for me. If you print it out you could show it to your MP and translate by hovering over it with your phone (Google Translate app - press "camera" at the bottom of the screen).

 

[Tranona]

Replies are being sent by one of his researchers / assistants - I believe they often provide copy-paste answers.

Visit his surgery so you can concisely explain the problem. to the man himself.

I bought my boat in Holland and the previous owner obtained this VAT-paid certificate for me. If you print it out you could show it to your MP and translate by hovering over it with your phone (Google Translate app - press "camera" at the bottom of the screen).

That is a mechanism chosen by the Dutch government to satisfy the "EU goods" requirement. It was considered (and tried) by the UK govt, but ultimately discarded because legally it is suspect for the reasons explained in post#9. While it makes a statement based on the evidence presented at the time, things can change by something as simple as the boat being out of the EU for 3 years when it loses its EU VAT paid status and no longer has freedom of circulation without paying VAT again.

To understand the legal argument you have to get your head around the difference between an asset tax and a transaction tax.

 

[Tranona]

Also thinking about a trip to France. My boat is on the UK SSR. The UK passport office made such an arse of my recent attempt at passport renewal that I decided not to bother and just got an Irish one instead. I'm resident in Scotland. Are there likely to be any problems with an Irish passport holder sailing a uk registered boat. Shall I fly a tricolour, saltire or red ensign or all three. Last time I went it was a saltire the only comment I got was from a warship passing in Plymouth when I distinctly heard over their tannoy what the #£!!#k is that ensign.

You have to use the ensign of the state of registration of the boat to comply with international maritime law. your citizenship/residence etc is irrelevant.

 

[Spirit (of Glenans)]

This really is a non issue. There is no definitive "proof" that VAT has been paid on a specific boat nor is there any legal requirement to have such proof. all HMRC require when entering the UK is evidence that you are not importing a boat such that a chargeable event may arise. There are many ways of showing this, the most common is as I suggested above. Obviously having the original invoice is also evidence, but as there is no legal requirement to keep this the vast majority of boats in the UK do not have this documentary evidence.

This ambiguity has been with us for over 30 years now and it really does not cause any problems. The only thing that has changed is UK now being a separate VAT area more boats will require checking as they enter UK waters but for UK based boaters this is not a problem.

The reason your MP cannot give you an answer is because of what I explained in the first paragraph - there is no answer to give, nor any point in constantly asking the question and complaining that you can't get an answer.

The OP wants to go to France.

 

[MADRIGAL]

You have to use the ensign of the state of registration of the boat to comply with international maritime law. your citizenship/residence etc is irrelevant.

Red Ensign. Or Blue or White, if entitled. Red likely to raise fewest questions, I would think.

 

[Sandy]

You did ask.

I did.

My background is engineering, safety engineering in particular. When a problem was presented it was researched and a statement made.

A simple statement from HMRC, e.g. no privately owned boat needs to prove its VAT status, would solve lots of boat owners wandering what in earth does the wordy regulations mean to me.

 

[Koeketiene]

A simple statement from HMRC, e.g. no privately owned boat needs to prove its VAT status, would solve lots of boat owners wandering what in earth does the wordy regulations mean to me.

In all fairness, you can't really expect HMRC to issue such a statement on behalf of foreign customs authorities.
In practice, a lot will come down to what kind of day the officials inspecting your boat are having and how you behave towards them.

I've been boarded by customs/police in Holland, Belgium and France (I guess I have that kind of face).
Bar from a minor red diesel scare in Belgium when that thing first kicked off, they have always been kind, efficient and sometimes even helpful.
I always have all the boat/crew paperwork at the ready and I always offer them coffee.
Politeness goes a long way.

My only negative experience with customs/police officialdom was once when we were boarded at sea by jackbooted Border Force oafs between Dieppe and Newhaven.

 

[Tranona]

I did.

My background is engineering, safety engineering in particular. When a problem was presented it was researched and a statement made.

A simple statement from HMRC, e.g. no privately owned boat needs to prove its VAT status, would solve lots of boat owners wandering what in earth does the wordy regulations mean to me.

But as I have patiently explained that is not true. Ownership has little or nothing to do with whether VAT payment is due. Read post#9 very carefully. A boat is an asset, but the tax is on a transaction. "VAT paid" status is a shorthand construct indicating that the asset is not currently involved in a "chargeable event". Entering the UK from outside with a boat is potentially a chargeable event which is why HMRC ask that you have evidence that it does not apply in your situation. If you have a UK based boat (irrespective of who owns it) that has left the UK for a short period (nominally 3 years) then you can return using the Returned Goods Relief rules without paying VAT.

With regard to ownership. The same rules apply to company owned boats where the VAT has been reclaimed. Its "status" is VAT unpaid (because the company has claimed it back on a business asset). The boat can move in and out of the UK in just the same way as a private boat without paying VAT on re-entry. This applies for example to the many charter boats that regularly cruise France (and now Ireland). Just like you they just have to show that the boat originated in the UK and is returning under RGR rules.

This is not like "engineering" where you are bound by concrete laws. The "rules" are a human construct and you have to assess which apply in a particular set of circumstances. There is no definitive unambiguous answer such as you desire. This is no different from the way many activities in our society are regulated and we seem to manage quite well so don't see why you cannot live with the ambiguity, particularly as it has no direct impact on your circumstances.

 

[Tranona]

The OP wants to go to France.

So? Does not change anything I have explained about the process.